Double Electric Hike Takes Effect New Year's Day

From: AJC

Two simultaneous increases in the cost of electricity from Georgia Power take effect on New Year's Day.

A rate increase approved by utility regulators Dec. 21 and a nuclear fee mandated by the state Legislature in 2009 both hit bills for the first time in January.

The combined impact will push up the typical residential power bill -- defined as 1,000 kilowatt hours of power usage -- by nearly $14.50 per month or almost $175 a year.

The rate increase allows Georgia Power to recoup its investments in infrastructure, including transmission expansions and government-mandated environmental controls, and to earn a return on those investments of 11.15 percent.

The nuclear fee begins collecting the costs of two new reactors at Georgia Power's Vogtle nuclear plant. The company expects to bring the new reactors on line in 2016 and 2017.

State lawmakers mandated the fee in 2009 after a vigorous lobbying campaign by Georgia Power. Consumer groups opposed the fee.

The utility says the early collection will allow it to shave hundreds of millions of dollars from the cost of financing the $14 billion project.

The state's municipal power companies and most of its electric membership cooperatives are sharing in the Vogtle costs, although most are not charging customers yet.

Georgia Power customers will see further increases in 2012 and 2013 under a compromise deal approved two weeks ago by the state Public Service Commission.

The further increases will add about $4 more to the typical residential monthly bill.

By 2013, that typical bill will be $216 more per year than it is today.

Seriously, nuclear power plants? ...Come on, Georgia.

Electric Rate Hike Meets Late Resistance

From: AJC

A week from Tuesday, state utility regulators will decide on a three-year deal that would give Georgia Power one of its biggest rate hikes in history -- and eventually add another $15 to the typical family's monthly electric bill.

The deal was signed by Georgia Power, the Public Service Commission's litigating staff and many -- but not all -- of the interest groups involved in fighting the utility's original, $1.1 billion rate hike request. It would give the company an $844 million hike.

Now the holdouts are pushing back, in a last-ditch attempt to shave the rate increase further.

They filed their own three-year deal proposal at the state Public Service Commission last week, asking the commission to approve that version instead of the one agreed to by everybody else.

The holdouts include the consumer group Georgia Watch, AARP, The William Bonnell aluminum manufacturing company in Newnan and Resource Supply Management, which argues for lower commercial power rates.

The groups said their proposal is a compromise for all of them, and asks for a series of changes in the deal put forth by Georgia Power.

Those changes include cutting Georgia Power's rate hike to $435 million and its maximum allowed profits from 12.25 percent to 10.75 percent. The group also wants all excess profit returned to customers, instead of the two-thirds in the original deal.

"In this economy, ratepayers can not afford to pay inflated profit margins for necessities like electricity," Georgia Watch said in a brief.

The group also wants to nix a part of the deal that would allow the company to file for a new rate increase inside the three- year term if its profits fall below a certain level.

The alternative deal isn't likely to fly, since Georgia Power and PSC staff have signed another one.

The PSC can't impose binding multi-year rate plans on the company if the company doesn't agree.

It may create some fireworks, though, when the commission discusses the case for a final time next week.

The final vote is scheduled Dec. 21.

Yet another reason to look into alternative sources of energy and become energy independent.

We would love to help.

Confirmation Code: GHMXDBS7479205

GA Power Customers To See 10% Rate Hike

From AJC:

Georgia Power rates will go up $844 million over the next three years, according to a deal reached Friday.

Signed by the company, the litigating staff of the state Public Service Commission and a group of large retailers, the deal would push up the typical residential customer's bill by an average of $15 per month by 2013.

The bulk of that, or $10.86 per month, would take effect Jan. 1.

The five-member PSC still has to approve the settlement, and will vote on it Dec. 21.

With both the commission staff and an unusually united group of major retailers on board, the settlement deal is almost certain to pass.

“We feel this agreement will allow us to continue to provide reliable service while meeting environmental requirements and keeping rates below the national average," said company spokesman Jeff Wilson, in an e-mailed statement.

The company agreed to an 11.15 percent return on equity, which is less than both the 11.95 percent return it requested in July and the 11.25 percent return it earns now.

The deal does not include two utility-proposed changes in the way the company would raise its charges in the future.

Georgia Power had asked for a more automatic way of raising rates, which would have allowed it to adjust its charges up annually if it wasn't making its allowed returns. The proposal was part of what united retailers against the rate hike request.

The company also wanted the PSC to allow it to begin charging customers for new power plants and other investments without having a formal rate case.

Neither proposal made it into the settlement deal. But the staff and retailers did agree to a provision allowing Georgia Power to raise rates inside of the settlement's three-year life, if its returns fall too low.

Any such increase would be temporary and would expire in 2014.

A final round of hearings in the case will still go forward on Dec.1, three weeks before the commission's vote.

Several parties who had participated in the case aren't named on the settlement, including the Georgia Industrial Group, the consumer group Georgia Watch, and senior advocacy organization AARP.

None could be reached for comment after Georgia Power released the settlement news Friday evening.

In a statement, the company said business customers will see an increase of about 7 percent to 8.7 percent in their bills, while residential rates would rise 10 percent.

Georgia Power had originally asked for more than $1.1 billion in new revenue, along with the proposed overhaul of the rate-making process.

The company said it needed the money to recoup its investments in power transmission and distribution systems, a new natural gas power plant near Smyrna and for environmental controls required by state and federal law.

Georgia Power said it has invested almost $5 billion since its last rate request was approved three years ago.

The company's retail rates were about 7 percent below the Southeast average and 14 percent below the national average, according to the latest available numbers from the federal Energy Information Administration in December 2009.

