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Southern Co. expects to exceed Plant Vogtle budget

Associated Press Modified: August 31, 2012 at 4:15 pm •  Published: August 31, 2012

ATLANTA (AP) — Southern Co. said Friday that it expects to exceed its $6.1 billion construction budget by $87 million as it builds a first-of-its-kind nuclear plant in eastern Georgia.

The Atlanta-based utility did not ask state regulators to approve an increase in its construction spending, which is now estimated to rise to roughly $6.2 billion. However, the company signaled in a regulatory filing that it may ask Georgia's Public Service Commission for a formal budget increase in the future. The utility still faces commercial disputes worth hundreds of millions of dollars and supply issues that could increase costs.

Vogtle is the first nuclear plant approved for construction in a generation. It's being closely watched by a power industry that struggled years ago to build nuclear plants without badly blowing budgets. Even with increased spending, Southern Co. said finishing the two AP1000 reactors at Plant Vogtle is a better deal than the alternative of building gas-fired plants.

"We're building a nuclear facility," said Buzz Miller, executive vice president for nuclear power development at Southern Co. subsidiary Georgia Power. "Our primary focus when we're building it is to build it correctly, build it safely, build it with quality. So when we go about our chores, that is focus number one."

Georgia Power, the lead partner, owns just under half of the plant being built near Augusta. The other owners are Oglethorpe Power Corp., the Municipal Electric Authority of Georgia and the City of Dalton. The total project is estimated to cost around $14 billion.

Construction of the reactors will be delayed seven months, according to the filings. The first unit was supposed to be operating by April 2016 with the second coming online a year later. Georgia Power now says the first reactor will start producing power no sooner than November 2016. Utility executives publicly disclosed that schedule shift in May.

Company officials argued that even the increased spending estimate is cheaper than the $6.4 billion budget approved by the Public Service Commission in early 2009. State regulators later trimmed the construction budget to roughly $6.1 billion because Georgia passed a law making it cheaper for the utility to finance the project.

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