A Free-Market Energy Blog

Nuclear Fiasco: Plant Vogtle 3 & 4 ‘Adjustment’ (what’s new?)

By Robert Bradley Jr. -- November 10, 2021

“As we’ve said from the beginning of this project, we are going to build these units the right way…. We have endured and overcome some extraordinary circumstances building the first new nuclear units in the U.S. in more than 30 years. Despite these challenges, progress at the site has been steady and evident.”

– Chris Womack, chairman, president and CEO of Georgia Power, October 21, 2021

Forget the U.S. Synthetic Fuel Administration of the 1970s. Forget the Obama Administration’s Solyndra project. The biggest debacle in modern U.S. energy history appears to be in Georgia, and the saga continues.

And far from unique, the latest-and-greatest in nuclear (this was supposed to be the breakthrough) is a warning sign about nuclear power in general. It has always needed government subsidies and protection. And it was a setup train wreck under lenient public utility regulation that allowed the franchised monopoly utility to recover all costs and a “reasonable” rate of return on invested capital.

So here we are. A project approved in 2006 and started in 2013 was expected to cost $14 billion with start-up in 2016 (Unit 3) and 2017 (Unit 4). Now, the expense is $27 billion and counting with an estimated start date of 2022 and 2023. The original contractor Westinghouse went bankrupt and Flour & Bechtel are now trying to get the two units built and operating.

Yet the federal government seems to be all smiles about the “next-generation nuclear reactor” technology at issue:

The Department of Energy (DOE) has issued a total of up to $12 billion in loan guarantees to Georgia Power Company (GPC),  Oglethorpe Power Corporation (OPC), and three subsidiaries of Municipal Electric Authority of Georgia (MEAG Power) to support the construction of Vogtle Units 3 and 4 – the nation’s next generation of advanced nuclear reactors – at the Alvin W. Vogtle Electric Generating site in Waynesboro, Georgia. Two AP1000 Generation III+ reactors will be constructed at Vogtle, which currently has two previous generation pressurized water reactors in operation.

Eight hundred jobs! Clean energy! And DOE Secretary Rick Perry of the Trump Administration kept the project going when it should have been scrapped back in 1st Qr:2019.

Georgia Power Press Release

The full press release from Georgia Power follows:

ATLANTA, Oct. 21, 2021 /PRNewswire/ — Georgia Power today announced a revised schedule for the Vogtle 3 & 4 nuclear expansion project. The company currently projects a Unit 3 in-service date in the third quarter of 2022 and a Unit 4 in-service date in the second quarter of 2023, representing a three-month shift for each unit.

The change to the schedule is primarily due to the need for additional time to address continued construction challenges and to allow for the comprehensive testing necessary to ensure quality and safety standards are fully met.

Unit 3 fuel load could occur as early as the first quarter 2022, but a fuel load date as late as May 2022 should support a third quarter 2022 in-service date.

“As we’ve said from the beginning of this project, we are going to build these units the right way, without compromising safety and quality to achieve a schedule deadline,” said Chris Womack, chairman, president and CEO of Georgia Power. “We have endured and overcome some extraordinary circumstances building the first new nuclear units in the U.S. in more than 30 years. Despite these challenges, progress at the site has been steady and evident.”

The new Vogtle units are an essential part of Georgia Power’s commitment to deliver safe, clean, reliable and affordable energy, and are expected to provide customers with a reliable, carbon-free energy source for the next 60 to 80 years.

Progress continues to be made towards Unit 3 fuel load following the successful completion of hot functional testing this summer. Unit 3 direct construction is 99% complete, with the total Vogtle 3 & 4 expansion project approximately 95% complete.

The overall projected peak rate impact to Georgia Power’s retail customers is approximately 10%, with nearly 3% in rates today. The rate impacts include customer benefits that the company proactively pursued – including federal production tax credits and interest savings from the Department of Energy loan guarantees – as well as fuel savings associated with adding additional nuclear units to the generation mix. Protections put in place by the Georgia Public Service Commission (PSC) to reduce the Company’s return on equity during construction are projected to save customers approximately $1.3 billion.

Once operating, the two new units at Plant Vogtle will be able to power more than 500,000 homes and businesses. A diverse fuel mix, including nuclear, is essential to maintaining a reliable and affordable energy infrastructure that attracts new investment, supports economic growth and creates jobs.

With more than 7,000 workers on site, and more than 800 permanent jobs available once the units begin operating, Vogtle 3 & 4 is currently the largest jobs-producing construction project in the state of Georgia. The project has also been an economic development driver for the region during construction.

Nuclear Energy Consultants meekly commented: “Moving forward but with another schedule delay.”

