Georgia Power told regulators if they had known they would be responsible for $6 billion of the cost of nuclear reactors at Plant Vogtle, they would be building a natural gas-fired plant instead, according to the Atlanta Journal-Constitution.
The project is estimated to cost $14 billion and the utility would be responsible for $6.1 billion of the costs, the article said. The Georgia Public Service Commission reportedly wants to cut into the utility’s profits if the project runs more than $300 million over budget. The provision would reportedly allow for some cost increases but keep customers from having to pay for those.
Company executives, however, said that the requirement could drive up financing costs and potentially damage the ability to raise capital. The plans would also reportedly force Georgia Power to look at short-term financial decisions instead of long-term ones, such as maintenance decisions.
“As a member of the management team of the company, if this mechanism had been part of the original certification, we very likely would have not proceeded [with the project]," Ann Daiss, Georgia Power’s comptroller, was quoted as saying in the article.
Georgia Power would not have to pay overruns if there are any safety, efficiency or regulatory changes, the article said. Also, if the project runs under budget by $300 million, profits would get a boost.
Should their share increase to $7 billion, Georgia Power reportedly wouldn’t earn below a 10.25 percent return on its investment from this project. The current rate of return on investment is set at 11.15 percent.
The PSC will vote on the issue in August.
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