Australian uranium mining company Paladin accused of ribbing off impoverished Malawi
Australian miner accused of dodging tax in world’s poorest country, The Age, July 11, 2015 –Heath Aston Political reporter Tax avoidance tactics of multinational companies have angered Australians, but an Australian mining firm used such methods in Malawi. Tax avoidance tactics of multinational companies have angered the public and placed pressure on the Abbott government to prevent profits being exported offshore.
But an Australian uranium miner is defending the use of identical methods to reduce its tax bill in the world’s poorest country, Malawi.
Between 2009 and 2014, Paladin Energy moved $US183 million out of Malawi to a holding company in the Netherlands and then on to Australia.
A 15-page report by London-based ActionAid has found the Dutch transfers and a special royalties deal – in which Malawi’s mining minister agreed to drop the initial tax rate applied to the uranium mine from 5 per cent to 1.5 per cent – have cost the Malawi public $US43 million.
In Africa’s poorest nation, where per capita GDP is just $US226 a year and life expectancy 55, that money could provide the equivalent of 39,000 new teachers or 17,000 nurses, according to the aid group……..
Paladin’s tax-free transfers to the Netherlands were a combination of management fees and interest payments on loans initiated in Australia. The company loaded its African subsidiary up with huge debts, leaving the Kayelekera uranium mine in northern Malawi with an 80:20 debt to equity ratio – a financing structure known as “thin capitalisation”.
The Dutch structure allowed Paladin to avoid paying a 15 per cent withholding tax to the Malawi government due to a tax treaty between Malawi and the Netherlands which expired in 2014, saving the company $US7.3 million. Paladin closed the mine in February 2014, citing a “sustained low uranium price”.
ActionAid has accused the company of “treaty shopping” and shortchanging the Malawi people. The country’s nursing ranks have the equivalent of four nurses to every 100 in Australia, despite 10 per cent of Malawi’s population being infected with HIV/AIDS……..http://www.theage.com.au/federal-politics/political-news/australian-miner-accused-of-dodging-tax-in-worlds-poorest-country-20150710-gi6uzv.html
Fuel loaded into Japan’s Sendai #nuclear reactors, amid community doubts on its safety
Reactor in Japan being loaded with nuke fuel before restart ,Stars and Stripes, By By MARI YAMAGUCHI The Associated Press July 7, 2015 TOKYO — A Japanese utility on Tuesday began loading fuel into a nuclear reactor where operations are scheduled to resume next month in the country’s first restart under safety requirements set following the Fukushima disaster.
Kyushu Electric Power Co. said the first four fuel bundles were loaded into the Sendai plant’s No. 1 reactor as of late Tuesday. A crane slowly lifts each bundle out of a cooling fuel storage pool and places it into the reactor, in a round- the-clock operation. The utility plans to finish loading all 157 fuel bundles Friday ahead of final inspections before restarting the reactor around Aug. 10.
All of Japan’s more than 40 reactors are offline for repairs or safety checks. Sendai No. 1 is one of 25 reactors seeking restarts and under safety inspection, as Prime Minister Shinzo Abe’s government wants to operate as many of them as possible …..
The second reactor in Sendai is scheduled to be restarted in October.
While the trade ministry and local municipalities have approved the restart of the two reactors in southern Japan, many residents oppose the plan, citing potential danger from active volcanos in the region. Opponents of the restarts and nuclear experts are also concerned the evacuation plans in case of a disaster may not work effectively.
