"Burning money" graphic by Gene Case, Avenging AngelsRebecca Smith has reported in the Wall Street Journal that the "[m]odular method has run into costly delays and concerns about who will bear the brunt of the expense."
Joseph "Buzz" Miller, Georgia Power's executive vice president for nuclear development, is quoted as saying "The promise of modular construction has yet to be seen."
The two proposed new Toshiba-Westinghouse AP1000 reactors, Vogtle Units 3 & 4, that Georgia Power is building are years behind schedule, and billions of dollars over budget. $8.3 billion in federal nuclear loan guarantees, awarded by the Obama administration at no cost to the nuclear utilities, would leave taxpayers holding the bag if the project defaults on its loan repayment.
That's 15 times the amount of taxpayer money at risk than was lost to the U.S. Treasury with the Solyndra solar loan guarantee default several years ago.
The article also reports: "Stephen Byrne, president of South Carolina Electric & Gas [SCE&G], recently told investors his company is in discussions with Westinghouse and CB&I [Chicago Bridge & Iron] about the cost overruns and who will bear the burden. Utilities want those added costs to be shared, getting vendors to pay for some of the added expense but vendors are examining the claims. 'We feel that there’s an opportunity for a settlement in the future,' he said."
The two AP1000s under construction at Summer nuclear power plant in SC have been financed by repeated "Construction Work in Progress" (CWIP) surcharges on ratepayer electricity bills over the past many years. Such a "nuclear tax" is illegal in most states.
These cost overruns and schedule delays were to be expected, based on the previous history of nuclear power in the U.S. and overseas.
In 1985, Forbes wrote "The failure of the U.S. nuclear power program ranks as the largest managerial disaster in business history, a disaster on a monumental scale."
In fact, ironically enough, Vogtle Units 1 & 2 were the poster children for cost overruns, coming in at 1,300% their originally estimated price tag.
And the Watts Bar Units 1 & 2 are the case studies in atomic reactor schedule delays. Watts Bar took from 1973 to 1996 to become operational. Watts Bar 2 began construction in 1972, and is still struggling to begin generating electricity, 23 years later!
Such problems extend overseas, as well. A decade-long delay, and huge cost overruns, at the Olkiluoto new reactor construction site in Finland have led to major lawsuits between the nuclear utility, TVO, and the bankrupt French reactor vendor, Areva, to determine who is liable.