Commission Approves Rate Hike on Georgia Power Customers
Today the Georgia Public Service Commission (PSC) voted to approve Georgia Power’s proposed $870 million rate increase on its 2.1 million customers statewide. The PSC responded to public outcry against Georgia Power’s proposed solar tax, but Georgians will still be paying in advance for costly upgrades to aging, increasingly obsolete coal-fired power plants.
Sierra Club and GreenLaw Respond
December 17, 2013
FOR IMMEDIATE RELEASE
ATLANTA – Today the Georgia Public Service Commission (PSC) voted to approve Georgia Power’s proposed $870 million rate increase on its 2.1 million customers statewide. The PSC responded to public outcry against Georgia Power’s proposed solar tax, but Georgians will still be paying in advance for costly upgrades to aging, increasingly obsolete coal-fired power plants.
Based on today’s action, residential customers could pay up to $100 more per year by 2016, when the full rate hike takes effect.
“We are thankful that members of the PSC attended public meetings and carefully considered comments from citizens and organizations concerned about this rate increase,” said Seth Gunning, organizer with the Sierra Club’s Beyond Coal campaign. “But at the end of the day, customers will see another increase on their monthly bills to pay for expensive, obsolete coal plants while cheaper, cleaner options are on the table.”
Under the proposal the Commission approved today, Georgia Power is able to charge customers up to one year in advance for equipment upgrades at its coal plants, and base the charges on projections rather than real costs. Testimony showed that Georgia Power has a history of over-budgeting and under spending on projects, leaving customers with higher bills and no opportunity for refunds.
The Sierra Club asked the Commission to take steps to limit Georgia Power’s ability to charge customers in advance and strengthen cost review procedures to protect Georgians against unfair charges; the request was disregarded by the PSC.
“We are thankful that the PSC recognized that Georgia Power’s solar analysis was flawed and would hurt Georgia families,” said Ashten Bailey an attorney for GreenLaw, a nonprofit law firm that is representing the Sierra Club. “However, it’s unfortunate that the Commission voted to approve this rate hike to keep aging and dirty coal plants running past their expiration date, especially when there are opportunities for cheap and clean wind energy pending before them.”
Georgia Power had initially requested $1.46 billion in rate increases; a major portion of this larger increase was raising the utility company’s guaranteed rate of return, known as return on equity, to 11.5 percent from 10.95 percent. Grassroots activists and advocates argued against this additional punitive rate increase, and under the agreement approved today, Georgia Power was granted the lower rate of return. This is less than the 11.15 percent Georgia Power received as a result of the last rate case in 2010.
Georgia Power proposed its new customer rate plan earlier in 2013, originally including a new tax on property owners who install solar panels on their homes or businesses starting in 2014. After a groundswell of public opposition and strong testimony from solar and consumer advocates, Georgia Power removed the proposed solar tax from its new plan and modified its plans to pre-charge customers for coal plant upgrades.
The Sierra Club partnered with consumer advocacy group Georgia Watch to hold four public meetings in Savannah, Columbus, Gainesville and Athens, where more than 200 Georgia Power customers and community members voiced their opposition to the proposed solar tax and pre-charges for unnecessary coal plant upgrades.
Nationwide, leading utilities are phasing out their coal-fired power plants and replacing them with cleaner, more affordable power sources like wind and solar. Since 2010, 158 coal-fired plants have been set on a path to retirement, and 182 new plant proposals have been canceled.
GreenLaw is dedicated to preventing air and water pollution that endangers human health and degrades Georgia’s natural resources. Since 1992, GreenLaw has achieved these goals by providing free, high-quality legal and technical assistance to environmental organizations and community groups throughout Georgia. For more information, visit www.greenlaw.org and follow @greenlaw_GA on Twitter.
The Sierra Club is America's largest and most influential grassroots environmental organization. Inspired by nature, we are 2.1 million of your friends and neighbors, working together to protect our communities and the planet. Read more at http://www.sierraclub.org.