Judge upholds Vogtle PPA between MEAG Power and JEA

A power purchase agreement between Florida public power utility JEA and the Municipal Electric Authority of Georgia (MEAG Power) tied to the expansion project at Plant Vogtle, a nuclear power generating facility in Georgia, is valid and enforceable, U.S. District Judge Mark Cohen ruled on June 17.

Under the terms of the PPA, which was signed in 2008, and amended and restated in 2014, JEA committed to purchase all of the energy generated by the new units 3 and 4 of the Vogtle plant, as part of “Project J,” during their first 20 years of operation, as well as to pay for approximately 41 percent of MEAG Power’s share of the construction cost for the new units during those 20 years.

Plant Vogtle Units 3 & 4 consist of two 1,100-megawatt Westinghouse AP1000 nuclear reactors being constructed in Burke County, Ga. MEAG Power’s co-owners in the Vogtle expansion project are Georgia Power (45.7 percent), Oglethorpe Power (30.0 percent) and Dalton Utilities (1.6 percent).

The June 17 ruling “confirms the merits of MEAG Power’s position on this matter while avoiding a prolonged and costly trial,” MEAG Power said in a news release.

“This afternoon, JEA received the Court’s Order granting MEAG’s motion for judgment on the pleadings and finding the Plant Vogtle PPA to be a valid contract,” JEA said in a statement.

“Importantly, however, the Court instructed the commencement of discovery on JEA’s counter claims," JEA said. These claims seek to recover damages "resulting from MEAG’s failure to exercise reasonable care when it voted to continue construction of the project,” JEA added.

JEA said it will “pursue these claims going forward. As to the ruling on the contract’s validity, the City and JEA will review the ruling and evaluate its options.”

JEA and the City of Jacksonville, Fla., in 2018 filed a complaint in Florida state court for declaratory judgment regarding the PPA. The complaint was filed in the Fourth Judicial Circuit Court of Florida on the same day that MEAG Power filed a breach of contract lawsuit against JEA.

MEAG Power provides wholesale electricity to 49 member communities in Georgia, who own their local distribution systems. JEA, which is located in Jacksonville, Fla., serves an estimated 478,000 electric, 357,000 water, 279,000 sewer customers and 15,000 reclaimed water customers.