Secret sweetheart deal for Georgia nuclear reactors puts taxpayers at risk

Guest Blog | April 25, 2014 | Energy Policy, Nuclear
Southern Company’s Vogtle site in March 2014. Photo provided by Tom Clements of Savannah River Watch.

Earlier this week, shocking news was released regarding $6.5 billion in taxpayer-backed federal loan guarantees for two new nuclear reactors at Plant Vogtle in Georgia. Two partners in the project, Georgia Power (subsidiary of Southern Co.) and Oglethorpe Power, had to pay $0, zip, nothing for something known as the “credit subsidy fee” — essentially money the companies would pay that protects taxpayers should the utilities default on the loan. The third partner, MEAG, is still waiting for an additional $1.8 billion in loan guarantees for the Vogtle project to be finalized later this summer. This “no money down” deal is terribly risky and unfair for taxpayers. To demand that the Government Accountability Office conduct a thorough and speedy investigation of the Department of Energy’s $6.5 billion sweetheart deal to these big power companies before another $1.8 billion is squandered, please sign this petition.

Below is a guest post by Institute for Southern Studies Editorial Director, Sue Sturgis. This piece was originally posted on the Institute for Southern Studies’ blog, Facing South.

INSTITUTE INDEX: Secret sweetheart deal for Georgia nuclear reactors puts taxpayers at risk

Amount the U.S. Department of Energy is providing in loan guarantees to Southern Company subsidiary Georgia Power and partner Oglethorpe Power to build two new reactors at the Vogtle nuclear power plant near Augusta, GA: $6.5 billion

Dollar amount the DOE typically charges in credit subsidy fees for such loan guarantees to cover the risk borne by U.S. taxpayers should anything go wrong with the project: several hundred million

Amount the DOE is charging Georgia Power and Oglethorpe Power in credit subsidy fees for the Vogtle project, according to documents released in response to a journalist’s Freedom of Information Act request: $0

Number of times the Southern Alliance for Clean Energy took DOE to court to get it to release some information about the Vogtle deal, though the government did not disclose the free credit offering to the watchdog group: 2

Amount that Constellation Energy Group, now a subsidiary of Exelon Corp., was asked to pay in credit fees for a loan guarantee for a Maryland reactor, leading it to cancel construction plans: $880 million

Year in which the Government Accountability Office issued a report that said if DOE underestimates the credit subsidies, “taxpayers will ultimately bear the costs of defaults”: 2012

Amount the DOE charged in credit subsidy fees for a $535 million loan guarantee for solar-panel maker Solyndra, which later went bankrupt, leading to political attacks by House Republicans against the Obama administration: $0

Number of months that the Vogtle project is already behind schedule: 21

Amount that it is already over budget: $1 billion

Current total estimated cost of the Vogtle project: more than $15 billion

Year in which the top U.S. nuclear regulator predicted that nuclear power would someday be “too cheap to meter”: 1954

Percent by which cost estimates for new nuclear reactors grew between 2002 and 2008: 200 to 400

Number of new reactors for which companies sought construction permits from the Nuclear Regulatory Commission between 2007 and 2009: 30

Number of those proposed reactors that are actually being built amid problems including a lack of financing and uncertainty following Japan’s Fukushima nuclear disaster: 4

Percent of those reactor projects that are behind schedule and over budget: 100

Number of U.S. and international organizations that have formally rejected nuclear power as a solution to the climate crisis due to its high cost, slow deployment, and serious safety risks: more than 800

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