Nuclear Cost Blowouts Caused 25 Percent Energy Price Hike in Georgia: Energy Consultant

The cooling towers of the nuclear power plant in Nogent-sur-Seine, France, on Nov. 8, 2024. Bertrand Guay/AFP via Getty Images

An Australian parliamentary committee has heard that the cost blowouts of two nuclear power reactors have caused significant electricity price hikes in Georgia, the United States.

At a recent inquiry hearing into nuclear power, Patty Durand, the president of Cool Planet Solutions, a Georgia-based energy consulting company, shared her insight on the negative impacts of building nuclear reactors in her state.

According to Durand, Georgia completed two AP1000 nuclear reactors for Plant Vogtle, a four-unit nuclear power plant, in the summer of 2023 and April 2024, respectively, after over a decade of construction.

The budget was initially estimated to be US$11 billion (AU$16.9 billion), but by the time construction was finished, it had ballooned to US$36 billion.

The president said the price tag for two nuclear reactors that could produce around 2,200 megawatts was “ridiculous.”

“The total cost of these two reactors is $36 billion, an astonishing amount of money for one state to spend on one power plant,” she told the Select Committee on Nuclear Energy.

“I remind you and everyone that Georgia is not a rich state. We are the 10th poorest state in the United States. We’re going to be paying for it for 60 years.”

Durand then stated that a sharp rise in electricity prices for the residents followed.

“That plant raised Georgia’s power rates [by] 25 percent alone, after years of being told that they were going to raise rates only modestly, just 3 or 4 percent,” she said.

As a result, a considerable number of people were disconnected from the power grid and could not pay their bills.

“The disconnection rate for people unable to pay has spiked over 20 percent this year,” Durand said.

“That represents tens of thousands of Georgians who are disconnected from power, causing a great deal of pain and backlash that we’ve seen online, with tens of thousands of complaints to the Public Service Commission … and many complaints to our state legislature.”

Corruption Allegation

Durand alleged that one reason for the significant cost overruns in the two reactors was corruption and the misbehaviour of those in charge of the project.

She cited a similar project by the state of South Carolina, which had the same size and design and commenced in the same year with Georgia’s two nuclear reactors.

The project involved building two reactors for Plant Summer and was expected to commence operation in 2020

However, Carolina abandoned it in 2017 due to the enormous cost blowouts.

“State officials there realised that their people could not bear the cost. It was impossible,” she said.

“And then state officials decided to investigate what happened. Why were the costs so severe? How were they caught off guard? The state spent $8 billion on something they never got.”

The president said investigations revealed lying, deception, and illegal behaviour by Westinghouse, a corporation responsible for the construction, utility officials, and state officials. Many of these officials went to jail and had to pay millions of dollars in fines.

While Georgia did not investigate the cost blowouts, Durand believed the same corruption problem occurred in her state.

“Because there was so much deception and lying that happened with Plant Summer, the Commission in Georgia decided. Decided not to cancel Plant Vogtle,” she said.

“I don’t have any proof, but I believe they did not want a similar investigation to take place in Georgia, which would also reveal the same deceptions here that took place there.”

The operating floor inside a reactor at the Kashiwazaki-Kariwa nuclear power station in Kashiwazaki, Japan, on Aug. 6, 2024. Yuichi Yamazaki/AFP via Getty Images

Maintenance Cost Issues

A member of the Committee noted that despite the substantial capital costs, a nuclear plant can last for a long time.

Thus, the costs could be spread over its entire lifespan compared to replacing industrial-scale renewables every 15–20 years.

In response, Durand said nuclear power stations did not last as long as some people said.

“I understand that nuclear Proponents claim that a nuclear plant can last 60 years, but there is no plant on Earth that is that old. The oldest one in the United States is in the 40s,” she said.

In addition, the energy professional said nuclear power plants had a lot of expensive maintenance and repair requirements.

“As they age, they’re so expensive. That’s why they [have been] shut down in the United States,” she said.

“They can’t compete because it’s so expensive to keep them running and to keep the maintenance going.

“I don’t know exactly when it becomes very problematic, but if you have replaced a lot of the nuclear plants, pumps and valves and concrete and fittings and all of the metal works, it’s not competitive at all.”

Durand also questioned the U.S. Department of Energy’s call for building nuclear reactors instead of investigating the money in renewable energy.

“The Department of Energy is calling for 200 more AP1000 [reactors], costing trillions of dollars,” she said.

She suggested that building renewables was the better economic decision.

“But renewables—we might overbuild them when they cost like an eighth to a tenth of the cost of a nuclear plant for the same amount of megawatts. It seems like a ridiculous comparison to me.”

Nuclear Power Makes Ontario’s Electricity Prices Cheaper than Australia’s

Meanwhile, Chris Keefer, the president of advocacy group Canadians for Nuclear Energy, told the Committee how nuclear power contributed to low energy prices in the Canadian state of Ontario.

He said nuclear power accounted for 60 percent of Ontario’s grid. The province completely phased out its coal fleet in 2014, which he said was “North America’s greatest greenhouse gas reduction.”

“Nuclear is the second cheapest source of electricity on Ontario’s grid after hydroelectricity,” he said, citing data from Edgardo Sepulveda, an independent energy economist.

“The cumulative 1977 to 2022 inflation adjusted unit price for nuclear power is CA$86 (AU$94) per megawatt hour. This has exerted downward pressure on electricity prices, resulting in retail rates that are two-thirds the cost and one-sixth the emissions intensity of Australia.”

At the same time, Keefer said nuclear reactors generated a powerful economic multiplier effect, producing CA$1.40 in economic activity for every dollar spent.

“This is achieved through a 95 percent Canadian-based supply chain, stimulating the local economy rather than funnelling billions of dollars to foreign suppliers that dominate the wind and solar sectors,” he said.

Keefer also shared that Ontario was refurbishing the province’s nuclear fleet to extend its lifespan by another 30 years.

As the refurbishment works are being completed on budget and ahead of schedule, he said Ontario authorities had contrived a plan for building an additional eight reactors.