Special to SEGAZINE
The Obama administration finalized $6.5 billion worth of loan guarantees for the country’s first U.S. reactors in decades without requiring developers to pay a “credit subsidy fee” — money that protects taxpayers should the developers default, according to documents obtained by Greenwire.
The Energy Department zeroed out the fees in February when finalizing a first-of-its-kind $3.5 billion loan guarantee for a subsidiary of Southern Co. and an approximately $3 billion loan guarantee for Oglethorpe Power Corp. to build two reactors at the Alvin W. Vogtle nuclear plant, about 30 miles southwest of Augusta, Ga., according to two letters obtained through Freedom of Information Act requests.
DOE Loan Program Office Executive Director Peter Davidson sent a Feb. 11 letter to Earl Long, Southern subsidiary Georgia Power’s assistant treasurer, and a separate letter the same day to Betsy Higgins, Oglethorpe’s chief financial officer, which said the companies owed nothing in final credit subsidy fees tied to the execution of the Vogtle loan guarantees.
“The credit subsidy fee payable to DOE in connection with its execution of the loan guarantee agreement dated Feb. 20, 2014, between DOE and [Oglethorpe], pursuant to which DOE will guarantee a federal financing bank loan to OPC [for $3 billion, including estimated capitalized interest] is $0,” Davison wrote in one letter to Higgins.