ATLANTA, Oct. 27, 2015 /PRNewswire/ -- Georgia Power announced today that the contractors for the Vogtle nuclear expansion, Westinghouse and CB&I, have entered into a transaction that will position Westinghouse and its affiliates as the sole contractor over the project. As a result, Georgia Power and the other Vogtle co-owners (Oglethorpe Power Corporation, Municipal Electric Authority of Georgia and Dalton Utilities) have agreed on terms to settle all claims currently in litigation with the project's contractors and to include additional protections in the engineering, procurement, and construction (EPC) contract against future claims.
"This settlement is extremely positive for the Vogtle project and now the contractors can focus 100 percent on project execution," said Buzz Miller, executive vice president of nuclear development for Georgia Power. "The agreement resolves current and pending disputes, reaffirms the current schedule and increases efficiencies by streamlining resource deployment with Westinghouse and its affiliates as the prime contractor over the Vogtle expansion."
Including this settlement, the project's incremental impact on customer rates will average less than 1 percent per year until the project is complete. Georgia Power's portion of the settlement cost is approximately $350 million, which is significantly less than current litigation claims.
The agreement also reaffirms the current in-service dates of 2019 for Unit 3 and 2020 for Unit 4. Construction of the new units near Waynesboro, among the first to be built in the United States in more than three decades, is progressing well and more than halfway complete based on contractual milestones. The expansion remains the most economic choice for meeting the future energy needs of Georgia. Once units 3 and 4 join the existing two Vogtle units already in operation, Plant Vogtle is expected to generate more electricity than any U.S. nuclear facility, enough to power more than one million homes and businesses.
The settlement is subject to completion of the Westinghouse and CB&I transaction.
Southern Nuclear, a subsidiary of Southern Company, is overseeing construction and will operate the two new 1,100-megawatt AP1000 units for Georgia Power and co-owners Oglethorpe Power Corporation, the Municipal Electric Authority of Georgia and Dalton Utilities. Georgia Power owns 45.7 percent of the new units.
About Georgia Power
Georgia Power is the largest subsidiary of Southern Company (NYSE: SO), one of the nation's largest generators of electricity. Value, Reliability, Customer Service and Stewardship are the cornerstones of the company's promise to 2.4 million customers in all but four of Georgia's 159 counties. Committed to delivering clean, safe, reliable and affordable energy at rates below the national average, Georgia Power maintains a diverse, innovative generation mix that includes nuclear, 21st century coal and natural gas, as well as renewables such as solar, hydroelectric and wind. Consistently recognized as a leader in customer service, Georgia Power was recently ranked highest in overall business customer satisfaction among large utilities in the South by J.D. Power and Associates. For more information, visit www.GeorgiaPower.com and connect with the company on Facebook (Facebook.com/GeorgiaPower) and Twitter (Twitter.com/GeorgiaPower).
Cautionary Note Regarding Forward-Looking Statements
Certain information contained in this release is forward-looking information based on current expectations and plans that involve risks and uncertainties. Forward-looking information includes, among other things, statements concerning the expected terms of the proposed settlement and the expected benefits therefrom, the anticipated schedule for completion of Plant Vogtle Units 3 and 4, and the expected impact on customer rates. Georgia Power cautions that there are certain factors that could cause actual results to differ materially from the forward-looking information that has been provided. The reader is cautioned not to put undue reliance on this forward-looking information, which is not a guarantee of future performance and is subject to a number of uncertainties and other factors, many of which are outside the control of Georgia Power; accordingly, there can be no assurance that such suggested results will be realized. The following factors, in addition to those discussed in Georgia Power's Annual Report on Form 10-K for the fiscal year ended December 31, 2014, and subsequent securities filings, could cause actual results to differ materially from management expectations as suggested by such forward-looking information: the ability of Westinghouse to complete the proposed transaction with CB&I; the impact of recent and future federal and state regulatory changes, as well as changes in application of existing laws and regulations; current and future litigation, regulatory investigations, proceedings, or inquiries; available sources and costs of fuels; the ability to control costs and avoid cost overruns during the development and construction of facilities, which includes the development and construction of facilities with designs that have not been finalized or previously constructed; state and federal rate regulations and the impact of pending and future rate cases and negotiations, including rate actions relating to fuel and other cost recovery mechanisms; the ability to construct facilities in accordance with the requirements of permits and licenses, to satisfy any environmental performance standards and the requirements of tax credits and other incentives, and to integrate facilities into the Southern Company system upon completion of construction; advances in technology; legal proceedings and regulatory approvals and actions related to Plant Vogtle Units 3 and 4, including Georgia Public Service Commission approvals and Nuclear Regulatory Commission actions and related legal proceedings involving the commercial parties; and the ability of counterparties of Georgia Power to make payments as and when due and to perform as required. Georgia Power expressly disclaims any obligation to update any forward-looking information.
SOURCE Georgia Power