Mounting risk and costs of new Vogtle nuclear reactors shown at hearing
Hearing on New Vogtle Nuclear Reactors Provides New Information on Mounting Risks and Costs July 7th, 2015 ›
Members of the public voice concerns about the Vogtle expansion at the GA PSC hearing
http://blog.cleanenergy.org/2015/07/07/hearing-on-new-vogtle-nuclear-reactors-provides-new-information-on-mounting-risks-and-costs/Below is a Georgia Utility Update first published on July 1, 2015 by Robert “Bobby” B. Baker, Jr. with Freeman, Mathis & Gary, LLP who serves as SACE’s legal counsel in the ongoing semi-annual Vogtle Construction Monitoring (VCM) review before the Georgia Public Service Commission (PSC). Mr. Baker served three terms as a Georgia PSC Commissioner and he provides an invaluable perspective. SACE has consistently intervened and is extremely concerned about the project’s negative impacts on customers given the significant cost increases and schedule delays that have now eroded any supposed benefits, according to experts who testified at the July 23, 2015 PSC hearing. The audiocast of the hearing is available in two parts: part 1 has the Jacobs/Roetger panel and part 2 continues with Jacobs/Roetger until witness Philip Hayet begins at ~37:33. U.S. taxpayers are also at risk should the project default as $8.3 billion in federal loan guarantees for the project were just recently finalized, more than five years after they were originally offered. Additionally, the proposed expansion poses significant risks to the already imperiled Savannah River. We have added links within Mr. Baker’s article to provide our readers with more information. The Georgia PSC Commissioners will vote on the $169 million in expenditures for docket #29849 on August 18, 2015. To contact the Commission, click here. –Sara Barczak, SACE’s High Risk Program Director
Hearing in Vogtle Review Provides New Information on Project’s Cost by Bobby Baker
At the June 23rd hearing on the 12th Vogtle Construction Monitoring Review the Public Service Commission (“PSC”) Staff expert witnesses provided new information regarding the actual financial impact of the current 39 month delay in the construction schedule for Vogtle Units 3 and 4. While it is hardly newsworthy to report that the Project has fallen further behind schedule and the overall costs have increased, the PSC’s witnesses explained how the cost increases impact each residential ratepayer, quantified the total revenue requirement for the Project and refuted the Company’s claims regarding the alleged benefits of the Project.
Staff Witness Philip Hayet testified that the current 39 month delay would add $319.00 or $6.26 per month to the average residential ratepayer’s bill beginning in April 2016 and continuing to June 2020 in the form of higher fuel costs and Nuclear Construction Cost Recovery (“NCCR”) tariff payments.
Of the additional $319.00 in costs, 59% of the increase or $187.00 would be through higher NCCR monthly charges. The cost increase is especially significant to businesses because the $319.00 increase was for the average residential customer who uses 1,000 kilowatt hours per month. Obviously, electric customers with higher monthly electric usage would be paying significantly more in fuel and NCCR costs.
During cross examination concerning the current cost projection of $7.5 billion for Georgia Power Company’s share of the Project it was disclosed for the first time that the total revenue requirement just for Georgia Power’s share of the Project would be $30 billion. Knowing that the total revenue requirement for the project is four times the construction costs gives consumers an ability to evaluate the total Project costs. The current total revenue requirement for the Project is approximately $65 billion.
In the past few Vogtle reviews it was revealed that the cost for every day of delay is $2 million. This calculation was further clarified when it was explained that it did not contain payment of any taxes. The gross up on the $2 million daily cost with taxes would be approximately $2.92 million.
Finally, the PSC Staff witness refuted the Company’s claims regarding the alleged ratepayer benefits of the Project by testifying that the remaining $2.7 billion in alleged benefits claimed by the Company had shrunk down to no more than $208 million. This figure would be further reduced to negative $300 million if 50% of the production tax credits were removed from the calculation. Based on the Project’s current schedule it is highly unlikely that Unit 4 will be on line by December 31, 2020 to be eligible to receive $522 million in production tax credits.
