Georgia nuclear plant begins splitting atoms for first time

Re:Georgia nuclear plant begins splitting atoms for first time by fnordpiglet on Tuesday March 07, 2023 @05:12PM (#35062004)

Utilities are generally paid for by the users regardless of their cost. Investors are typically insulated in so far as the project completes, which is completely normal. It’s not like there’s some sort of call provision on a bond that asks for more money from the bond holder if the project costs more. Typically you would simply issue more bonds. Instead of issuing bonds and paying interest on those out of utility bills, they decided to just pay up front (which was likely a bad deal given how low interest rates have been). But in the end the utility users pay everything in every situation. Where else would the money come from? The charity investors who give money to mega projects out of benevolence? There aren’t many of those. It generally comes out of a mixture of taxes and utility users. Even investors are just loaning capital and their primary risk is the project outright fails.

I feel like in reading these comments people feel like there’s some other third party that foots the bill

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Re:Georgia nuclear plant begins splitting atoms for first time by Gwypaas on Tuesday March 07, 2023 @05:19PM (#35062076)

Depends on if you have a regulated or open electricity market. You describe a regulated market.

On the other hand, Europe by and large operates on a marginal pricing open market with utilities providing the transmission grid and stabilization services.

In that market the investors take the losses. Unless huge state subsidies are brought out like Hinkley Point C leading to the government guaranteeing a strike price of $150/MWh over 35 years.

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Re:Georgia nuclear plant begins splitting atoms for first time by fnordpiglet on Tuesday March 07, 2023 @08:42PM (#35064082)

Realistically consumer still pay for the utility as the marginal pricing must provide revenues sufficient and in excess of capital and operating costs, and a sufficient risk premium to investors. If consumers don’t like it, they won’t get the services. There’s an argument that a market model is more efficient, but there’s an equally plausible argument that utility models provide more stable pricing - and that end users of utility services prefer stability over efficiency. Thanks for the info though I wasn’t aware Europe was structured this way, but it does explain why costs have been so volatile.

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Re:Georgia nuclear plant begins splitting atoms for first time by fsckboy on Sunday March 12, 2023 @10:54PM (#35130369)

> Depends on if you have a regulated or open electricity market. You describe a regulated market.

what's being described is a regulated natural monopoly, standard economics. No economist would recommend unregulated natural monopolies.

marginal pricing would not pay for a transmission grid, and utility investors would not agree to build or maintain a grid without it being paid for. Marginal pricing refers to the cost of electricity given the grid, where there is no extra amount covering the cost of extra grid capacity.

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