Item 8.01 Other Events.
On January 11, 2023, Georgia Power Company ("Georgia Power") announced that
during the start-up and pre-operational testing for Plant Vogtle Unit 3,
Southern Nuclear Operating Company, Inc. ("Southern Nuclear") identified, and is
in the process of remediating, vibrations associated with certain piping within
the cooling system. Southern Nuclear expects to file a license amendment request
with the U.S. Nuclear Regulatory Commission ("NRC") to help expedite the
remediation. As a result, Georgia Power now projects that initial criticality
will occur during February 2023 and that Unit 3 will be placed in service during
April 2023.
Extension of the in-service date for Unit 3 beyond the first quarter 2023 is
estimated to result in additional base capital costs for Georgia Power of up to
$15 million pre tax per month, as well as the related allowance for funds used
during construction and any additional related construction, support resources,
or testing costs.
The projected schedule for Unit 3 primarily depends on progression of start-up,
final component, and pre-operational testing, which may be impacted by equipment
or other operational failures. Ongoing or future challenges also include
management of contractors and vendors; subcontractor performance; supervision of
craft labor and related productivity; ability to attract and retain craft labor;
and/or related cost escalation. New challenges also may arise which may result
in required engineering changes or remediation related to plant systems,
structures, or components (some of which are based on new technology that only
within the last few years began initial operation in the global nuclear industry
at this scale). These challenges may result in further schedule delays and/or
cost increases.
Further updates will be provided in connection with The Southern Company's
("Southern Company") earnings call in February 2023. The ultimate outcome of
these matters cannot be determined at this time.
Cautionary Note Regarding Forward-Looking Statements
Certain information contained in this Current Report on Form 8-K 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 cost and schedule for completion of
construction and start-up of Plant Vogtle Unit 3. Southern Company and Georgia
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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 Southern Company's and Georgia Power's Annual Reports on
Form 10-K for the year ended December 31, 2021, and subsequent securities
filings, could cause actual results to differ materially from management
expectations as suggested by such forward-looking information: the potential
effects of the continued COVID-19 pandemic; the ability to control costs and
avoid cost and schedule overruns during the development, construction, and
operation of facilities or other projects, including Plant Vogtle Units 3 and 4,
which includes components based on new technology that only within the last few
years began initial operation in the global nuclear industry at this scale, due
to current and/or future challenges which include, but are not limited to,
changes in labor costs, availability and productivity, challenges with
management of contractors or vendors, subcontractor performance, adverse weather
conditions, shortages, delays, increased costs, or inconsistent quality of
equipment, materials, and labor, contractor or supplier delay, delays due to
judicial or regulatory action, nonperformance under construction, operating, or
other agreements, operational readiness, including specialized operator training
and required site safety programs, engineering or design problems or any
remediation related thereto, design and other licensing-based compliance
matters, challenges with start-up activities, including major equipment failure,
or system integration, and/or operational performance, and challenges related to
the COVID-19 pandemic; the ability to overcome or mitigate the current
challenges at Plant Vogtle Units 3 and 4, that could further impact the cost and
schedule for the project; legal proceedings and regulatory approvals and actions
related to construction projects, such as Plant Vogtle Units 3 and 4, including
Georgia Public Service Commission approvals and NRC actions; under certain
specified circumstances, a decision by holders of more than 10% of the ownership
interests of Plant Vogtle Units 3 and 4 not to proceed with construction and the
ability of certain other Vogtle owners to tender a portion of their ownership
interests to Georgia Power following certain construction cost increases,
including the purported exercises by Oglethorpe Power Corporation and the City
of Dalton of their tender options and related litigation; the ability to
construct facilities in accordance with the requirements of permits and licenses
(including satisfaction of NRC requirements), 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; the inherent risks involved in operating and constructing nuclear
generating facilities; the ability of counterparties of Georgia Power to make
payments as and when due and to perform as required; the direct or indirect
effect on Georgia Power's business resulting from cyber intrusion or physical
attack and the threat of physical attacks; catastrophic events such as fires,
earthquakes, explosions, floods, tornadoes, hurricanes and other storms,
droughts, pandemic health events, political unrest, wars or other similar
occurrences; and the direct or indirect effects on Georgia Power's business
resulting from incidents affecting the U.S. electric grid or operation of
generating or storage resources. Southern Company and Georgia Power expressly
disclaim any obligation to update any forward-looking information.
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