Vogtle: at $65 billion and counting, it’s a case study of nuclear power’s staggeringly awful economics
August 3, 2015 | C.A.N.
By Michael Mariotte
Vogtle Units 3 (left) and 4, July 30, 2015. After 41 months of construction, the project is 39 months behind schedule. Photo by High Flyer, special to Savannah River Site Watch.
Georgia is one state that you would think would be wary of nuclear power economics. The first two reactors at Georgia Power’s Vogtle site, which came online in the late 1980s, were a record 800% over budget.
That is a number that is almost impossible to grasp. Nothing goes 800% over budget–in the real world, projects get cancelled well before reaching that point.
I’m thinking of making about $100,000 worth of improvements to my aging house desperately in need of them. 800% over budget would take that to $800,000. But I could buy a very nice house for that instead, even in the Washington DC area. Of course, I can’t afford an $800,000 house and can’t afford a project that is 800% over budget, either. Most people can’t. Neither can businesses. So if those improvements start to creep up from the budget–in my case if they go more than about 10% over budget–the whole project gets the kibosh.
Sane people do not let projects get 800% over budget. Unless, perhaps, if someone else is putting up the money. And that’s exactly what happened with the first two Vogtle reactors–the overruns were pushed on to ratepayers; Georgia Power had to eat some small portion of them, but basically ratepayers were forced to pick up the tab.
And in a case of history repeating itself as predicted–as farce–that’s exactly what is happening with the two Vogtle reactors under construction now.
When the project was announced, and when the utilities building the project first applied for taxpayer loans to help finance the project, Southern Company (Georgia Power’s parent) said the two reactors would cost about $14 billion and would be online in 2016 and 2017.
That was back around 2008. Vogtle got its taxpayer loan promise in February 2010 and its construction permit in February 2012. Three and a half years later, Vogtle is more than three years behind schedule–39 months behind, in fact.
And the cost of building Vogtle has, not surprisingly, gone up. Way up. Right now, it’s somewhere around $16 billion and rising fast–the over-budget portion caused by the delays alone is $2 million per day. And as you can see from the photo at the top of the page, taken last Thursday, construction still has quite a long way to go.
Georgia Power already has run through half of its federal loan money, paid for by all U.S. taxpayers, not just Georgia ratepayers. Some of the rest of the taxpayer loan (the loans totaled more than $8 billion) was received later by the other partners, so perhaps they haven’t run through their share yet.
In any case, the supposed point of getting the loan, and of charging ratepayers for construction costs as they are incurred (a concept called Construction Work in Progress, barred in most states), and of building the reactors in the first place, …read more
Read more here:: http://safeenergy.org/2015/08/03/vogtle-at-65-billion-and-counting/
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