Vogtle Gets The Green Light - What’s Next?

By Ian Karra

Georgians got an early Christmas present from the Georgia Public Service Commission (PSC) in the form of guaranteed higher future electricity rates. On December 21, the commission unanimously voted to give Georgia Power the green light to continue construction on Plant Vogtle, where two new nuclear units have been under construction since 2009 and are now projected to cost $25 billion and come online 5 years behind schedule(1). 

Georgia Power rates will climb by as much as 8% when Unit 3 comes online, according to PSC chair Stan Wise, whose planned resignation will clear the way for Governor Deal to name a replacement (2). While construction continues, Georgia Power will see a cut to its profit margin, but the company still stands to profit over $5 billion from the delays. As part of the agreement, Georgia Power will build a 5-megawatt community solar project at Plant Vogtle (enough to power about 750 homes) in addition to the 3 MW project currently online. By contrast, Xcel Energy has 139 MW of community solar projects online.

Even with the commission’s blessing, the project remains on shaky ground. The vote to move forward hinges on the project’s backers receiving $800 million in tax breaks, which failed to make it into the Tax Reform bill passed at the end of last year (3). There is currently no timeline for this vote to proceed. Despite the sunny outlook from Georgia Power that construction will remain on the new schedule and budget, credit agencies have downgraded credit outlook for Georgia Power, Oglethorpe Power, and the Municipal Electric Authority of Georgia, based on Vogtle’s continued risk (4).

Throughout the hearing process, commissioners cited grid resilience, carbon regulations, and sustainability as reasons to proceed full steam ahead. We agree wholeheartedly with the sentiments, but knowing that regulators and Georgia Power will commit $25 billion to those goals, it is clear that solar, wind, energy efficiency, and smart grid investments are a better means to build resilience and move away from fossil fuels. The bomb cyclone that hit the northeast over the holidays poked a big hole in the argument for nuclear’s stability. The biggest grid failure came from a power line failure that forced Entergy Corp. to shut down the Pilgrim nuclear power plant in eastern Massachusetts (5). 

Up next in the Vogtle saga is this summer’s 18th Vogtle Construction Monitoring process, which will give clues to whether the project proceeds according to schedule and budget now under Georgia Power’s and new contractor Bechtel’s management. The race for two Public Service Commission seats currently held by Chuck Eaton and Stan Wise will take place in November 2018. The victorious commissioners will be seated at the time Georgia Power claims Units 3 and 4 will be completed; they will be tasked with the fallout if they are not. 

In January 2019, Georgia Power will file its Integrated Resource Plan (IRP), a 20-year outlook on meeting Georgia’s energy demand. The previous IRP required Georgia Power to build up to 1,600 megawatts of renewable energy, bringing the share of Georgia’s grid to about 4% renewable by 2021.

We hear a common refrain from our Georgia regulators that they do not want to pick winners and losers when it comes to our fuel sources. Big fossil fuel and nuclear bets have proven repeatedly to be losers (see: Kemper County Coal Plant and Plant Vogtle). Besides their clear environmental benefits, wind, solar, and energy efficiency are emerging as winners in the marketplace. 

Contact the Public Service Commission (gapsc@psc.state.ga.us) to support clean, renewable energy to offset the damage of nuclear rate increases.

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1) http://www.ajc.com/news/local-govt--politics/georgia-psc-votes-continue-construction-plant-vogtle/Tu0ja76KWtR3YGlhaFLTeM/

2) http://www.wrdw.com/content/news/Public-service-commissioners-vote-unanimously-to-complete-Plant-Vogtle-project-465682183.html

3) http://politics.myajc.com/blog/politics/why-vote-800m-tax-credit-for-plant-vogtle-could-come-january/eLuaIhQIOzQN9MZfYQF7nJ/

4) http://www.myajc.com/business/moody-says-credit-outlook-negative-for-georgia-power-vogtle/sSTYPODhWRXa4B8u4k2ICO/

5) https://www.reuters.com/article/usa-weather-energy-entergy/update-2-entergy-shuts-massachusetts-pilgrim-nuclear-plant-during-blizzard-idUSL1N1OZ1YI