Dalton Utilities CEO Tom Bundros says the two new nuclear units being built at Plant Vogtle will supply 10 percent of the utility's electricity.

DALTON, Ga. — In December, members of the Georgia Public Service Commission (PSC) unanimously voted to allow Georgia Power, which owns 45.7 percent of the two nuclear plants at Plant Vogtle near Waynesboro in eastern Georgia, to continue to build two new nuclear reactors at the site. They are the first new nuclear reactors to be licensed in the United States since the 1970s.

That project is approximately five years behind schedule and according to some published news reports approximately $11 billion over budget and almost came to a halt last spring when lead contractor Westinghouse Electric Co. filed for bankruptcy, so the PSC’s vote was not guaranteed. But PSC members said it is important to diversify the state’s sources of electricity.

Dalton Utilities owns 1.6 percent of Plant Vogtle, with Oglethorpe Power owning 30 percent and the Municipal Electric Authority of Georgia (MEAG Power) owning 22.7 percent.

The Daily Citizen-News spoke recently with Dalton Utilities CEO Tom Bundros about Plant Vogtle, the PSC vote and their impact on Dalton Utilities and its customers.

The Daily Citizen-News: What would have been the impact on Dalton Utilities if the PSC had not allowed Georgia Power to proceed?

Bundros: Dalton Utilities would have met with the other co-owners to determine whether or not to go forward with the project. Since the PSC doesn’t regulate Oglethorpe Power/MEAG/Dalton/Utilities the economics to go/no go would not have been affected by the PSC’s regulatory treatment of Georgia Power.

If all of the co-owners were to agree to cancel the project, the outcome would be a) Dalton Utilities would have to procure replacement energy; b) Dalton Utilities would have an unrecovered investment of $90 million.

DCN: In a January 2016 interview with this paper, you said that the project was going well, and said, “The actual shells of the buildings are substantially complete. Vogtle unit three is scheduled to be online in the summer of 2019 and unit four in the summer of 2020.” Georgia Power now says unit three will be online in 2021 and unit four in 2022. I think that is five years behind the original schedule. What has caused those delays, and do you think Georgia Power has kept you fully informed of all the problems?

Bundros: In January of 2016, the online dates of summer 2019/2020 I gave you were the dates WEC (Westinghouse Electric Co.) committed to at their settlement with the co-owners on Dec. 31, 2015. Since that time, Westinghouse’s filing of bankruptcy has led to the delay of those plants coming online. Georgia Power has kept us fully informed.

DCN: Will nuclear be competitive price-wise with natural gas?

Bundros: It depends upon your time horizon. Gas prices have been very volatile over the last several years. When construction of these units started in 2008, gas prices were between $6.75 and $13 per mmBTU (one million British thermal units). At those price points, nuclear generation is competitive with natural gas. The advantage of nuclear is the price stability of the fuel versus market volatility of natural gas prices. As a point of reference, the electrical output of the first two Vogtle units has been the lowest-cost and most-reliable source of electricity for Dalton Utilities for the past 25 years. When managing an overall supply of electricity, it’s best to have diverse fuel supply behind the electric generation.

DCN: What will be the impact on Dalton Utilities’ customers of the costs of building these two units, particularly given the cost overruns?

Bundros: To put it in perspective, these new units will only provide 10 percent of our electric supply. Even with the new cost projections, the cost of electricity from the new Vogtle units will fall in the middle price range of our current (electric) resources.