The CBS spot above isn’t really as nuanced as it needs to be, a kind of frames a “Data Centers cause price increases” story that isn’t exactly accurate.
But what it gets right is, setting the story in Georgia, pointing out that one of the big drivers in that state has been the startup of the Vogtle Nuclear plants, which have given that industry a massive black eye in terms of affordability.
They interviewed Patty Durand, who I just met thru her Op-Ed below.
In April 2024, Georgia Power completed the first new nuclear units in the United States in 30 years. But for Georgia Power customers, the project did not come with a celebration: It came with an almost 25% rate increase.
And Plant Vogtle came with its own “Let them eat cake” moment for Georgians: On May 31, 2024, U.S. Energy Secretary Jennifer Granholm joined federal and state officials at a ribbon-cutting ceremony on site in Waynesboro, Georgia. There, she called for building 200 more gigawatts of reactors without mentioning the Vogtle’s $36 billion price tag, while attendees enjoyed cake shaped like nuclear reactors.
Throughout construction, as cost overruns ran into the billions of dollars, these same regulators declined to put consumer protections in place, claiming that a thorough review to determine what costs were prudent and reasonable would take place at the end. Yet that review never happened. Georgia is one of only a handful of states with no consumer utility counsel or advocate to represent consumers in complex, billion-dollar rate cases. For Vogtle, that absence had profound consequences: as the project neared completion, PSC staff and Georgia Power reached an agreement under which cost overruns would be passed directly to customers, without a full record of hearings or prudency review. The result is little national understanding of the drivers of the cost overruns, allowing all kinds of beliefs about nuclear energy to take root without a factual record.
What does that have to do with the national push for nuclear energy underway now? There is a strong belief among proponents that the next time will be different, that a learning curve exists from Georgia’s experience. Claims that Unit 4 was cheaper to build, or that there was any meaningful learning curve, are not backed up by facts or documentation. If that were true reports documenting that amazing outcome would be public and news stories would proliferate, but neither exists.
In fact, nearly every major claim made leading up to and throughout the project was false. Georgia Power claimed for years that Plant Vogtle was on time and on budget when it wasn’t. South Carolina Electric & Gas and Westinghouse made false claims of progress on their twin nuclear project, using the same AP1000 reactor design as Georgia, leading to criminal charges and massive fines for both utility and Westinghouse executives when the truth was revealed.
The political fallout in Georgia has been significant, too. Last November, two Republican Public Service Commissioners were removed by voters in decisive elections, the first time in 20 years that Democrats were elected to the commission. The following month, a special election flipped a traditionally Republican-held seat to a Democrat who campaigned on Public Service Commission accountability. And last month, a third Georgia commissioner announced she would not seek reelection.
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But it’s not just about how we generate electricity. In fact, that’s become a smaller portion of most people’s bills in the last decade, overshadowed by the cost of transmitting those electrons on an aging and inadequate grid.
One way or another, we will pay the cost of an upgrade, either pro-actively, or because chronic failures will force it on us.
Rob Meyer’s piece in today’s New York Times is good primer.
Robinson Meyer in New York Times:
Lately Americans have become fixated on the explosion in data centers and the power needs of artificial intelligence. That is actually a small part of a much bigger problem. Our grid is too old and our supply of electricity too small. If we don’t meet this moment, we will face an impoverished future of more expensive, less reliable energy, and slower economic growth. In a worst-case scenario, we could see Americans defect from the grid entirely, raising costs for everyone. Something needs to change now.
The power grid does not work in the way that many people expect. For a long time, when I paid my power bill, I assumed that most of my payment went to generating the electricity I had just used. In fact, the cost of operating and maintaining the power grid itself — moving electricity over long distances, then delivering it to homes and businesses — makes up a growing share of bill costs.
These system costs can raise prices, which can then drive demand. This is why states that have seen electricity demand grow the most since the pandemic — such as North Dakota and New Mexico — have seen their electrical prices grow the least and sometimes even decline. Meanwhile, the states where demand dropped — such as California and Maine — saw their prices grow the most.
Natural disasters have driven the worst of these costs. After California’s power grid ignited several deadly fires in the last decade, the state undertook a costly process to lay underground lines, install weather stations and build automatic shut-off equipment to prevent future blazes. The South, meanwhile, has had to rebuild parts of its grid after extreme storms destroyed large swaths of it.
These disaster-exposed states had to rebuild the last-mile distribution system that delivers power to homes and businesses. That increased their system costs, which drove up the cost of electricity and pushed their residents to use less power overall.
But every state will have to rebuild swaths of its grid soon. Much of America’s distribution equipment is decades old and would be nearing the end of its life around now anyway. We will also need to upgrade and expand the transmission system, which sends electricity over long distances from power plants to towns and cities.
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Meyers piece is too long to excerpt here, but feel free to use the guest link to read, and bookmark if you can.