While the testimony at the June 23 hearing was not reassuring to ratepayers, it did provide a clearer financial picture regarding the true costs of Vogtle Units 3 and 4, and reaffirmed the fact that the Project would see more construction delays.:… http://blog.cleanenergy.org/2015/07/07/hearing-on-new-vogtle-nuclear-reactors-provides-new-information-on-mounting-risks-and-costs/#sthash.NN53E6sH.dpuf
Revelations on the dirty work given to Windscale nuclear cleanup workers – and at Hanford
BBC: People taken from movie theater by police, forced to go in reactor and deal with burning fuel rods — TV: Military picked men off street to battle meltdown — Women, minorities, homeless, and prisoners used by nuclear industry for most dangerous work (VIDEO) http://enenews.com/bbc-police-grabbed-people-movie-theatre-made-reactor-deal-burning-fuel-rods-tv-men-picked-streets-forced-battle-nuclear-meltdown-video?utm_source=feedburner&utm_medium=email&utm_campaign=Feed%3A+ENENews+%28Energy+News%29
BBC, ‘Windscale – Britain’s Biggest Nuclear Disaster’ (emphasis added) — Tom Tuohy, deputy manager at Windscale plutonium production plant (at 8:00 in): “We were trying to push the burning fuel into the back of the reactor.” — But the heat had melted the cartridges, so they were stuck in the core… Radiation was so intense they could only work a few hours. They were running out of firefighters. — Neville Ramsden, Windscale health physicist: “The police from the [plutonium] factory had turned up looking for volunteers and they brought a bus. They decided the best way to get the volunteers was to go up to the cinema, and ‘volunteer’ the back 2 rows at the show to go… push the fuel rods out of the reactor.”
Yorkshire Television, ‘Children of Chernobyl’(at 4:00 in): “When the robots broke down because of the extreme radioactivity, men were sent in to cleanup the site. They werenot volunteers. They were picked up off the streets and press ganged [i.e. taken by force] onto the roof… In 90 seconds, they received their permissible lifetime dose of radiation. The men were sent home and forgotten… They do not figure in any official casualty lists.”
Prof. Kate Brown, C-SPAN (at 35:00 in): “When there was an accident [at Hanford],when there was some dangerous groundthat needed to be worked… they sent in these temporary workers, prisoners from the camps nearby… minority laborers… basically ‘jumpers’ to work in dangerous ground,unmonitored… and they’d leave with the many possible radioactive isotopes they had ingested… without any epidemiological trace… The plutonium cities presented a picture of healthy pink populations, this was a mirage.”
Prof. Brown (at 42:30 in): “That job [of refining plutonium] was often given to women… it’sone of the dirtiest jobs. At Dupont… they’d write the Army Corps, ‘Maybe since we’re going to make this super-poisonous product, we shouldn’t hire women who were younger than the menopausal age. What about fertility problems? What about mutants and monsters in offspring?’ They were real nervous about it… they knew a great deal, and they were worried.”
DC Bureau: When the enormous problem of high-level nuclear waste became apparent… White workers ordered African Americans to deal with this deadly mess, and disposal involveddumping plutonium straight into the soil…. [Mr. Lindsay] was recruited from his job as a segregated school principal to commute several hours from Greenwood, South Carolina… like thousands of other African American workers, was given the most dangerous jobs andordered to throw his dosimeter… in a bucket before going into high risk areas.
Reuters: Police say Japanese gangsters rounded up homeless men to clean up Fukushima radiation… “Many homeless people are just put into dormitories [and] left with no pay at all.”
Anand Grover, United Nations Special Rapporteur (at 15:30 in): “These [Fukushima] workers told me, ‘Do you know we’re actually living in a shanty town?’… Literally on the pavement…in Tokyo… They told me that people come take them.”
Channel 4, ‘Nuclear Ginza’ (1995) — Prof. Kenji Higuchi (at 2:00 in): “The scenes I saw, the stories I heard, I found them difficult to believe at first… Workers go near the reactor and get exposed… Many of them become ill… sometimes die… [They’re] picked off the street in the slums… I found so many… who didn’t know what had happened to them, or if they did,too frightened to speak… all their stories were the same… People simply don’t believe this could happen in a country like Japan… It’s as if they’re the living dead.”
Grim future for France’s nuclear companies AREVA and EDF
Burdened by losses, EDF’s foreign activities are currently unable to finance the increasing requirements at home, where the production costs of nuclear plants are rising by around 5% each year and investment needs are increasing.
The international trend is not for a nuclear renaissance but for a boom in renewable energy, and France will not be able to export significantly more reactors, or to develop new reprocessing contracts abroad under profitable conditions.
