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Georgia Public Service Commission continues Vogtle reactor boondoggle ‒ but the project is probably still doomed

Nuclear Monitor Issue: 
Tim Judson ‒ Executive Director, Nuclear Information & Resource Service

In December 2017, the Georgia Public Service Commission (PSC), which regulates electric and gas utilities in the south-eastern US state, voted to approve continued construction of two AP1000 reactors at Georgia Power's Plant Vogtle.1 This decision was unsurprising because of the Commission's utter failure to question the project throughout its ten-year history, but the decision is all the more ridiculous and unfortunate for it.

The vote flies in the face of the evidence about the project's likelihood for continued failure, the state's energy needs, and the PSC staff's own recommendation to cancel the Vogtle reactors if Georgia Power did not agree to swallow US$4 billion of the cost.2

The PSC's decision is far from the end of the story ‒ more of a momentary reprieve that helps the industry save face, but not for long. The nuclear industry and its political backers simply could not afford to lose this round over Vogtle – and it is likely that significant outside pressure came to bear on the PSC, not only from Southern Co. and its army of lobbyists, lawyers, and government cronies. In fact, the Commission truncated its review of Vogtle, originally scheduled for a PSC vote in early 2018.

Time is only working against this project, with more information coming out each week regarding engineering and project planning failures, and subsequent coverups and collusion between utilities, Westinghouse, and regulators. Vogtle's twin project in South Carolina – the V.C. Summer 2 and 3 reactors – was cancelled in July 2017, leading to investigations of the project that have revealed years-long coverups3 leading to the project's failure and cancellation, resignations of utility executives4, utility reform legislation5, and a vote to deny the South Carolina utility's recovery of costs and reducing customers' bill by 18%.6

The PSC's vote to 'damn the torpedoes, full speed ahead' exempts the Commission from having to consider even more damning evidence that may well emerge in the coming weeks.

That said, the fight is not over, by any means. There are more days of reckoning to come in the years ahead. In 2014, the US Department of Energy issued US$6.5 billion taxpayer-guaranteed loans to Vogtle partners Georgia Power and Oglethorpe Power with $0 credit subsidy fee (similar to a down payment, to reduce the government's financial risk).7 Additional loan guarantees of US$1.8 billion were granted in 2015 (to project partner Municipal Electric Authority of Georgia ‒ MEAG Power), as well as an offer by the US Department of Energy to provide another US$3.7 billion in loan guarantees in September 2017 (to Georgia Power, Oglethorpe and MEAG).8

In 2014, it seemed to many like that would be the last straw – zero risk to Georgia Power for repaying a massive loan that covered all of Georgia Power's share of the project. But then the utility continued asking for rate hike after rate hike as the costs of Vogtle continued to go up9 … and then Westinghouse had to buy out the project's main contractor10, CB&I, to settle a mountain of legal disputes11 … then Westinghouse went bankrupt12 after taking over CB&I and inheriting all of the project's problems … then the V.C. Summer reactors were canceled13 … then the scandals and coverups14 of engineering problems started to emerge … and here we are today.

The PSC should have concluded the sorry saga and canceled Vogtle. Just don't be too quick to judge the vote a failure for those calling for Georgia to ditch the reactors. Environmental and consumer activists have mounted a heroic fight to stop Vogtle, in the face of monstrous political odds. And the foundation is starting to crack: Georgia PSC staff for the first time admitted not only that the Vogtle project has problems but recommended it be canceled if the utility didn't agree to swallow US$4 billion of the cost.15 Now, there is a division in the ranks of the utility establishment – making it as likely as not that the PSC's vote is really the beginning of the end for Vogtle.

Recently, I was looking over old status reports on reactor construction from the 1980s, and was reminded that Vogtle 1 and 2 were the single most expensive nuclear project in the first generation of nukes in the US – costing US$8.8 billion by the time the reactors were both completed in 1989 (that would be about US$18 billion today).16 Now, 30 years later, Southern Co. / Georgia Power is doubling down for a two-fer, with Vogtle 3 and 4 projected to cost US$25 billion. There is no doubt that Southern Co. has recouped massive profits on Vogtle 1 and 2, through the utility's guaranteed return on investment, and is desperate for even greater profits if Vogtle 3 and 4 ever come online.

