Plant Vogtle is almost complete — time to celebrate? – Saporta Report
By Guest Columnist PATTY DURANDpresident and founder of Cool Planet Solutions and a candidate for the Georgia Public Service Commission District 2.
As spring approaches, so does the in-service date for Plant Vogtle’s Unit 3, the first of two nuclear reactors under construction in Georgia, and the only nuclear plant under construction in the country. If Unit 3 enters service in April as projected, should we congratulate Georgia Power? And is it time to thank the Georgia Public Service Commission for its approval and oversight?
If Plant Vogtle comes online, it will be anything but a success story. At $34 billion, Plant Vogtle is the most expensive power plant ever built on earth. That is federal levels of spending by one state on one power plant. And the impact on electric bills will be severe: originally forecast at $5 per month, bills are now estimated to increase by $16.80 per month for just one plant. Those costs could go higher since the plant is not done. As an energy colleague of mine said recently, “Georgians are taking it on the chin for nuclear energy.”
And that is not all. Georgians began paying for Plant Vogtle in 2011 because the Georgia legislature authorized Georgia Power to collect a nuclear tax on every Georgia Power bill, called Nuclear Construction Cost Recovery (NCCR). Combined with cost overruns, the NCCR tax means Georgia Power has racked up an incredible $9.4 billion in profits to date, rewarding them for being years behind schedule.
Every month on every bill for thirteen years customers have paid this nuclear tax, totaling over $1000 for each Georgia household. Isn’t it past time this tax gets repeated?
Since electricity produced with nuclear energy is carbon-free, doesn’t that make Plant Vogtle a good thing? It would, except Plant Vogtle’s energy is five times as expensive as electricity produced from solar plus battery storage.
Let’s be clear: Carbon-free energy was never the reason for Plant Vogtle. Georgia is one of only nine states with no carbon emissions or renewable energy goals. Not only are there no goals, but in July of 2022 elected commissioners at the Georgia Public Service Commission (Ga. PSC) voted to approve the addition of 2,300 megawatts of carbon-emitting gas to Georgia Power’s portfolio.
Simply put, Plant Vogtle happened because Georgia Power’s business model rewards capital investment. The more costly the investment, the greater the profit.
The practice of utilities earning profits from building big things worked well in the 20th century when the country needed a massive grid buildout but in the 21st-century public interest needs are drastically different: We want to accelerate clean energy, increase grid resilience, and build a distributed, digital grid that is flexible, engages customers and saves money. Many states have begun to transition towards these goals.
Instead of celebrating Plant Vogtle, the people of Georgia should know that they have not yet paid the true costs of Plant Vogtle because those costs don’t begin until each reactor is put into service. Some construction costs are already approved but there is still the issue of cost overruns. Public hearings will be held later this year to determine if customers are going to pay billions of dollars for Vogtle’s cost overruns.
And the PSC should not approve those costs. There is no scenario in which a for-profit corporation like Georgia Power operating in a market economy could earn profits for the management failures that are the hallmark of Plant Vogtle, now seven years overdue and $20 billion over budget. These failures are well documented.
Regulatory reform is urgently needed so this will never happen again. Georgia Power and the Ga PSC celebrate what they call a “constructive regulatory relationship.” They believe their close relationship benefits all parties, but this is a false narrative of mutual benefit that does not exist.
Georgia Power is a for-profit corporation with a mission to deliver maximum profits to its parent Southern Company, which must make quarterly earnings reports to Wall Street and issue dividends to stockholders. The Ga PSC is a taxpayer-funded state agency with a mandate to protect the public interest and set just and reasonable rates. These goals are not in alignment.
The record tells the story: Georgians pay the 7th highest electric bills in the country and are in the bottom 10 for cost-saving programs like energy efficiency and demand response. Energy poverty is among the highest in the nation and over 20,000 Georgia Power customers are disconnected monthly for failure to pay.
We should not celebrate the harmful financial impact of Plant Vogtle. Instead, we need reform:
- The Georgia legislature should bring back the defunded state’s Consumer Utility Counsel (CUC). Since 2008 Georgia has been one of only three states with no consumer utility advocate. It is unlikely that Plant Vogtle would have been approved with no cost cap or consumer protections with a CUC.
- In a competitive market, a for-profit company could never profit from failing to deliver its product on time and on budget for thirteen years. Neither should a regulated monopoly. Let’s have legislation to that effect.
- The Georgia legislature should immediately repeal the Nuclear Construction Work in Progress legislation that authorized the NCCR tax.
- Let’s end Georgia Power’s incentive to build big expensive projects. There are numerous ways to adopt utility business model reform. Let’s have an independent commission to study what other states have done.
- Finally, the Georgia legislature should rename the Public Service Commission to Public Utility Commission. Voters and consumers do not know what “service” means. Give them some help so they can engage in the energy future they are paying for and must live with.
Without reforms, Georgia Power will continue building big, over-priced projects in pursuit of growing profits.
And Georgians will keep taking it on the chin.
Would you like to write a guest column for SaportaReport? The SR team strives to uplift and amplify the diverse perspectives in our community, and we want to hear from you! Email Editor Derek Prall to discuss the specifics.