The Vogtle nuclear power plant. Photo: Pallava Bagla/Corbis via Getty Images
The only nuclear power project under construction in the U.S. will proceed after co-owners reached an 11th-hour deal Wednesday on how to handle further cost overruns.
Why it matters: For days, the future of Southern Company's delayed, way-over-budget construction of two new reactors at its Vogtle plant has been cloudy.
A decision to halt the now-$27 billion project would have been another major wound to the badly struggling U.S. nuclear industry.
The new reactors are slated to come online in 2021 and 2022.
The details: Under the arrangement described in this filing, Southern subsidiary Georgia Power, which has a 45.7% stake in the project, agreed to assume a larger share of future cost increases. Per the Securities and Exchange Commission filing:
They're on the hook for 55.7% of increases of up to $1.6 billion, and 65.7% of increases up to $2.1 billion.
And if costs balloon even more, the other owners could sell a portion of their stake to Georgia Power in exchange for Georgia Power agreeing to pay their share of those overruns.
Plus: "In this event, Georgia Power would have the option of cancelling the project in lieu of purchasing a portion of the ownership interest of any other Vogtle Owner."
The other owners of the project are the Oglethorpe Power, the Municipal Electric Authority of Georgia, and Dalton Utilities.
"The decision to continue construction of the Vogtle plant is a win for Southern and a boon for the fragile U.S. nuclear industry."
"The Department of Energy warned last week that cancelation of the project would strike a blow to the teetering sector and prompt the repayment of billions in federal loans."
