ATLANTA (AP) — The political pushback has started in Georgia over the rising cost of building one of the first new nuclear plants in a generation.
Rep. Jeff Chapman, R-Brunswick, said he will file legislation Thursday seeking to shave the profits of Southern Co. subsidiary Georgia Power if it breaks its state-approved budget of roughly $6 billion while building two nuclear reactors at Plant Vogtle (VOH'-gohl) near Augusta.
Electric customers would still reimburse the utility for its actual construction expenses and borrowing under Chapman's plan. But the firm would earn a reduced profit on any investments that exceeded the state-approved budget. Chapman's proposal comes as utilities building nuclear plants in Georgia, South Carolina and Tennessee are under pressure to control costs.
As a regulated monopoly, Georgia Power earns a more than 11 percent profit on every dollar it spends on capital infrastructure, including the nuclear plant.
"There's really no incentive for them to stay within those boundaries," Chapman said.
Georgia Power spokesman Mark Williams said the company had not seen Chapman's plan and could not comment on it. Williams said state utility regulators have reviewed and approved all of the utility's spending.
A draft of the legislation provided by Georgia Watch would require that Georgia Power's 2.4 million customers reimburse the company for its actual construction costs. However, the utility would earn a much lower return on its investment for any spending that goes over an original $6.4 billion construction budget set by the Georgia Public Service Commission. That cap was later lowered to roughly $6.1 billion after state lawmakers in 2010 permitted the utility to charge its customers in advance for the project's financing costs.