Summary
Southern Company (SO) reported on October 20, 2016, that its subsidiary, Georgia Power, reached a settlement agreement with the Georgia Public Service Commission (PSC) Staff regarding the costs associated with the Plant Vogtle Units 3 and 4 nuclear construction project. This settlement addresses prudence matters for costs incurred up to December 31, 2015, and for costs associated with the Westinghouse settlement. It also establishes a revised forecast for in-service capital costs at $5.680 billion, including a contingency, and outlines the burden of proof for costs exceeding this revised forecast.
Key Highlights
- 1Georgia Power and Georgia PSC Staff reached a settlement agreement on the costs of Plant Vogtle Units 3 and 4 as of October 20, 2016.
- 2The settlement resolves prudence matters for approximately $3.3 billion in costs incurred through December 31, 2015, meaning these costs will not be disallowed from rate base on the basis of imprudence.
- 3The settlement deems the Contractor Settlement Agreement with Westinghouse reasonable and prudent.
- 4Financing costs for approved capital costs will be considered prudent if incurred before December 31, 2019 (Unit 3) and December 31, 2020 (Unit 4).
- 5A Revised Forecast for in-service capital costs is set at $5.680 billion, including a $240 million contingency.
- 6Costs up to the Revised Forecast are presumed prudent, with the burden of proof on challenges; costs above the Revised Forecast require Georgia Power to demonstrate prudence.
- 7The certified in-service capital cost for the Nuclear Construction Cost Recovery (NCCR) tariff remains at $4.418 billion, with construction costs above this level accruing AFUDC.