If Plant Vogtle’s Units 3 and 4 ever operate, Georgia Power executives told the state Public Service Commission on May 11 it won’t be by the 2019 and 2020 in-service dates the utility has stood by until only recently. When and if the new nuclear units can be completed—and at what final cost—remains the central question as the utility continues to grapple with how to deal with bankrupt contractor Westinghouse Electric Co.
“The contractor’s performance continues to fall short of both the contractor’s schedule projections and the company’s expectations. Based on the information that the company has subsequently obtained, the company does not believe these in-service dates are achievable,” said David McKinney, vice president of nuclear development with Georgia Power, during the May 11 hearing on the 16th Semi-Annual Vogtle Construction Monitoring report.
Georgia Power and the other Vogtle owners are continuing to conduct a comprehensive schedule and cost-to-complete assessment, as well as a cancellation cost assessment.
On May 12, Georgia Power announced it had reached a new agreement with Westinghouse to take over project management of the Vogtle expansion during bankruptcy proceedings.
Vogtle construction is continuing under an interim assessment agreement, which was enacted as a result of Westinghouse’s March 29 filing for bankruptcy protection. That interim agreement is set to remain in place until June 3 as the parties work to finalize the new service agreement and obtain approvals from the bankruptcy court for Georgia Power to take over the project.
“Georgia Power and the other Vogtle owners are continuing to conduct a comprehensive schedule and cost-to-complete assessment, as well as a cancellation cost assessment, to determine the impact of the Contractor’s bankruptcy filing on the construction cost and schedule for Plant Vogtle Units 3 and 4,” stated an 8-K informational filing Georgia Power owner Southern Company filed on May 12 with the Securities and Exchange Commission.
SCANA Corp., owner of the nearly identical V.C. Summer nuclear expansion project in Jenkinsville, S.C., announced in late April that it had extended its interim assessment agreement with Westinghouse until June 26.
Nearly eight years into construction, Georgia Power is still trying to determine when the 2,200-MW project—originally scheduled to start going online in 2016—might start operating. In 2015, the owner extended the two units’ in-service dates to June 2019 and June 2020. It recently revised those dates to December 2019 and September 2020—still ahead of the current Jan. 1, 2021 deadline requirement for billions of dollars in federal tax subsidies.
During the May 11 hearing, a PSC representative asked why Georgia Power needs to reexamine, yet again, the project schedule it stood behind as late as November.
Quest for the Nuclear Power Project's Status
McKinney said the nature of the engineering-procurement-construction contract hindered the utility’s full understanding of project activities.
“There were parts of the contractor’s procurement … that weren’t available to us prior to the bankruptcy, because of the firm-price, EPC nature of our deal with our contractor,” he said. “We weren’t able to necessarily see the procurement they’d done – how much pipe they had bought versus not bought. What’s the status of the procurement around modules and equipment? Some of those quantities and the status of the materials bought … are now becoming available to us.”
As ENR previously reported, in November 2014 state construction monitor Bill Jacobs testified the project was proceeding without an official schedule. Said Jacobs at the time: “A complete integrated project schedule through the commercial operation date of each unit has not been provided.”
Jacobs, in testimony, predicted that Vogtle would be further delayed because of delays and a lack of schedule. “It is impossible to determine a reasonable forecast range as to when the units could be commercially available,” Jacobs said.
At the most recent hearing, Georgia Power defended its management. “We put in place an EPC contract that made the contractor responsible for those costs, for the risks of those costs ... it is unfortunate that they’ve filed for bankruptcy,” McKinney said.
In the May 12 8-K, Southern said it and Vogtle co-owners are continuing negotiations regarding the financial guarantee with Westinghouse owner Toshiba. During the hearing, McKinney said that he believes that Toshiba’s guarantee would be unsecured if Toshiba were to file bankruptcy.