While existing US nuclear plants may face an increasingly uncertain future, the new reactors being built by a consortium led by Southern Company in Georgia are at least making reasonably good progress, so far.
The Vogtle 3 and 4 reactors, using Westinghouse AP1000 designs, are the most-watched project in the US nuclear industry. If they can be delivered acceptably close to their planned schedule and budget, they will encourage other companies – in regulated power markets where they can have some assurance of their returns – to press ahead with their own projects.
If costs and delays mount, they will stamp out what faint stirrings of the once-expected “nuclear renaissance” in the US still exist.
The first new unit at Vogtle is now scheduled to be completed by the end of 2017, with the second a year after. That is more than 18 months later than the initially scheduled date of April 2016, but the company blames delays in securing regulatory approval for much of that.
The budget was originally set at about $14bn. Southern said last year the cost had risen by $737m, which it wanted to pass on to customers, but later withdrew that request, and the plan now is to assess the budget once the first new reactor is finished.
While the delays have increased costs, the cost of finance has fallen. The government loan guarantee, expected to cover about $8.3bn of debt, is worth only about $200m to the project, Southern says. Much more important has been the fall in interest rates, because capital costs are such a large proportion of the total lifetime expense of a nuclear plant. In total, Southern believes the project has saved about $2bn in financing costs.
The most direct beneficiary of Southern’s experience will be Scana, which is leading a consortium building two more AP1000s at its Summer plant in South Carolina, and has been in close contact with the team at Vogtle. Whether any other companies choose to take advantage will depend on how well construction goes over the next four years.