The future of the Plant Vogtle reactor project: keep building despite cost overruns, including a recent report of another $2.3 billion. That is the decision from one of the project partners today, MEAG (Municipal Electric Authority of Georgia) whose board of directors voted unanimously to continue construction. The vote was taken despite pressure from a Jacksonville utility company that is now embroiled in a legal dispute (with MEAG) over the cost of construction and the ultimate cost of electricity which will be generated by the new reactors.

The project to build two new nuclear reactors at the site in Burke County near Waynesboro has soared in costs and is five years behind schedule.

In August, Georgia Power which has taken over construction announced that the projected costs had risen another $2.3 billion. That announcement triggered a stipulation in a revised partner agreement that all parties would have to vote to approve the higher costs and therefore to keep building.

The four partners are Georgia Power (with a 45.7% project share), Oglethorpe Power Company (with a 30% share), MEAG (Municipal Electric Authority of Georgia with a 22.7% share) and the city of Dalton (with a 1.6% share.)

UPDATE: As of 8:30 p.m. on Sept. 24, Oglethorpe Power Corporation announced that its partners in the Plant Vogtle 3 and 4 project – Southern Company/Georgia Power, the Municipal Electric Authority of Georgia and Dalton Utilities – have accepted its proposal to extend the deadline for a decision with regard to its continued participation in the Plant Vogtle 3 and 4 project until 5 p.m. on Tuesday, Sept. 25.

The agreement indicates that 90% of the project share partners must agree to continue construction. Georgia Power had announced earlier it had voted to move forward, telling WSAV this morning “A year ago, Georgia Power and all of the Vogtle co-owners entered a new contract to move forward with the project and everyone acknowledged and accepted all possible risks. Georgia Power has voted to move forward, and we hope the co-owners will also vote in favor to fulfill their obligation.”

The MEAG board of directors had been asked to abandon the project by a Florida utility (Jacksonville Electric Authority of JEA) that had promised to buy Vogtle generated electricity from MEAG.

JEA said last week that it could buy electricity (over the 20 year purchase agreement) for about $2.5 billion “less” than what the electricity would cost from Vogtle, i.e. because of the escalating construction costs. JEA said it was working on behalf of its own customers for the best deal and Vogtle was a “bad deal.” JEA appealed to the board of directors of MEAG to abandon the Vogtle project and said even MEAG customers stood to benefit from stopping construction. JEA also said its own estimates put the cost of completion of the Vogtle reactors at upwards of $30 billion.

At the same time last week there were two other developments:

1) A group of Georgia lawmakers sent a letter to the project partners indicating concerns about the rising costs of the Vogtle project and saying that a cap should be placed on the cost to protect customers.

2) And Governor Nathan Deal sent a letter to the project partners urging them to stay the course. Deal’s letter said, “Given the project’s critical economic impact to the state of Georgia, I strongly encourage project co-owners to continue to work to complete Vogtle 3 and 4.”

3) The DEO (Department of Energy) contacted project partners and said that if the project was canceled that it would quickly seek to collect up to $6 billion already borrowed.

Sara Barczak with the Southern Alliance for Clean Energy commented today about the lawmakers’ letter. “I think this is the legislators saying no more unless there is some miracle cur put on this project and I think that’s extremely important and it’s something that Oglethorpe and MEAG need to very carefully weigh,” she said.

Barczak also commented about the governor’s letter saying “Plant Vogtle is not a construction project. Georgia Power customers, Oglethorpe customers and MEAG customers are not supposed to be paying for years and years and years of thousands of workers on site at Plant Vogtle and remember the construction was supposed to be done by now.”

Southern Alliance for Clean Energy (SACE) says Georgia Power customers have already paid about $2 Billion for upfront financing costs, although customers this year have received a total of $188 million in refunds as part of the plan to keep building.

Monday afternoon, MEAG board members voted unanimously to continue construction despite the latest projection of another $2.3 billion in construction costs. The board saying it took its responsibility seriously and had to weigh carefully what the impacts would be to keep construction going versus a cancellation of the project.



Barczak told us after the vote that “it appears MEAG had succumbed to political pressure from Georgia Power, the state and the federal government.”