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Georgia Power signs contract for nuclear units
Georgia utilities to evaluate option
PRNewswire
NYSE: SO
ATLANTA - April 8, 2008 - Georgia Power, acting for itself and for Plant Vogtle's co-owners (Oglethorpe Power, Municipal Electric Authority of Georgia [MEAG Power], and Dalton Utilities), entered into an Engineering, Procurement and Construction contract (EPC) with a consortium consisting of Westinghouse Electric Company LLC and The Shaw Group Inc.'s Power Group for the engineering, procurement and construction of two AP1000 nuclear units with electric generating capacity of approximately 1,100 megawatts each and related facilities. Georgia Power expects to submit the EPC to the Georgia Public Service Commission May 1, 2008 as a self-build option in connection with the company's 2016-2017 capacity request for proposal. Oglethorpe Power, MEAG Power, and Dalton Utilities will submit the terms and conditions of the proposal to their respective member utilities or boards, which will have the option of subscribing to rights to various percentages of the units' output. Under the current contractual arrangements, the utilities have the following rights to the units' output: Oglethorpe Power, up to 30 percent; MEAG Power, up to 22.7 percent; and Dalton Utilities, up to 1.6 percent. These groups expect to submit final decisions on output subscription by July 1, 2008. Georgia Power's proportionate share, based on its current ownership interest, is 45.7 percent. The new units would be constructed at the Vogtle Electric Generating Plant site near Augusta, Georgia. The Georgia utilities co-own two existing nuclear units (Units 1 and 2) at the Vogtle site. "Through its Independent Evaluator, the Georgia PSC will review the EPC and competing base load generation bids," explained Oscar Harper, vice president of resource planning for Georgia Power. Georgia Power will select a preferred resource, which will be submitted to the Georgia PSC in August 2008 for approval, with a final certification decision expected in March 2009. If selected by Georgia Power and certified by the Georgia PSC, Vogtle Units 3 and 4 are expected to be placed in service in 2016 and 2017, respectively. The contract terms and conditions are part of a confidential and competitive solicitation monitored by the Georgia PSC's Independent Evaluator. After other bids are submitted, Georgia Power expects to release additional details regarding the project, including the total estimated cost of the plant. Under the agreement, the consortium will supply and construct the entire facility with the exception of certain items provided by the co-owners. Westinghouse and The Shaw Group signed contracts in July 2007 to provide four AP1000 nuclear power plants in China, with initial construction activity for the first plant already underway. Additionally, the AP1000 has been identified as the technology of choice for no less than 12 other proposed nuclear plants in the United States. For more information about the Westinghouse AP1000, visit its Web site at http://www.ap1000.westinghousenuclear.com/. In August 2006, on behalf of Plant Vogtle's co-owners, Southern Nuclear Operating Company, Inc. filed an application with the Nuclear Regulatory Commission (NRC) for an early site permit for new units at the Vogtle site. In March 2008, Southern Nuclear filed an application with the NRC for a combined construction and operating license for the new units. "We expect demand for electricity in the Southeast - specifically in Georgia - to increase significantly by 2015 and beyond," said Mike Garrett, Georgia Power president and CEO. "Nuclear power is a safe, reliable, cost- effective power source that has a low impact on the environment. We are experiencing tremendous price volatility with natural gas and coal and believe we should further balance our portfolio with other fuel sources. It is a prudent business decision to preserve nuclear energy as an option to meet that need. We believe nuclear power is competitive with other generation resources. "Our focus remains on a balanced portfolio of supply-side options, including renewable energy sources," added Garrett. "We will continue to increase our emphasis on energy efficiency and conservation initiatives to reduce energy consumption and demand." Southern Company also continues to support the efforts of the NuStart Energy consortium to test the Nuclear Regulatory Commission's new licensing processes. NuStart Energy and TVA have submitted a Combined Operating License application to the NRC for two Westinghouse AP1000 units at TVA's Bellefonte site in northern Alabama. Georgia Power is the largest subsidiary of Southern Company (NYSE: SO), one of the nation's largest generators of electricity. The company is an investor-owned, tax-paying utility with rates well below the national average. Georgia Power serves 2.3 million customers in all but four of Georgia's 159 counties. Oglethorpe Power Corporation is a $4.9 billion power supply cooperative serving 38 consumer-owned EMCs in Georgia. These EMCs provide retail electric service to approximately 4.1 million Georgians. Oglethorpe Power is the nation's largest electric cooperative in assets, annual kilowatt-hour sales, and ultimate consumers served. The Municipal Electric Authority of Georgia (MEAG Power) is a public generation and transmission organization providing power to 49 Georgia communities with annual electric sales of $721 million and over 10 million- megawatt hours of delivered energy in 2006. Dalton Utilities has operated as a public utility since 1889 and provides potable water, electrical, natural gas and wastewater treatment services