[ RadSafe ] Southern Co. Expects Nuclear Loan Agreement By Friday
blreider at aol.com
blreider at aol.com
Tue Jun 15 18:24:10 CDT 2010
SO is planning to build Westinghouse AP1000 reactors. Westinghouse Nuclear is owned in part by Toshiba and to a lesser degree by The Shaw Group, Inc.
Barbara Reider, CHP
From: Perle, Sandy <SPerle at mirion.com>
To: 'radsafe at health.phys.iit.edu' <radsafe at health.phys.iit.edu>
Sent: Tue, Jun 15, 2010 7:00 pm
Subject: [ RadSafe ] Southern Co. Expects Nuclear Loan Agreement By Friday
Southern Co. Expects Nuclear Loan Agreement By Friday
UNE 15, 2010
he Wall Street Journal
NEW YORK (Dow Jones)--Southern Co. (SO) is "on track" to meet the Friday
eadline for accepting a conditional loan guarantee from the federal government
or two new nuclear reactors at the Vogtle plant in Georgia, a Southern
In February, the $14.5 billion Vogtle project became the first new nuclear
eactors in the U.S. to be awarded a loan guarantee by the Department of Energy.
nder the loan guarantee program, the government pledges to cover a company's
ebt obligations if the company defaults on loans used to finance a new nuclear
ower project. Because building a nuclear power plant is a massive,
ulti-billion-dollar undertaking, loan guarantees can be key to financing such
"We are on track to meet the deadline and expect to have an agreement," Southern
pokesman Jason Cuevas said late Monday.
Southern had 90 days to accept the guarantee, but the company was granted a
0-day extension last month. Although Southern hasn't revealed why an extension
as needed, other utilities have expressed concern that the government's upfront
ee for securing credit might be too costly. Utilities have said that in some
ases, the DOE has proposed a fee as high as 10%. The fee is based partly on an
ffice of Management and Budget risk calculation that's used to determine the
ikelihood of loan default.
An Energy Department spokeswoman didn't immediately return a call for comment.
As a large, regulated electric utility with a strong balance sheet, Southern is
ikely to have a lower credit fee than some of the other companies vying for
uclear loan guarantees. NRG Energy Inc. (NRG) and UniStar Nuclear Energy, a
oint venture between Constellation Energy Group (CEG) and French energy giant
DF (EDF.FR), plan to develop new nuclear reactors on a "merchant" basis, which
eans the companies can't recover project costs by raising electric rates.
Southern's partners in the Vogtle project, municipal electric utility MEAG Power
nd public power cooperative Oglethorpe Power, have already accepted their
ortions of the $8.3 billion loan guarantee.
Southern's share of the guarantee would allow the company to borrow up to $3.4
illion. The company expects the new reactors to be completed in 2016 and 2017.
The company can't draw on the loan guarantee until the Vogtle project receives a
ombined construction and operating license from nuclear regulators. Southern
xpects to receive the license by the end of 2011.
Congress has so far appropriated a total of $18.5 billion for the nuclear loan
uarantee program, but the Obama administration asked Congress last month to
pprove $9 billion more for the program.
ander C. Perle
osimetry Services Division
652 McGaw Avenue
rvine, CA 92614
+1 (949) 296-2306 (Office)
1 (949) 296-1130 (Fax)
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