The truth is, Southern Co. is not qualified to manage a reactor construction project (it operates six reactors, but doesn't design or build them)17; its new contractor, Bechtel, isn't going to assume any of the cost or risk to finish the reactors18; and the rotten underbelly of technical and financial problems19 plaguing the Vogtle reactors' construction means, at the very least, years more in delays and billions more in costs should be expected. And probably more train wrecks along the way.

Had the PSC cancelled the project in December – or forced Southern Co. to do so by holding the company accountable for the massive cost overruns – they could have saved a lot of face and pinned the blame on Westinghouse and their own 'bad apples'. Going forward, it will be a different story: Southern Co. and the Georgia PSC now have no one else to blame. And they could find themselves facing the same cleaning of the house now taking place across the border in South Carolina.

The US 'nuclear renaissance' is dead

It's hard to overestimate how desperate the US nuclear industry is to keep Vogtle construction going. Rightly or wrongly (more likely the latter), the industry views the completion of Vogtle as vital to its future.

Vogtle 3 and 4 are now the only new reactors being built in the US, more than a decade after the proclamation of a 'Nuclear Renaissance' which led to license applications for 30 new reactors between 2007 and 2010. While many of the licenses were approved, only V.C. Summer and Vogtle started construction – twin projects, both using Westinghouse's AP1000 reactor design. By early 2017, they had bankrupted Westinghouse – the largest nuclear designer/builder in the world, responsible for about 50% of reactors around the globe. Westinghouse now says it will not undertake any new reactor projects, nor will it complete Vogtle and V.C. Summer. And with V.C. Summer 2 and 3 cancelled, it means 28 of the 30 'Nuclear Renaissance' reactors have now been formally abandoned or indefinitely shelved.

The story of V.C. Summer is one of stark opportunity costs, one that looms over Georgia PSC's decision to charge ahead with Vogtle: South Carolina utilities wasted ten years and US$9 billion on the project. Ratepayers are paying 18% of their monthly bills for two reactors that will never generate a single watt of electricity. They were still 5‒10 years and US$16 billion from completion – a completely rational basis for cancelling the project.

But had the utilities eschewed the nuclear option in 2007 and invested in energy efficiency and renewables, not only would they have reduced carbon emissions and electricity usage significantly by now, South Carolina families and businesses would have lower electric bills today and the state could have built a strong, sustainable clean energy economy and created thousands of jobs.

If Georgia had cancelled Vogtle in December, the nuclear industry's case that it has a meaningful role to play in the country's energy future, addressing climate change, or anything else would be self-evidently false. With at least two reactors being built that could operate into the 2060s, there's at least a chance that the US will still have some nuclear-generated electricity in the late 21st Century.

But the industry can't keep itself going on the backs of just two over-budget, hopelessly delayed, unnecessary reactors. Georgia doesn't need Vogtle 3 and 4, and it never did. But by the time the reactors are completed ‒ if ever ‒ that will be the world's most expensive novelty item. Of course, the farce will quickly turn to tragedy if those nuclear mementos were ever to start splitting atoms ‒ generating nuclear waste that will be hazardous for hundreds of thousands of years, and a multi-billion dollar bill for decommissioning the reactors and cleaning up their radioactive mess.

With or without Vogtle 3 and 4, the only future nuclear has left in the US is keeping increasingly old, dangerous, uneconomical, and uncompetitive reactors going for as long as it can – while solar, wind, energy efficiency, storage, electric vehicles, smart appliances, microgrids, and other modern, more environmentally sustainable, consumer-friendly, and increasingly affordable energy options take off.





