to approximately 65,000 customers in the City of Dalton and portions of Whitfield, Murray, Gordon, Catoosa and Floyd counties. In 2003, Dalton Utilities launched OptiLink and now provides broadband, cable TV, telephone and internet services to residential and business customers. Southern Nuclear, a subsidiary of Southern Company, operates Plant Vogtle's two existing nuclear power units for the plant owners. Southern Nuclear also operates the Edwin I. Hatch Nuclear Plant near Baxley, Ga. and the Joseph M. Farley Nuclear Plant near Dothan, Ala. Westinghouse Electric Company, a group company of Toshiba Corporation, is the world's pioneering nuclear power company and is a leading supplier of nuclear plant products and technologies to utilities throughout the world. Westinghouse supplied the world's first Pressurized Water Reactor (PWR) in 1957 in Shippingport, Pa. Today, Westinghouse technology is the basis for approximately one-half of the world's operating nuclear plants, including 60 percent of those in the United States. The Shaw Group Inc. (NYSE: SGR), a 20 percent owner of Westinghouse Electric Company, is a leading global provider of technology, engineering, procurement, construction, maintenance, fabrication, manufacturing, consulting, remediation and facilities management services for government and private sector clients in the energy, chemicals, environmental, infrastructure and emergency response markets. A Fortune 500 company with nearly $6 billion in annual revenues, Shaw is headquartered in Baton Rouge, La., and employs approximately 27,000 people at its offices and operations in North America, South America, Europe, the Middle East and the Asia-Pacific region. For further information, please visit Shaw's Web site at http://www.shawgrp.com/. 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 timing of various regulatory and other actions and plans for new generation resources for Georgia Power. Southern Company and Georgia Power caution that there are certain factors that can 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 Southern Company and Georgia Power; accordingly, there can be no assurance that such suggested results will be realized. The following factors, in addition to those discussed in the Annual Report on Form 10-K for the year ended Dec. 31, 2007 of Southern Company and Georgia Power, and subsequent securities filings, could cause results to differ materially from management expectations as suggested by such forward-looking information: the impact of recent and future federal and state regulatory change, including legislative and regulatory initiatives regarding deregulation and restructuring of the electric utility industry, implementation of the Energy Policy Act of 2005, environmental laws including regulation of water quality and emissions of sulfur, nitrogen, mercury, carbon, soot or particulate matter and other substances, and also changes in tax and other laws and regulations to which Southern Company, Georgia Power and any of their subsidiaries are subject, as well as changes in application of existing laws and regulations; current and future litigation, regulatory investigations, proceedings or inquiries, including the pending EPA civil actions against certain Southern Company subsidiaries, FERC matters, IRS audits and Mirant-related matters; the effects, extent and timing of the entry of additional competition in the markets in which Southern Company's or Georgia Power's subsidiaries operate; variations in demand for electricity, including those relating to weather, the general economy, population and business growth (and declines), and the effects of energy conservation measures; available sources and costs of fuel; effects of inflation; ability to control costs; advances in technology; state and federal rate regulations and the impact of pending and future rate cases and negotiations, including rate actions relating to fuel and storm restoration cost recovery; regulatory approvals related to the potential Plant Vogtle expansion, including Georgia Public Service Commission and Nuclear Regulatory Commission approvals; potential business strategies, including acquisitions or dispositions of assets or businesses, which cannot be assured to be completed or beneficial to Southern Company, Georgia Power, or any of their subsidiaries; the ability of counterparties of Southern Company or Georgia Power to make payments as and when due; the ability to obtain new short- and long-term contracts with neighboring utilities; the direct or indirect effect on Southern Company's or Georgia Power's business resulting from terrorist incidents and the threat of terrorist incidents; interest rate fluctuations and financial market conditions and the results of financing efforts, including Southern Company's, Georgia Power's, and any of their subsidiaries' credit ratings; the ability of Southern Company, Georgia Power, and any of their subsidiaries to obtain additional generating capacity at competitive prices; catastrophic events such as fires, earthquakes, floods, hurricanes, droughts, pandemic health events such as an avian influenza or other similar occurrences; the direct or indirect effects on Southern Company's or Georgia Power's business resulting from incidents similar to the August 2003 power outage in the Northeast; and the effect of accounting pronouncements issued periodically by standard-setting bodies. Southern Company and Georgia Power expressly disclaim any obligation to update any forward-looking information. Photo: NewsCom: http://www.newscom.com/cgi-bin/prnh/20050216/CLW066LOGO ### CONTACT: Georgia Power: Media Relations, +1-404-506-7676, Oglethorpe Web site: http://www.georgiapower.com/ |