To understand just how far the French nuclear industry has fallen in recent years, look no further than the value of EDF and Areva. Since 2007, EDF’s stock price has fallen more than 70%; Areva’s by more than 85%. If Areva weren’t 83% government-owned, it almost certainly would have declared bankruptcy by now.
nuClear News July 15 http://www.no2nuclearpower.org.uk/nuclearnews/NuClearNewsNo75.pdf The deep crisis which the French nuclear industry is experiencing is not new, although it seems to have shocked some commentators. It actually represents the outcome of a strategy launched at the end of the 1990s which was always flawed. The project involved an aggressive export policy which it was hoped would disguise predictable difficulties at home, according to a report by WISE Paris for Greenpeace. (1)
Game Over for UK’s Hinkley Point Nuclear power project?
The UK Government is now said to be deeply concerned about the future of the Hinkley project following revelations about problems at the similar reactor being built at Flamanville
Nuclear needs a blank cheque Now that it is plain that nuclear power has failed miserably to compete with renewable energy even on the somewhat skewed playing field represented by the (proposed) Hinkley C deal, nuclear supporters are trying to engineer a ‘blank cheque’ to be given to nuclear developers
nuClear News, July 15 http://www.no2nuclearpower.org.uk/nuclearnews/NuClearNewsNo75.pdf There is a growing chorus of critics calling for Hinkley Point C to be scrapped altogether, according to the Sunday Times.
It would be one of the most expensive man-made objects ever built in the world. At a cost of £24.5bn it would tie British households into paying for astonishingly expensive electricity subsidies until 2060. The world has changed since 2010 when Hinkley was first named as a site for new reactors. The price of renewables has plummeted.
New renewable energy app from IRENA will help investors
Irena off to a clean start with new renewable energy app, The National Business LeAnne Graves June 30, 2015 The renewable energy sector has been growing fast, and more and more people – particularly potential investors – are seeking information on little known areas to venture into.
Although some forms of renewable energy have been around for decades, there has been almost no mapping of the industry. Sure, companies have looked into their particular areas of interests, but until the International Renewable Energy Agency (Irena), an intergovernmental organisation that supports countries in their transition to a sustainable energy future, launched in 2009, there was little aggregated information available.
The organisation has now created an app to feed hungry minds on the subject – allowing users to search for renewable energy resources anywhere in the world, from sources such as wind, solar or marine, hydro, geothermal and bioenergy. And all this from their smartphone.
Launched last month, the Global Atlas pocket is a free app available for download on all platforms including BlackBerry 10, iOS, Android and Windows Phone.
At present it claims to be the only global tool of its kind, combining 1,000 maps from 67 governments and 50 data centres.
The idea is that users can overlay information listed in the catalogue to help identify areas of interest for potential projects or business ventures…….
What are the pros of this app?
It’s important to remember that this is the first of its kind. So to begin with, Irena needed to grab whatever information is currently available on different markets and regions. It’s not an easy task. But you can select any place in the world to find out how much solar irradiation is present, ask if renewable energy could power 100 per cent of a particular island or even whether wind energy is a suitable prospect for the UAE…….. http://www.thenational.ae/business/the-life/irena-off-to-a-clean-start-with-new-renewable-energy-app
Nuclear industry keen to save US government’s Export-Import Bank
Why the US nuclear industry is eager to save this obscure, government-run bank The US nuclear industry has looked abroad for business as demand in the US has fallen. But without the Export-Import Bank’s backing, some say it would be harder for US companies to seal nuclear deals abroad.Christian Science Monitor, By Jared Gilmour, Staff writer JULY 2, 2015 WASHINGTON — Tucked away in an unassuming building two blocks from the White House is a government-run bank. It helps US companies sell products abroad,……..
Until recently, the bank was relatively low-profile……the Export-Import Bank’s loans and loan guarantees are critical for another domestic industry that has fallen on hard times: US nuclear power. If the bank’s charter isn’t reauthorized, the industry and a host of other business interests say the effects could be devastating for US companies’ overseas prospects……..