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Vogtle construction faces "additional delay"

Nuclear Monitor Issue: 

Late March, less than two months after receiving a nuclear construction license for its new Vogtle reactors, Southern Company is already pressing Nuclear Regulatory Commission for an expedited license amendment to avoid further slippage. Delays are already considerable, since pouring of the concrete, planned to start immediately after receiving permission in February, will not start before June. Furthermore, Southern Company has already identified 32 License Amendment Requests it will seek by 2014. This could add millions to cost overruns already documented at Vogtle and lead to other construction delays.

Less than two months after receiving the nuclear construction license for Vogtle in eastern Georgia, Southern Company is already requesting a license amendment to allow changes to the foundation on which the reactor building would be built. A request which the company aimed to file by last Friday seeks to relax standards for the concrete foundation due to Southern’s miscalculation of soil compaction, and the company is pressing regulators for swift approval to avoid what it calls “an additional delay in the construction of the nuclear island basemat structure and subsequent construction activities …”.

In a letter to the NRC dated March 30, 2012, Southern Company admits that construction of the reactor base has not yet begun and that construction will begin in mid-June – if NRC quickly approves the licensing change. It had been thought that pouring of so-called “nuclear concrete” would begin immediately on issuance of the construction license in February, but the letter confirms the long delay.

In the filing made public early April, Southern has asked the NRC to allow it to pour the foundation at its own risk in June even though the foundation may not meet current license specifications. Southern asked that NRC approve the preliminary amendment request (PAR)  by June 1. If NRC does not object to a PAR, the licensee may proceed with the action described at its own risk while the agency reviews the related license amendment. If NRC were to subsequently reject the license amendment request, the licensee would have to restore the site to an acceptable condition, the agency has said. Industry pressed for the PAR process to prevent project delays while NRC conducts year-long reviews of license amendments.

Southern Company’s amendment request describes how recent surveys determined that a level foundation for three “nuclear island” buildings cannot be obtained unless the previously allowed one-inch variation in the “mudmat” substrate is increased to four inches. The nuclear island foundation supports the weight of the buildings and equipment and is vital in protecting the plant against earthquakes and other loads.

Southern told NRC that the increased tolerance should not impact earlier analyses or require additional testing, and it warned that the unforeseen need for the foundation change could cause serious delays to numerous parts of the project. But public interest groups pointed out today that foundational concrete is central to the entire project, and that any relaxing of requirements could have serious safety and cost implications.

“Southern Company clearly miscalculated soil compaction in the holes excavated for both reactors at the Vogtle site, which could be an omen about the path forward,” said Jim Warren of NC WARN today. “The NRC simply cannot skip any steps in reviewing this fundamental safety issue just to accommodate the construction schedule, and a public hearing on the design change is warranted.” 

32 Amendment requests
Additionally, Southern Company has already identified 32 License Amendment Requests it will seek by 2014. The list of LARs contains little mention of impacts on construction schedule or cost. Nor is it clear how the list of proposed changes might impact a federal lawsuit that is seeking to stop construction at Vogtle.

NC WARN and the Alliance for Nuclear Accountability believe that the changes being sought via the LARs could add millions to cost overruns already documented at Vogtle and lead to other construction delays.

The public interest groups noted today that each LAR proceeding normally takes up to one year or longer, and that one or more of the nine nonprofits contesting the Vogtle project might choose to intervene in any of the 32 license amendments being sought. Regardless of interventions, the NRC’s ability to handle so many license amendment reviews is in question.

Also, it is not clear whether Georgia utility law allows Southern to continue construction without the NRC’s full approval of LARs – while pre-charging ratepayers for the plant. And the problems could further complicate a pending and highly controversial US$8.3 federal taxpayer loan guarantee.

Tom Clements of the Alliance for Nuclear Accountability said: “The foundation problem raises questions about quality control and highlight concern about slippages in the construction schedule. The foundation problem and the long list of scheduled license amendments show that other changes and unexpected ahurdles are ahead for the Vogtle project.”

Source: News release from NC WARN and Alliance for Nuclear Accountability, 9 April 2012 / International Energy (, 10 April 2012
Contact: NC WARN (North Carolina Waste Awareness and Reduction Network), P.0. Box 61051, Durham NC 27715-1051, USA.
Tel: +1-919 416-5077

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