Westinghouse bankruptcy puts $8.3B in federal loan guarantees for Vogtle plant at risk
Nuclear developer Westinghouse Electric's filing for Chapter 11 bankruptcy protection is raising concerns among Trump administration officials about the fate of federal loan guarantees for the sector, Bloomberg reports.
Southern Co. was awarded $8.3 billion loan guarantees issued under the Obama administration for the construction of Vogtle nuclear plant in Georgia.
If Westinghouse terminates its engineering-procurement-construction contract with Southern subsidiary Georgia Power for the Vogtle project, Georgia Power could be required to prepay the outstanding federal loan balance.
The Chapter 11 bankruptcy filing of Toshiba’s Westinghouse unit is raising concerns among many stakeholders. Not the least of them are Trump administration officials worried about the fate of federal loan guarantees extended for the construction of the Vogtle plant in Georgia.
If Westinghouse halts construction on the nuclear power project, it could jeopardize the completion of the entire plant, triggering repayment of the $8.3 billion loan from Southern.
A Department of Energy spokesperson said the agency is "keenly interested" in Westinghouse's bankruptcy proceedings and that the administration expects all companies to "honor their commitments" to finish the project.
If construction of the Vogtle project or the Summer nuclear project being built by SCANA is halted, ratepayers could be left paying higher rates for nuclear plants that do not get built. Both projects have already seen massive cost overruns and multiple scheduling delays.
Consumer groups such as the Southern Alliance for Clean Energy are already raising concerns about the repercussions of Westinghouse’s bankruptcy on ratepayers.
Meanwhile, Bloomberg reports that Southern Co. CEO Thomas Fanning flew to Tokyo to talk to Toshiba CEO Satoshi Tsunakawa last week about finishing the project. The Japanese firm purchased Westinghouse Electric in 2006, but the subsidiary's nuclear construction woes have put the finances of the entire company at risk.
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