Nuclear looks abroad For years, the US nuclear industry has struggled domestically. Cheap natural gas and coal have largely crowded the low-carbon power source out of the market. The recession also put a damper on demand for new US power generation. Safety concerns have made matters worse for US nuclear, and those worries flared up anew after Japan’s Fukushima disaster in 2011. http://www.csmonitor.com/Environment/Energy/2015/0702/Why-the-US-nuclear-industry-is-eager-to-save-this-obscure-government-run-bank
Organization of Canadian Nuclear Industries (OCI) to work with Romania to market nuclear reactors
MOU promotes stronger ties among Canadian and Romanian nuclear suppliers Market Watch, BUCHAREST, Romania, Jul 2, 2015 (Canada NewsWire via COMTEX) — The Organization of Canadian Nuclear Industries (OCI) is proud to announce the signing today of a Memorandum of Understanding (MOU) with the Romanian Atomic Forum Association (ROMATOM)……..
The Partnering Workshop included an update on the planned Cernavoda 3/4 CANDU project as well as presentations by Canadian and Romanian nuclear suppliers on their nuclear capabilities and experience along with discussions on their mutual interest in collaborating on the Cernavoda 3/4 CANDU Project.
This MOU outlines several ways that OCI and ROMATOM will work together including identifying opportunities at nuclear projects in Romania, Canada, and other countries on which OCI and ROMATOM companies can cooperate. The OCI-ROMATOM MOU will also encourage and facilitate cooperation among Canadian and Romanian nuclear research institutes and universities on nuclear research, development, and nuclear education……..
The Canada-Romania Cernavoda 3/4 Supply Chain Partnering Workshop was the focal point of a three day 12 company OCI-led Trade Mission to Romania that kicked off with a July 1 Canada Day Celebration hosted by the Canadian Embassy …… The Trade Mission to Romania was supported by co-funding from Global Opportunities for Associations (GOA) program through which the Foreign Affairs, Trade and Development Canada (DFATD) encourages and supports trade associations in taking member companies into promising export markets.
Organization of Canadian Nuclear Industries (OCI) is an association of 180 leading Canadian suppliers to the nuclear industry in Canada and foreign markets. OCI…provides……engineering services and support to CANDU nuclear power plants in Canada as well as to CANDU and Light Water Reactor (LWR) plants in offshore markets. OCI promotes the continued and expanded use of nuclear energy in Canada and supports member companies in both domestic and international nuclear markets………http://www.marketwatch.com/story/mou-promotes-stronger-ties-among-canadian-and-romanian-nuclear-suppliers-2015-07-02
AREVA to sell its U.S. nuclear radiation measurement business
Areva puts U.S. nuclear radiation business Canberra up for sale PARIS, JUNE 29 French state-owned nuclear group Areva has begun the sale process for the planned disposal of its U.S. nuclear radiation measurement business Canberra, it said in a statement on Monday.
The sale of Canberra is part of a revamp of loss-making Areva, with utility EDF poised to buy its nuclear reactor business. (Reporting by Michel Rose; Editing by David Goodman) http://www.reuters.com/article/2015/06/29/areva-canberra-idUSL5N0ZF0H220150629
Russia aiming to take over the world’s market for nuclear reactors
Russia to tighten grip on global nuclear market with standardised reactors, Global Construction Review, 17 June 2015 | By David Rogers Russia’s state nuclear corporation claims it will start mass-producing nuclear reactors to meet growing demand for nuclear power around the world.
“Something we have and nobody else does is that we have learned to replicate nuclear power plants,” said Valery Limarenko, head of Rosatom’s Atomstroyexport subsidiary, speaking during the Rosatom’s annual conference.
He said: “The serial production of nuclear power plants around the world is a difficult thing to do, but we have managed it because we are building a series of standard designs with options covering seismicity, climate and the other parameters. Our competitive ability is very high because a company that can build a series of projects, has a very strong position on the market.”………http://www.globalconstructionreview.com/news/russia-tighten-grip-glob8al-n4uclea0r6-4m2ar0k8et/
France keen to save AREVA, by selling nuclear reactors to Saudi Arabia
France plans new Saudi nuclear reactors, Sky News 25 June 2015 France has confirmed it is looking into building two nuclear reactors in Saudi Arabia, as part of 12 billion euro ($A17.31 billion) worth of deals struck between the nations.
