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PSC is watching nuclear plant projects closely

POSTED: August 25, 2011 1:00 a.m.

I wanted to respond to Joan King's Tuesday column, "Utility's risk-sharing plan akin to a tax hike on customers." She has omitted several important facts concerning the construction of Georgia Power's new nuclear reactors at Plant Vogtle in Waynesboro.

First, the loan guarantee is not a loan. Georgia Power could decide it will not accept the loan guarantee and turn it down.

Also, Ms King stated that the shareholders should pay for the construction of the plants. Doesn't she realize that all companies include capital costs in the products they sell, whether it be the local grocery store to the cost of a large car manufacturing plant or from a monopoly to a nonmonopoly company?

Ms. King worries about the cost of the nuclear construction project. She notes that the original reactors, completed in 1989, had an estimated initial construction cost of around $700 million but at the completion of the project the cost rose to $9 billion.

What she omits is the fact that this time the Public Service Commission is closely monitoring this project from the beginning. We have appointed an independent monitor who meets with Georgia Power and its contractors on a weekly basis. The company files construction reports every six months. This commission reviews these reports and then determines if those costs are prudent and should be passed onto to ratepayers.

This is a much different scenario from the construction of the Plant Vogtle units in the 1980s. When Units 1 and 2 were constructed, the plants were not accepted by the government until after they were built. And because of the Three-Mile Island incident that happened while those units were under construction, there were many changes mandated by the federal government. Now the plants are accepted before they are constructed; thus, that scenario cannot happen again.

In the latest proceeding, the company changed its position and agreed with the commission that costs could be reviewed later during the construction period if evidence surfaced of fraud, misrepresentation or criminal misconduct in the construction project. This commission retains full authority to disallow any expenses it determines are imprudent and excessive.

Also, paying the financing costs of the construction project will save ratepayers $300 million instead of waiting until the reactors are completed and then passing all of those costs along to ratepayers.

Lastly, I listen to everyone who comes before the commission. I am available to any citizen of Georgia who wishes to discuss the issues with me.

Doug Everett
Georgia Public Service Commissioner


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