HOUSTON Dec 12 The U.S. Department of Energy
has extended a deadline to work with Southern Co to
negotiate terms for a federal loan to support construction of
the country's first new nuclear reactor in three decades, a
Southern spokesman said on Wednesday.
The DOE awarded a conditional loan guarantee more than two
years ago for $8.3 billion to a Southern Co-led consortium to
build two 1,100-megawatt nuclear units at the existing Vogtle
nuclear station in Georgia. The new reactors will cost at least
In a letter to Southern Co officials this week, the DOE
extended a deadline for negotiations until June 30, Southern
spokesman Steve Higginbottom said.
In 2010, many utilities were competing for federal loan
support viewed as critical to revive the U.S. nuclear industry
by helping companies avoid the risk of ballooning costs that
accompanied the last round of nuclear construction in the 1980s.
Terms of the Vogtle loan guarantee were expected to be
finalized in mid-2012 once Southern and its partners obtained a
license to build and operate the Vogtle 3 and 4 units from the
U.S. Nuclear Regulatory Commission in February, but the process
bogged down over the terms and costs.
Southern unit Georgia Power's share of the loan guarantee is
about $3 billion.
Negotiations were further complicated when the DOE added
requirements following the much publicized bankruptcy of solar
panel maker Solyndra, which had received $500 million in loan
Southern's Chief Executive Tom Fanning has said the company
is willing to complete the new reactors without federal loan
support if necessary.
"I've got to be convinced that whatever terms and conditions
we enter into ultimately work to the benefit of our customers,"
Fanning told Reuters in July. "If they don't, we don't need the
Higginbottom said the project can be financed through the
capital markets if no loan guarantee is finalized. "That has
been our position throughout the process," he said.
The new Vogtle units are scheduled to come online in 2016
and 2017, but a delay in obtaining the NRC license and disputes
between the owners and the construction consortium are likely to
delay the completion timeline.