Under one of the agreements Airbus will sell 23 H-145 multipurpose helicopters to Saudi Arabia for 500 million euros as well as launch a feasibility study into building the reactors, French Foreign Minister Laurent Fabius said on Wednesday……..
The study for two European Pressurised Reactors (EPR) – which France considers the safest and most advanced in the world – takes on added significance given the current efforts by Saudi Arabia’s rival, Iran, to develop its own nuclear capabilities.
In addition to the study, France will sign an agreement to train the Saudis on nuclear safety and the treatment of nuclear waste……
France has been reinforcing links with the conservative kingdom despite persistent criticism of its human rights record,…… http://www.skynews.com.au/news/world/mideast/2015/06/25/france-plans-new-saudi-nuclear-reactors.html#sthash.tI5czLBA.dpuf
Nuclear power a very poor deal for Saudi Arabia
Saudi Arabia must not focus on nuclear power THERE IS LITTLE DOUBT THAT NUCLEAR POWER WILL NOT BE ABLE TO COMPETE ECONOMICALLY WITH SOLAR PHOTOVOLTAIC AND WIND ENERGY BY ALI AHMAD AND M. V. RAMANA, SPECIAL TO GULF NEWS JUNE 25, 2015
Although Saudi Arabia has officially expressed interest in acquiring nuclear power since 2006, it is clear that this effort has gained momentum in the last few months, since the progress of negotiations between P5+1 (United States, Britain, France, Russia, China plus Germany) and Iran over the latter’s nuclear programme. Though some may find it understandable on strategic grounds, it is important to realise that nuclear power fares poorly if compared economically with fast-growing renewable technologies, especially solar photovoltaic energy.
Currently fossil fuel, oil and natural gas-based electricity generation constitutes essentially all of Saudi Arabia’s power production capacity. But it is desirable to develop alternative sources of electricity and both nuclear power and renewables have been held out as possibilities……
Nuclear reactors not only take long periods to construct, but are also prone to major construction delays and huge cost overruns. This is true in many countries, including industrialised economies with substantial nuclear capacity such as the US and France. Even without delays, establishing a nuclear power programme from scratch can take a minimum of 10 years. The UAE, for instance, started its programme in 2008 and expects to connect its first reactor to the grid in 2018. In comparison, solar projects typically have a one to two-year construction period.
If Saudi Arabia, for example, decides to build a nuclear reactor today, it will likely take a minimum of 10 years for it to start generating electricity. Therefore, any cost comparison must be based on what solar power may cost in 2025 rather than today’s costs. This time period is significant and if the dramatic decline in the cost of solar photovoltaic panels over the past decade (more than 75 per cent since 2009) continues till the end of this decade, the cost of generating nuclear power will exceed that of photovoltaic energy. There are good reasons to expect solar power costs to decline further in a similar fashion, including the relative lack of maturity of underlying technologies.
Even without such declines, there is evidence that renewable energy is already more economical than nuclear power. ……
Saudi Arabia is a natural location for investing in solar energy. It has one of the highest Direct Normal Irradiation resources in the world.
Likewise, wind energy too has significant potential in Saudi Arabia. Moreover, there is much greater scope with renewable energy for Saudi Arabia to ensure a higher degree of localisation and create a base of highly skilled workforce. Such localisation is certainly more difficult, if not impossible, to achieve with nuclear power.
