Original nuclear Plant Vogtle cost overruns

Why should we expect Southern Company to be any better at controlling costs now than back in the 1970s and 1980s when its original nukes on the Savannah River went massively over budget? Massively as in 26 times as much per unit as originally projected.

Kristi Swartz wrote for the AJC 30 Jan 2012, A financial look at Plant Vogtle nuclear projects,

From $0.66 to $8.87 billion: original Plant Vogtle nuclear costs When the two original nuclear units at Plant Vogtle were planned, the total cost estimate was $660 million.

Yet, as Jon Gertner reported for NYTimes 16 July 2006,

The plant took almost 15 years to move from blueprints to being operational. And by the time it began producing electricity in the late 1980’s, its total cost, $8.87 billion, was so far overbudget that Vogtle became yet another notorious example of the evils of nuclear energy….

The grand plan was to have four reactors. Instead, it was scaled back to two, Vogtle Unit 1 (finished in 1987) and Vogtle Unit 2 (1989).

That’s right, 4 nuclear units were planned for $660,000,000 fifteen (15) years later only 2 units were built, for $8,870,000,000. That’s more than $8 billion in cost overruns, or more than 13 times the original cost estimate. So per unit, that’s more than 26 times the original estimate, or more than $4 billion per unit.

Swartz provided a handy table of cost estimates by year:

1971 $660 million
1977 $2.7 billion
1981 $5.5 billion
1983 $6.6 billion
1984 $7.2 billion
1985 $8.4 billion
1986 $8.4 billion
1987 $8.9 billion

And of course that $8,870,000,000 is in 1987 dollars. In 2012 dollars that would be about $17,976,000,000. Or about $9 billion a unit.

Why exactly should we expect Southern Company to be able to build two new nuclear units for less than $9 billion each, or $18 billion for two? Probably plus even more cost overruns above that? Back then excuses included new regulations after the Three Mile Island nuclear incident. Those regulations are still in effect, plus new ones. Costs of raw materials, labor, planning, etc. have only increased. So we can only expect SO’s new nukes to cost more than $18 billion.

Southern Company and Georgia Power of course know their own history. Why do you think they organized that three-legged nuclear regulatory-capture stool of a stealth tax on Georgia Power bills, PSC approval of cost overruns, and an $8.33 billion federal loan guarantee? Southern Company isn’t on the hook for any of these cost overruns, or for any potential default on loans. And Georgia Power can charge you even if the new nukes are cancelled! So why are we letting them run up the bill?

You can protest directly to Georgia Power about that CWIP stealth tax on your bill. Or you can contact the GA PSC or the state legislature.