Ga Power Cleared To DOUBLE Solar Purchase Program

Source: BrighterEnergy.org

One of the nation’s largest utilities has been given the green light to nearly double the amount of solar power it buys through its Green Energy Program.

Georgia Power, part of Southern Company, said yesterday that it has received approval from the Georgia Public Service Commission to offer a new tariff for small-scale solar power installations.

Available from January, the Solar Purchase Tariff will offer Georgia Power customers the chance to sell their power to the utility for 17 cents per kilowatt-hour.

The tariff is limited to installations of less than 100 kilowatts in output, and will cover 1.5 megawatts of projects overall.

A further condition of the tariff is for all those on it to provide Georgia Power with all cost and operational information, so the company can gain experience in solar electricity generation.

In a second part of the program, Georgia Power will issue a request for proposals for a further 1MW of solar capacity, offering a price of 15 cents per kilowatt-hour maximum. The RFP has no limit on project size up to the 1MW total.

Purchasing

The new solar generating capacity will be made available for Georgia Power’s customers to buy through its Premium Green Energy product, where 100-kilowatt-hour blocks are available at $5 per block, comprising 50% solar energy. The company’s Standard Green Energy, comprising biomass power, is priced at $3.50 per block.

The company, which serves 2.3 million customers across Georgia, said nearly 4,200 customers have purchased 3.8 million kilowatt-hours of green energy through the Green Energy program since it began in October 2006.

“Since we began offering customers a 50% solar option, we’ve added almost 1,000 new blocks of the Premium Green Energy product to the program,” said Angela Strickland, director of Energy Efficiency at Georgia Power.

“By increasing our solar capacity in the program to 5.4 MW, we hope to keep pace with the significant growth of solar purchases by our customers both now and in the future.”

GA Power Calls For ANOTHER Rate Hike

From AJC.com:

When state utility regulators take up Georgia Power’s request for a $1 billion-plus rate increase three weeks from now most attention will be on the proposal’s size.

But something more important to both the utility and its customers also is on the table.

The company wants to do here what its Southern Co. affiliates in Alabama and Mississippi have done for years: Put rate increases on a kind of autopilot.

It would mean electric bills could go up once or even twice a year from now on if the utility isn’t making its guaranteed profit margin. The company has asked for a margin of just under 12 percent.

It also would guarantee the company that profit for the first time.

The classic electric rate battle, with its months of testimony, rebuttal and arguing in public, largely would become a thing of the past. Instead, Georgia electric bills would slide up gradually, with about one-third of the scrutiny increases get now.

Bills also could go down more easily, but no one pretends that’s likely to happen anytime soon.

Georgia Power says it sees its proposal as a way of avoiding the kind of whopper rate hike request it filed this summer, by allowing smaller increases more often.

Electric utilities around the country have been proposing faster nontraditional ways of getting paid because their costs are going up, not down, said Ken Costello, a utility expert with the National Regulatory Research Institute. He was in town this week to brief Public Service Commission staff on the proposed process.

Georgia Power says the change would make rates more stable.

Critics say it would remove a major incentive for Georgia Power to control costs and would shift business risks to consumers.

"Consumer advocates hate these things," said John Coffman, an attorney representing AARP in the current rate case. "It's perfect for the utility. They shift the risk and still get their double-digit profit."

Jim Clarkson, a consultant for commercial energy users, agreed the proposal shifts risk but said Wall Street will love it.

"It's certainly a Southern Company modus operandi," he said. "They've been trying to get something like this for years, off and on."

He said Southern Co. regularly cites its automatic rate increases in Alabama and Mississippi when talking up its financial health to investors.

Roy Bowen, head of Georgia Traditional Manufacturers, said his members -- the state's large industrial power users -- haven't taken a position yet on the proposal.

One small power user, meanwhile, has made up her mind. "I don't understand why anyone would even think of approving that," said Merle Evans, a senior citizen from Doraville. "What kind of monopoly is this anyway?"

Under state law, Georgia Power can file a rate increase at any time. For years, though, the company has agreed to settlement deals that require it to wait three years before filing again.

The PSC sets an allowed profit band and the company is supposed to keep its profits within it.

For more than a decade, the company has had to split the spoils with customers if it exceeds its profits by too much. The company has rebated money to customers three times, in 1999, 2000 and 2005.

The new proposal would allow the company to also charge more if its profits drop too low, as they did when the economy bottomed out last year.

Georgia Power proposes making a rate filing every November, based on an estimate of what the next year's costs would do to its profit margin.

The PSC staff would have 60 days to get their arms around the company's numbers -- instead of the six months allowed now when Georgia Power asks to increase rates. The five-member commission itself would then approve the change and it would go into effect in January.

Three months later, the company would make a second filing, based on its actual costs for the previous year. If its costs were higher than expected, and its profit margin less than expected, the company could again raise rates after a truncated review by the PSC and its staff.

A similar program has worked well for years in Alabama, said John Free, a spokesman for that state's Public Service Commission. He said Alabama Power's rates compare well with the nation, despite the more automatic rate increases there. Bobby Waite of the Mississippi Public Service Commission also said Georgians shouldn't fear the more automatic rate-making process.

Both states' rates rank in about the middle nationally. Both are also higher than Georgia's, according to the most recent data available from the U.S. Department of Energy.

Costello, the national utility expert, said most states still use traditional rate cases, and that Georgia's PSC should look carefully at whether the proposed revision is needed.

He said regulators must have enough time to really look at a utility's numbers, "to avoid the risk that rate increases just get rubber-stamped."

The PSC will rule on the proposal in December, when it rules on Georgia Power's rate case. It's unclear where commissioners stand: They're not allowed to talk about it.