Women. Power. Peace.

GA WAND in the Augusta Chronicle– ‘PSC weighs trimming Georgia Power profits if over budget on Vogtle’

By Walter C. Jones

The Augusta Chronicle

ATLANTA --- Nuclear opponents, such as Bobbie Paul and Glenn Carroll, and the companies building two reactors at Plant Vogtle both recognized that a proposal aimed at Georgia Power Co.'s purse could be fatal to the project.

Paul, the executive director of Georgia Women's Action for New Directions, and Carroll, the coordinator for Nuclear Watch South, were among a dozen residents testifying Wednesday at a hearing in which the Public Service Commission is considering its staff's proposal to trim Georgia Power's profits if the construction goes over budget. Consumer groups such as AARP and Georgia Watch support the proposal as a way to encourage the company to keep costs in line for customers.

Paul said the cost-sharing discussion is a reasonable time to try to block the reactors' construction, even though the PSC has already approved it.

"They can't let it loose on the rest of us," she said. "They are the ones who choose this type of energy. They are the ones who are responsible for the costs."

PSC member Doug Everett said during the public-comment session of the hearing, "I don't know if you know it or not that the plant is going to be built."

Two corporate executives testified separately, however, that the utility wouldn't have considered expanding its nuclear plant if the profit-trimming proposal had been adopted before the decision.

"As a member of the management team of the company, if this mechanism had been part of the original certification, we very likely would have not proceeded," said Ann Daiss, Georgia Power's chief accounting officer.

Instead, they would have chosen generating electricity with natural gas, according to Pete Ivy, the contract manager for Southern Nuclear, the Georgia Power sister company that operates nuclear plants.

Going with a gas plant over a nuclear one would have left the company thinking first of its own position rather than its customers, he said.

The 800 percent cost overruns that consumers paid during construction of Vogtle's first two reactors in the early 1980s wound up being a bargain, Ivy said.

"I will tell you that construction of Vogtle units 1 and 2 has paid for itself many times over, even with the cost increases," he said, adding that current contractual, legal and regulatory changes minimize the likelihood of similar overruns today.

Because of those safeguards, the company argues the profit-cutting plan isn't needed. Moreover, it could drive up power costs if investors react to it by demanding higher returns, warned company consultant Steve Fetter, a former Michigan utility regulator.

There is also some question about the legality of the profit-trimming proposal. Georgia law requires the PSC to pass along all legitimate electricity costs to customers, including a fair profit margin. Daiss argued that accounting rules consider profits a legitimate cost.

This article also appeared on SavannahNow.com: http://savannahnow.com/news/2011-07-07/psc-weighs-trimming-georgia-power-profits-if-over-budget-vogtle#.ThyeD1uRqSo

Contact Us

Georgia WAND Education Fund, Inc.

250 Georgia Avenue SE
Suite 202
Atlanta, GA 30312

404-524-5999 - phone

info@georgiawand.org

Georgia WAND is funded by:

AJ MUSTE graphic

AJ MUSTE graphic

newmexico

southern partners fund