What’s the first thing you do when you find yourself in a hole? Stop digging!
What’s first thing you do when you find you’ve spend $5 billion on something you don’t need? Well, for starters, you don’t spend another $15 billion to complete the project.
A week ago, a story in The Times warned readers that the construction of Georgia Power’s two additional nuclear reactors at Plant Vogtle is over cost and behind schedule. Today, the Public Service Commission must decide whether to continue funding the project or stop where they are.
I’ll be at the meeting. It’s too late to invite you to join me, but there are other ways you can have a voice in their decision.
The five men sitting on the PSC have been given responsibility and power by Georgia General Assembly to modify or revoke Vogtle’s certification if it “... finds that the certified capacity resource is no longer needed ... to assure a reliable supply of electric power and energy for the utility’s Georgia retail customers.”
The fact that Georgia Power is not fully using its present capacity was recently exposed in analysis of financial and operating data from Georgia Power’s 2002-2013 annual reports. The data show that both retail and wholesale electricity sales are flat, and Georgia Power’s utilized capacity has fallen to just over 50 percent. (83 percent capacity utilization is the industry’s norm.) The 6 percent additional capacity from Vogtle is simply not needed.
Wall Street won’t touch nuclear energy these days. It uses the phrase “utility death spiral” to describe outdated business models like Georgia Power’s — models that depend on large, centralized nuclear and coal plants.
UBS financial services recently downgraded Southern Co., owner of Georgia Power, last month. This should be a warning.
The energy picture is changing. The market is in renewables these days — wind, solar, geothermal, and other technologies that harness the power of natural forces rather than extracting energy from limited, and polluting nonrenewable resources. If this is where the smart investment is going, why does Georgia Power want to continue construction on Vogtle reactors 3 & 4?
Once again, follow the money. Look at how the project is funded. Georgia Power is using a financial instrument called Construction Work In Progress. CWIP allows Georgia Power to bill its customers for the electricity they are using now, and in addition, to bill in advance for electricity supply Georgia Power hopes to generate in the future, if and when and Vogtle reactors Nos. 3 & 4 come on line.
CWIP funding gave Georgia Power an edge in borrowing $6.5 billion tax dollars from the U.S. treasury, with no down payment and 0 percent interest. The PSC allows Georgia Power to automatically make an 11 percent profit, so the federal government is figuring the massive loan will be repaid because Georgia ratepayers are on the hook for the money.
But here’s the clincher! Even if the new reactors are never completed, the extra money Geogia Power has and will collect stays with Georgia Power.
Remember, this is $20 billion in public money that’s being squandered on unneeded Vogtle reactors. It’s customers’ money, U.S. taxpayers’ money, not Georgia Power stockholder money.
If you don’t want to finance unnecessary nuclear reactors and all that entails — more radioactive waste and more security risks — start by calling for the repeal of CWIP. For more information, look up Nuclear Watch South on the web and scroll down to “What Is CWIP.”
Georgia Power has lined up almost all necessary financing and licenses to build the unneeded nuclear reactors. This is a perfect stopping place for Georgia Power and the PSC to decide to mothball the construction site and see if the marketplace ever becomes more favorable to nuclear.
We just might save Georgia Power from itself. In New Hampshire their public service company went bankrupt after a similar CWIP nuclear power debacle.
Joan King lives in Sautee. Her column appears biweekly on Tuesdays and at gainesvilletimes.com/viewpoint.