Alexia Ridley: Welcome back to Athens News matters from WGA News. I'm Alexia Ridley. Georgians may be familiar with the name Plant Vogtle, and not for positive reasons. Since beginning construction in 2009, the nuclear production site has been plagued by construction issues, cost overruns and public opposition. A new report details the plant’s history and the impact it may have on consumers.
Patty Durand is the founder of the Energy Consulting Group Cool Planet Solutions. She's also one of the co-authors of the study, and she sat down with me to discuss its findings. Here's that conversation.
Thank you so much for joining us this afternoon.
Patty Durand: My pleasure. Thanks for having me.
Alexia Ridley: First, where can our listeners read this report for themselves?
Patty Durand: There are links on several nonprofit websites. All of the partners, so maybe the easiest link would be to go to Georgia WAND, which stands for Women's Action for New Direction. If they get to their website, they can click on “Issues” and then see the nuclear report listed right there.
Alexia Ridley: And let's now turn to Plant Vogtle, which has four nuclear reactors, including the two just completed. Plant Vogtle will cost almost $37 billion, according to your study. That's the most expensive energy plant in the world. Why did it cost so much?
Patty Durand: That's a good question. We go into those answers quite a bit, extensively, in the report. Among the reasons are that there was a lot of incompetence and inappropriate management decisions on the part of Southern Company and Southern Nuclear and Georgia Power. In fact, cost overruns were so extreme that the main contractor, Westinghouse, went bankrupt in 2017. Some of the reasons included that the contractor said that the modules for the plant would be built off site and shipped to the site, which would save money, and none of those things were true. There were no efficiencies, the construction that took place off site for the modules actually was shoddy, and when the modules made it on site they had to be redone, which cost a lot of money. And if you were to read the Public Service Commission filings made by independent construction monitors, these are nuclear engineers and nuclear experts, you would be shocked at what they documented in terms of poor executive management, poor construction, site management, and we did read those filings and excerpts of those filings are in the report, and it is hair raising and very disappointing.
Alexia Ridley: Since the pandemic and with the rise of inflation, construction costs for everything have soared. What role did that play in the plant’s cost overruns.
Patty Durand: Minor, very minor, in fact, COVID costs were documented at $200 million, which sounds like a lot unless you put it in context of a $36 billion plant. And then you see it's less than 1% of the cost. Inflation reared its head only recently. This plant has been under construction since 2009. And the bankruptcy from Vogtle, I'm sorry, from Westinghouse happened in 2017.
Alexia Ridley: Why do you think the Georgia Public Service Commission decided in 2017 to allow Plant Vogtle's construction to go forward, even though the Commission staff warned against it?
Patty Durand: Not only did the Commission staff warn against it, but the experts that the Commission brought in recommended canceling the plan, or if it continued to at least put protections in place for cost overruns so customers don't have to pay them. But the Commission declined to put the protections in place and voted to continue, as you just said, and some of the reasons are outlined in the report. There are a lot of problems with the Georgia Public Service Commission not regulating in the public interest.
Alexia Ridley: The study explores whether Plant Vogtle will contribute to energy poverty in Georgia. Can you tell us what energy poverty is and how Plant Vogtle will affect energy prices for Georgians?
Patty Durand: Absolutely. Energy poverty is a term used to mean that a person would struggle to pay their utility bill if it's higher than a certain percentage of their income. And so there are different metrics, the federal government uses 6%, if someone is paying more than 6% of their income to their utility bills, then that is going to be a struggle for them. And once it approaches 10%, then people start facing things like disconnections. And we're not talking about sitting around in the dark when someone loses their power. We're talking about very serious consequences. For instance, someone can lose their children, DFACS will not allow parents to have children in a home with no power. If they're renters, they can be evicted.
And even worse, they can die in Georgia's brutal summer heat if they don't have a fan or access to oxygen, and people have died. So those are some of the serious consequences of energy poverty. And that is basically going to be expanded because Georgia Power bills are going up 10% across the board. That is an enormous increase in someone's bill for just a little bit of energy that Vogtle provides.
Alexia Ridley: Speaking at the plant last week, US Energy Secretary Jennifer Granholm called for the US to triple its nuclear capacity. Is that a wise idea?
Patty Durand: I mean, that is just offensive. It's offensive to me on a number of ways. One is, I don't believe that Jennifer Granholm or anybody knows exactly what Plant Vogtle cost-- these two new reactors are hidden from information in terms of cost, which is why we calculated it in our report and had to cite our own information using filings from the PSC. Because the Georgia Public Service Commission is not telling people how much this plant costs that they approved and supposedly provided oversight. And that's also why when you read the Atlanta Journal or an Associated Press article or any news article they will say things like “Exceeded 32 billion, exceeded 35 billion,” because they can't list the price, because it's not provided to them. There are no citations. So Granholm is up there calling for tripling reactors with no knowledge of what they cost, and it's also offensive because these reactors are now the most expensive power plant ever built on Earth. How can she sleep at night knowing that she's calling for such an expensive source of energy that will harm ratepayers across the board when there's so many more affordable options available now?
Alexia Ridley: Thank you.
Patty Durand: Thank you for having me. And covering the report. I really appreciate it.
Alexia Ridley: Patty Durand is the founder of the Energy Consulting Group Cool Planet Solutions and is a co-author of a recent study which criticizes Plant Vogel,
Representatives for Georgia Power, responded to the study in an e-mail:
Georgia’s economy is growing - and growing quickly. The completion of the new Vogtle units will help us meet this demand and offers a new source of clean, reliable energy, available 24/7, for customers. We are proud of the thousands of American workers who were onsite day after day working to bring this project online to serve a growing Georgia. Our focus over the years has remained on safety and quality construction, and fulfilling our responsibility to our customers to provide clean, safe, reliable and affordable energy. With the completion of the units, and their exemplary performance so far, we have done just that.
Regarding Cost/Rate Impact: At Georgia Power, we understand the impact the cost to build these new units has on customers and, from the beginning, we have worked to minimize costs for customers from this critical new energy asset through proactive steps such as the fixed price contract, collecting financing costs during construction and pursuing DOE loan guarantees.
o The Georgia PSC last year issued its order on our cost recovery for the project which helps lessen the impact for customers and honors the spirit of the decision we all made to move forward in 2017. Pursuant to the PSC’s decision, Georgia Power is not recovering approximately $2.6 billion in total projected costs.
o The month following Unit 4 achieving commercial operation, average retail rates were adjusted by approximately 5%. With the Nuclear Construction Cost Recovery (NCCR) tariff removed from bills, a typical resident customer using 1,000 kWh per month saw an estimated monthly increase of $8.95 per month. This follows the previous rate impact in 2023 following Unit 3 COD of $5.42 (3.2%).
o It’s also important to note that, although nuclear has a high cost to build, it offers extremely stable and predictable fuel and operating costs over the life of the units (expected to be 60 to 80 years), helping keep rates low for our customers in the long term.
Regarding the process:
The Stipulation was negotiated and signed by a diverse group of stakeholders representing the broad-based interests of our customer base – from organizations representing manufacturing industrial customers to retail residential customers, congregations and communities of faith, and the energy-using and consuming public as a whole.
Through the robust and open VCM process (There were 29 open and transparent semi-annual VCM proceedings) all issues raised by parties to the proceeding – including intervenors – were thoroughly documented and considered by the PSC.