Final Comment

The continuing delays are not new or unexpected. More could yet come. After all, nuclear is the most complicated, expensive, perilous way to boil water. Natural gas combined cycle and state-of-the-art coal plants can be built at a fraction of the cost and much more quickly.

Nuclear power, in fact, has always been problematic and government-dependent. A classical liberal, free-market view is consumers decide what gets built, at what scale, and when. Not government subsidies.

Existing nuclear capacity with high sunk costs and low operating costs? That’s another story. But new nuclear capacity as the silver bullet for climate-change policy does not appear to be an affordable exit from the energy road to serfdom.

6 Comments


  1. Ed Reid  

    There might not be “an affordable exit from the energy road to serfdom”, especially in a “Net Zero” world.

    Nuclear is still likely cheaper and more reliable than battery storage as support for intermittent generators, especially through multi-day periods of low/no sun and wind and to offset seasonal variations in solar and wind availability.

    Reply

  2. John W. Garrett  

    PORTLAND, Maine (AP) — Maine’s public utility regulator believes most Maine people are going to see the rate they pay for home electricity increase this year, in some cases by a considerable amount.

    The Maine Public Utilities Commission has informed the Maine Legislature of the coming bump in prices. A majority of Maine residents could see their rate go up between 60% and 80%, the Portland Press Herald reported.

    Maine people buy power from utilities Central Maine Power, the largest in the state, and Versant Power, which provides energy in northern Maine. Under expected increases, the cost of power would climb about $20 to nearly $53 per month for a typical household, the Press Herald reported.

    Rich Silkman, chief executive of Competitive Energy Services in Portland, said the price bump is “not only possible, it’s almost certain.”

    The price of energy has risen around the world during the coronavirus pandemic. Natural gas prices have been especially high.

    Reply

  3. Bob Cherba  

    I was involved in the nuclear industry from 1966-1996, from an early BWR (Big Rock Pt) to the last, or some of the last PWRs at Palo Verde Nuclear Generating Station. I was a startup engineer at the Palisades plant in the late 1960s. I believe it was the first large (750mwe) Combustion Engineering plant, with Bechtel as the architect-engineer-constructor. Consumers Power, CE and Bechtel were all working hard to bring the plant on line for 100 million dollars, which was almost competitive with coal plants at the time (I believe.) I think the plant took five or six years from announcement to on line, despite the typical problems associated with first-time designs and construction. Thirty years later, the three Palo Verde 1,300 mwe units cost about six billion dollars.
    Since we didn’t design and built any nuclear plants for over 20 years, the Vogtle plant suffers from a lack of experience in engineering and construction, new primary system design, and the burden of 40 years of regulatory requirements. However, in the long run the electric consumers will benefit from these nuclear plants, since the pie-in-the-sky renewable energy schemes won’t be able to do the job.

    Reply

    • rbradley  

      Thank you Bob.

      With nuclear plants being built in other parts of the world, I guess importing the expertise was not feasible. Westinghouse went under with the original design, which was something.

      A whole book should be written to understand the complexities and what was avoidable and what not.

      Reply

  4. Kevin  

    I worked on the sister units to Vogtle at VC Summer in South Carolina which was cancelled in 2017. One of our major problems was getting qualified people. Many of the people that still had the skills for nuclear work were in their 50s and 60s. The other problem was that Westinghouse did a terrible job selecting subcontractors. Westinghouse was not a very honest company as was discovered when their schedule was audited and found to be bogus. I’m kind of surprised tgat Vogtle didn’t get cancelled as well. Vogtle took the Obama bucks whereas SCANA did not. Glad I am retired and will never work with Westinghouse again.

    The Small Modular Reactor designed and built by NuScale is designed to be built in a factory like an aircraft and delivered to the site. We’ll see how that works.

    Reply

  5. Kevin  

    The nuclear plants operating in the US today were built under a two-step licensing process. A design and a site was approved and a construction license was issued. When construction was complete an operating license was submitted and hearing held to evaluate that the construction was implemented as designed. There were inevitable differences and these differences were reconciled aspart of the process and an operating license was issued.

    The AP1000s were built under a one step process. A site and design was approved and at each step, construction was verified to meet the design. Once construction was completed, you were clear to operate. The problem was, some of the plant was still being designed as the plant was being built. Many tasks had to wait until the drawings could be issued or re-issued to reflect changes made in the field. So, instead of one big hearing at the end of construction, there were a plethora of hearings as the project went along. It was impossible to meet any kind of schedule to any degree of certainty. Coupled with component suppliers who had no nuclear experience or located around the world, it was very difficult to have components, drawings and people ready to go at the same place and time.

    Surprisingly, the Chinese had built AP1000s and put them into service years ago. Of course, they have enough skilled people. The plants appear to be working well and the Chinese have taken the design and uprated it for a higher power level.

    Reply

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