Audit: Bechtel Power Corp. overcharged TVA for labor at Watts Bar Nuclear Power Plant

Audit: Bechtel Power Corp. overcharged TVA for labor at Watts Bar Nuclear Power Plant

November 22nd, 2017 by Dave Flessner in Business Around the Region

Both cooling towers are in operation at Watts Bar Nuclear Plant on Wednesday, Oct. 19, 2016.

Photo by Tim Barber /Times Free Press.

The primary contractor for America's newest nuclear power plant overbilled the Tennessee Valley Authority by more than $6.8 million from 2010 to 2015, according to a new TVA audit.

Bechtel Power Corp., an engineering and construction firm that TVA paid $502 million over five years for craft labor to help finish the new Unit 2 reactor at the Watts Bar Nuclear Power Plant, overcharged TVA for overtime and meal expenses and used incorrect allowances for other workers' pay, the audit said.

In a report prepared by the TVA Office of Inspector General, Bechtel is accused of charging more than $3.8 million for ineligible overtime and meal allowances, $2.9 million for ineligible and excessive craft labor costs for material handling and $60,808 for an incorrect rate for the Helmets to Hardhats program that aids military veterans in construction projects.

Fred deSousa, manager of public affairs for Bechtel's nuclear, security and environmental division, said the company "respectfully disagrees" with the audit findings, which he said "do not accurately reflect the project's agreements concerning union labor.

"We have and will continue to provide the documentation to TVA that support our billing process which is in accordance with the terms and conditions of our contract and in compliance with applicable law," he said.

TVA spokesman Jim Hopson said TVA is still in negotiations with Bechtel over the proper payments for the work.

"TVA insists that our contractors and vendors have the same high level of accountability that we expect of our own employees," Hopson said. "So if these audit findings are proven to be valid, we will pursue the appropriate course of action to make sure this situation is rectified."

The Bechtel payments being questioned are for work that was done at least a year prior to the Unit 2 reactor at Watts Bar being declared a commercial nuclear plant last October after 43 years of on- and off-again construction of the unit in Spring City, Tenn.

The newest reactor at Watts Bar was completed a decade after the first unit was finished in 1996 at a cost of about $5 billion. Completing the second unit at Watts Bar took three years longer and nearly $2.5 billion more in costs than what TVA projected when it decided a decade ago to finish the then mothballed plant.

Contact Dave Flessner at or at 423-757-6340.