Nuke Financing Passes Committee, Goes to Full Senate|
Georgia Online News Service
A controversial rate hike for Georgia Power consumers will come before the Senate as early as Monday, and if the result of debate in a packed committee hearing is any indication, it may get Senate approval.
Senate Bill 31 would allow Georgia Power to tack a charge onto power bills to pay for the financing of construction costs for two new planned nuclear power plants near Augusta. The surcharges would begin in 2011, starting at $1.30 per household per month, then rising to $9.10 by 2017. But the plants will only start making electricity in 2016 at the earliest.
Currently, Georgia Power is allowed to recoup plant construction and finance costs from ratepayers only after the plants come online. Those rates are governed by the Public Service Commission, the elected body that sets consumer power rates. That way, only people who actually use the plant pay for it.
But because nuclear can help Georgia deliver cheaper power, a major enticement for manufacturing, Georgia Power deserves some leeway around the PSC's "hampering", says the bill's sponsor, Don Balfour (R-Snellville).
"We've got to figure out how to promote nuclear. And this is one way to do it," Balfour said in exasperation at the end of his testimony before the Senate Regulated Industries and Utilities Committee.
Balfour also denied that the bill is a sweetheart deal for industry, as a PSC analysis argues. He testified that rate hikes will hit all users in the same proportion that they always pay for Georgia Power construction costs, but stopped short of saying all customers pay out equally.
Capacity upgrade charges under this bill would be divvied up as usual, explained Georgia Power comptroller Ann Daiss, but admitted that the usual is not strictly equal. "This bill does not say industrial customers don't pay for this charge," she told the Senate committee. "What it does say is that for those customers that normally pay for capacity charges, which is almost all of our customers, they will pay."
Those partially exempt are the so-called "real time pricing customers", certain industrial and commercial users. Some 14% of Georgia Power's energy revenue would be exempt, according to a company statement. The PSC alleges the figure is 37.7%. Georgia Power has also applied for some low-interest financing from the Department of Energy, something Sen. Tommie Williams (R-Lyons) brought up. "I'm trying to determine what would be the best for the people who are going to pay … would it not be better for them if you could borrow all federal money?" Williams asked.
But Daiss said Georgia Power doesn't know when the federal department might decide on the financing, and besides the loan would not be earmarked for the plants.
In fact, as the senate mulls SB 31, the PSC is considering almost exactly the same proposal from Georgia Power. The utility is both approaching its regulator and its regulator's masters in the legislature.
The importance of certain financing is the motive, according to Georgia Power. If the General Assembly approves the bill, it would allow the rate hike for Georgia Power without going before the PSC.
The Senate committee ended by passing the bill in an 8-2 vote after the second round of hearings on Feb. 4. Only Williams and Sen. Doug Stoner (D-Smyrna) dissented, favoring a version of the bill that would have substantially returned the decision to the PSC.
The bill only affects Georgia Power ratepayers. The state's electric membership cooperatives and municipally owned utilities are unregulated and may start billing for their portion of costs on the two nuclear plants at any time.
The PSC has not yet formally approved even the construction of the two nuclear plants, though the approval is widely expected soon.
Maggie Lee specializes in quality of life topics, Atlanta's international communities and general reporting. She covers Georgia economic development and the Chinese community as a stringer for China Daily and chronicles life in Georgia's most diverse county for the DeKalb Champion. [full bio]