Buried in a great story today on the front page of the Wall Street Journal by Rebecca Smith entitled, "Cheap Natural Gas Unplugs U.S. Nuclear-Power Revival," is the following about 2 nuclear reactors being built in Georgia: "Nagging cost worries, however, are creating friction on both projects. Shaw Group, a Baton Rouge-based construction company hired by both Southern and Scana to build their reactors, recently notified the two utilities it had unanticipated costs, which may exceed $400 million for the two companies, and wants to discuss who should absorb them."
History truly does repeat itself in the new nuclear construction world. Just this cost over-run of $400 million that will be the first of many could build a 450 megawatt natural gas plant.
And I bet that I know who will likely absorb this first $400 million increased cost: the monopoly, captured electricity ratepayers in Georgia and South Carolina. In the case of the Georgia ratepayers, they have been and already are paying each month a nuclear construction surcharge for plants that may operate in 2016 or 2017.
Note: This story was updated based on communications from Mark Williams at Georgia Power. The original version indicated incorrectly that the $400 million overrun was for costs at just the Georgia plants. The story indicates that the $400 million of unanticipated costs are for both the South Carolina and Georgia plants, without any detail about the specific amounts for each.