Therefore, there is little doubt that nuclear power will not be able to compete economically with solar photovoltaic and wind energy. ….http://gulfnews.com/opinion/thinkers/saudi-arabia-must-not-focus-on-nuclear-power-1.1540888
Tax-payer backed loan guarantees for Vogtle nuclear reactors – still not enough to cover budget
Feds Finalize $8.3 Billion in Taxpayer-Backed Loan Guarantees for Over Budget, Significantly Delayed Vogtle Nuclear Reactors as Alleged “Benefits” to Georgia Power’s Customers Have Eroded, Experts Say http://www.cleanenergy.org/2015/06/24/feds-finalize-8-3-billion-in-taxpayer-backed-loan-guarantees-for-over-budget-significantly-delayed-vogtle-nuclear-reactors-as-alleged-benefits-to-georgia-powers-customers/
Contact: Jennifer Rennicks, SACE, 865.235.1448, Jennifer@cleanenergy.org
Georgia Public Service Commissioners hear concerns from public on troubled project as Department of Energy issues remaining $1.8 billion to MEAG
Atlanta, Ga. (June 24, 2015) ///PRESS RELEASE/// On the heels of Tuesday’s all-day public hearing on the 12th semi-annual Vogtle Construction Monitoring (VCM) report (Docket 29849) at the Georgia Public Service Commission (PSC), which underscored more schedule delays and at least $1.4 billion in cost increases just for Georgia Power’s share of the two Toshiba-Westinghouse AP1000 nuclear reactors under construction at Plant Vogtle near Waynesboro along the Savannah River, the Department of Energy (DOE) issued the remaining $1.8 billion in federal loan guarantees to MEAG, a utility partner in the project. Despite testimony from the PSC Public Interest Advocacy (PIA) staff expert witnesses that identified at least an additional 3-month delay, constituting a 3 1/2 year overall project delay, and stressed that significant obstacles remain that could further derail the schedule, the DOE finalized the remaining portion of the $8.3 billion loan guarantee.
Since the controversial loan guarantee offers were made over five years ago, the Southern Alliance for Clean Energy (SACE) has questioned the risks posed to U.S. taxpayers if the more-than $15 billion nuclear project should default — a reality that plays a large role in the nuclear industry’s history. The loan guarantee terms, including the credit subsidy fees that represent the “price tag” a utility must pay to the federal government for the loan guarantee, were never made readily available to the public. The shocking information that the credit subsidy fee for utility giant Southern Company (subsidiary Georgia Power) and its utility partner, Oglethorpe Power, was nothing, $0, was only disclosed two months after the Department of Energy (DOE) finalized terms of $6.5 billion worth of loan guarantees despite the fact that taxpayers are on the hook should the project default. Now DOE has issued the third partner in the project, MEAG, the remaining $1.8 billion loan guarantee, without making the credit subsidy fee and loan documents public.
“The loan guarantee process has been shrouded in secrecy from Day One and the Vogtle project is a total mess,” said Sara Barczak, high risk energy choices program director with SACE. “We’re immensely frustrated that with all of this information on the problems plaguing this nuclear expansion project that the Department of Energy is still throwing taxpayer money after it.”
Not only are U.S. taxpayers shouldering risks from this project, but over $1.1 billion has already been collected from Georgia Power customers due to state legislation passed in 2009, the Georgia Nuclear Energy Financing Act or Georgia’s “nuclear tax,” which allows Georgia Power to charge customers in advance for financing costs associated with the Vogtle project. This is itemized on customers’ bills under the Nuclear Construction Cost Recovery rider. Expert testimony determined that the average household using 1000 kilowatt hours per month would pay an additional $319 during the delay period of April 2016 through June 2020 or $6.26 per month for additional financing costs and replacement fuel costs.
“During the hearing a shocking $30 billion price tag was revealed for Georgia Power customers over the course of the projected 60-year operating period for the two new Vogtle reactors. We learned that the $5 billion in benefits touted when the reactors were first approved during the certification process have completely evaporated. And the cost of $2 million per day of delay is actually closer to $3 million,” said Barczak. “What more information do the Georgia Public Service Commissioners and state lawmakers need to identify and implement measures to protect consumers from further hardship? The anti-consumer state legislation that allows Georgia Power to charge customers in advance for the project’s massive financing costs, which represent the largest share of the current cost overruns, was a bad experiment that must be corrected and prevented in the future.”
