Georgia Power wants to offset Vogtle costs, interveners want to have a say
Some of the voices discussing when and how much of the expansion costs for Units 3 and 4 of Plant Vogtle can be passed on to consumers in the form of electricity bills include more than just the Georgia Public Service Commission and Georgia Power, which do a large part owns the plant. It also includes third party groups.
Because the Civil Service Commission holds hearings on the construction, third parties may be granted legal intervener status that allows them to cross-examine witnesses, provide evidence, and solicit information along with PSC staff and Georgia Power representatives. Some are in favor of the expansion, others are against it, others are still hoping that the entire project will be scrapped.
The interveners include:
- Southern Alliance for Clean Energy, which says investing in renewable energy would have been more cost effective
- Georgia Watch, a consumer protection group that deals with increased utility bills for Georgians who have already been charged
- Nuclear Watch South, an anti-nuclear group for environmental reasons
- Southern Environmental Law, which represents environmental justice groups such as Partnership for Southern Equity and Interfaith Power and Light
- Georgia Association of Manufacturers, which supports the project but wants to handle price increases
- Resource Supply Management, an energy consultancy for corporate clients
The expansion costs for the Vogtle blocks 3 and 4 are now estimated to be almost twice as high as originally. The main concern of most of these intervening groups is how the expenses from Werksvogtle Units 3 and 4 will be passed on to the tariff payers – especially those with high energy loads, as measured by the percentage of income spent on energy bills.
Continue reading:As the Vogtle plant is about to be completed, Georgia Power is trying to recoup the cost of capital
“Georgia has some of the highest energy loads in the country,” said Bryan Jacobs, Southern Alliance for Clean Energy solar director and liaison officer for Georgia. “Anything over six percent is defined as unaffordable. And we have a number of urban and rural areas in the state where the average is twice that, and there are individual locations over 20 percent.”
Cooperatives and municipal utilities are also involved in the expansion of the Vogtle plant.
“We have people paying bills all over rural Georgia who have more than one car or house note,” said Alicia Scott, Just Energy manager at Partnership for Southern Equity, represented by SELC. Monthly bills are expected to increase 13 percent “not just for Georgia Power customers, but also for our (electrical member cooperatives) and our munis who source most of their wholesale energy from Georgia Power”.
Some of these costs have been paid for by residents for years.
“We were particularly concerned that Georgia Power got lawmakers to approve the Georgia Nuclear Financing Act, which for the first time created a mechanism in Georgia that allows the utility to pre-bill its customers,” said Liz Coyle, Executive Director of Georgia Consider. “People have been paying for these units on their electricity bills every month since 2011, and we’re still nowhere near getting power out of them.”
This bill was dropped in 2018 so future projects cannot use it without new approval. In an email, Georgia Power spokesman Jeff Wilson said the NCCR plan will save customers millions in the long run by covering financing costs now.
Georgia Power’s tariffs will have to be approved by the commission, but their profits will then be driven primarily by their expenses, not their originally projected cost of $ 4.4 billion. This means that cost overruns can actually increase your bottom line, according to Kurt Ebersbach, SELC senior attorney.
“Now it’s almost all assumed they’ll get $ 7.3 billion, and I don’t see why that should be because that’s a 60 percent increase in project costs and why should customers pay for it?” he said. “I think the company should have to absorb every penny over $ 4.4 billion and the associated funding costs, but unfortunately the Commission has already made it unlikely that will happen.”
Wilson said the current cost of capital for Georgia Power is $ 9.2 billion, and they haven’t applied for approval for anything over $ 7.3 billion. He said there are safeguards in place that reduce the company’s ROI for each month of delay, which reduces customer bills.
More:Georgia Power announces that the expansion of the Vogtle plant will be delayed for a long time and will continue to move forward
The Georgia Association of Manufacturing has a particular interest in tariffs because their industrial customers can face energy costs that exceed their labor costs. Unlike many of the interveners, who are skeptical or even downright hostile to the project, they see the two new units as important capital for the state.
“We believe nuclear power has a legitimate place in the generation mix,” said Roy Bowen, President of GAM. “You only have to look as far as Texas or California to see some of the problems that result from being over-dependent on a particular generation source.”
What a fair rate looks like varies between interveners. Jacobs said some industrial customers had managed to bypass most of the nuclear tariffs, hoping the people on the lowest income levels would be somewhat isolated. Charles B. Jones III, Vice President and General Counsel of GAM, said that the service is often more expensive for residential customers than for industrial customers, but after taking those costs into account, he argues that the cost of capital should be evenly divided among different customer groups.
Participation in the process
Cost was not the only issue of concern for some interveners.
Jim Clarkson, owner of Resource Supply Management, advises industrial, commercial and institutional clients on energy use. He said he has intervened in various cases since 1984 and does so mainly to get good information for his clients.
“I’m in all Vogtle cases,” he said.
Nuclear Watch South joined the process for the first time in 2013 and has been involved since then and has spoken out against enlargement in principle.
“We are an anti-nuclear organization, an environmental group, we are not a consumer protection group, just the environment,” said Glenn Carroll, coordinator of Nuclear Watch South. “We have come to terms with the fact that nobody in this forum is really acting as an intervener to stop the project altogether, that caught our attention.”
Others, like SELC, joined in in 2017 when contractor Westinghouse went bankrupt and the Public Service Commission decided whether or not to move the project forward. Despite warnings from staff that the project may not be feasible, the PSC voted to move the project forward.
Continue reading:Regulatory authorities vote for progress at the Vogtle nuclear power plant
According to Georgia Power’s Wilson, when the units are online, Georgia Power will be 30 percent nuclear, 10 percent more than its current mix. However, some stakeholders say alternatives are also much more viable now than they were when the project began.
Jacobs said that solar power now costs about $ 1 per watt, or $ 2 billion for an output equivalent to the new Vogtle units – although he also acknowledges that solar is only on about a quarter of the time while Nuclear power is almost always online.
Almost all interveners emphasized that it was difficult as an intervener to actually influence the process.
“You enter into a David and Goliath-type scenario,” said Nathaniel Smith, founder and chief equity officer of Partnership for Southern Equity. “We are, of course, in a state in which our private benefit has a great influence, both figuratively and literally.”
Others compared the process to swimming uphill.
“The involvement of the company, PSC staff, stakeholders and customers is an important part of the process of making sure the commission hears and understands all viewpoints,” wrote Wilson. “The open and transparent process helps to inform everyone involved and enables the Commission to make the best decisions.”
The interveners also hope that the implementation of tariff increases will be influenced – for example over a longer period of time or the non-recognition of certain expenses.
For many interveners, it is also a chance to get people on record, regardless of what the PSC is doing.
“This is one of the few opportunities to interview corporate witnesses under oath about this project, to test their credibility, to see if their claims about the way things are going or to see if things get better, to see if those go through Realize time, ”said Ebersbach.