Originally Vogtle reactor Unit 3 was scheduled to come online April 1, 2016 and Unit 4 one year later but expert witnesses for the PSC have identified additional delays, now 42-months, as serious construction challenges remain. The current certified cost for Georgia Power’s share of the project is approximately $6.113 billion. The Company recently increased their cost estimate by 23%, to approximately $7.518 billion. At yesterday’s hearing experts provided even higher estimates: the current projected total cost for Georgia Power’s share, including litigation outcomes, has increased significantly since certification. Expert testimony provided a range from $7.884 billion to $8.578 billion.
“The Construction Monitor stated that original schedule projections had fuel loaded by now. But the reality is that less than 25% of the Vogtle project’s construction has been completed. The project is so delayed that financial benefits, especially the Production Tax Credits, may not even be realized,” said attorney Bobby Baker representing SACE, which has intervened in every VCM. “Only customers in the 2076 to 2080 time period will receive the fuel savings, which represents an enormous intergenerational subsidy benefitting customers 50 or 60 years down the road. Expert testimony confirmed that if a decision were made today, building new nuclear generation is uneconomic.”
SACE remains extremely concerned that decisions by the DOE and other federal agencies were made to put taxpayer money at risk in spite of all of this relevant information showing serious, ever-mounting problems facing the Vogtle project.
Additional information:
For additional background on the $8.3 billion in Vogtle loan guarantees, please view a report analyzing some of the loan guarantee documents SACE received from previous FOIA litigation here and the supplemental memo. Unlike DOE and OMB, the Southern Alliance for Clean Energy has made thousands of pages of documents received publicly available through an online library.
Georgia Power is 45.7% owner in the project (remaining utility partners are Oglethorpe Power (30%), MEAG (22.7%), and the City of Dalton (1.6%)). This means the original approximately $14.1 billion Vogtle project is now estimated to cost at least $16.5 billion, which does not include over $1.1 billion in possible litigation costs. Costs have increased by over $800 million just since the last review.
A Commission decision on whether to approve the $169 million in expenditures during the reporting period will be made by August 18, 2015. The public can submit comments by referencing “Docket 29849” either online via http://www.psc.state.ga.us/content.aspx?c=/commissioners/, by phone at (800) 282-5813 or by regular mail to: Georgia Public Service Commission, 244 Washington Street, SW, Atlanta, GA 30334-9052.
Cost of Georgia’s new nuclear plant erodes recent savings
Analyst: New savings erode as cost of nuclear plant grows WT, RAY HENRY – Associated Press – Tuesday, June 23, 2015 ATLANTA (AP) – The rising cost of building a new nuclear plant in Georgia will swallow most of the $2.7 billion in newfound savings that Southern Co. has publicly touted, a state analyst said Tuesday.
Southern Co. and its partners are building two more nuclear reactors at Plant Vogtle, a project running more than three years behind schedule. Time is money. The longer it takes to build, the more Southern Co. subsidiary Georgia Power must pay in construction and finance
charges.
Since state regulators approved the plant in 2009, power company executives said they secured $2.7 billion in newfound savings, making the project more financially attractive. For example, the utility benefited from cheaper-than-expected borrowing and inflation costs, received government loans and expects to get tax credits.
But the actual savings could be as small as $208 million after subtracting new costs related to the delays, according to financial analyst Philip Hayet, who monitors project finances for the state Public Service Commission. By comparison, Georgia Power now expects to spend $7.5 billion on its share of construction expenses.
“It’s now virtually negligible,” Hayet said, describing the value of the savings identified by the utility. The first of the reactors is supposed to be complete in 2019, with the second following a year later. State monitors have cautioned that construction schedules could see more delays, further decreasing savings. Ultimately, Georgia Power customers will pay for the company’s share of building costs unless the elected members of the PSC intervene.
Read more: http://www.washingtontimes.com/news/2015/jun/23/analyst-slim-savings-as-cost-of-georgia-nuclear-pl/#ixzz3e6jsP41y
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of the week– Nuclear Reactor Information Task Force
14 May – online event From Bombs to Data Centres: the Face of Nuclear Colonialism
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