Nuclear proposal exempts big business from higher bills

A Senate bill that would allow Georgia Power to charge customers a special nuclear power fee largely exempts some of the state’s biggest businesses.

That could leave residents and smaller businesses shouldering most of the $1.6 billion interest cost of a planned nuclear expansion for Georgia Power.

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It also likely defangs the bill’s most potent opposition at the Legislature.

The lobby for the state’s biggest industry had vowed to fight Georgia Power’s bid to charge customers early for financing for two planned nuclear reactors near Augusta.

Representatives of the state’s big industry testified to the state Public Service Commission two days ago that the early collection plan would cost consumers hundreds of millions of dollars long-term.

The PSC typically allows utilities to collect on new plant construction only after the plant is up and running.

Georgia Power wants to begin charging for its financing costs in 2011, when it begins construction, instead of after the plants are complete in 2016 and 2017.

Georgia Power and the bill’s sponsor, Sen. Don Balfour (R-Snellville), say the early collection would hold down project costs by ensuring that customers don’t pay interest on interest.

They say the early collection protects Georgia Power’s credit rating, making its borrowing cheaper and allowing it to pass on savings.

Balfour’s Senate Bill 31 is titled the Georgia Nuclear Energy Financing Act.

If passed, it would take the issue of when Georgia Power can charge for nuclear plants out of the hands of the PSC.

The PSC is due to decide that issue in March and held a second round of hearings this week.

The bill already has 23 co-sponsors in the Senate. Balfour said he could probably get 30 to 35 senators to vote for it, assuring passage.

The language in the bill that gives a break to big customers specifies that the new fee will be allocated based only on a small fraction of those customers’ power usage.

The bill says the new fee will be allocated based on usage under rate plans designed to recoup “embedded capital costs.”

Some of the state’s biggest industrial and commercial customers, including grocery stores, department stores, home improvement stores and big factories and mills, pay for most of their power under a tariff that doesn’t meet that definition.

Balfour said his bill does not exempt big industry.

Normally, the decision of who would pay how much of a utility’s capital project costs would be decided by the PSC.

But Balfour said his bill would not change the customary mix of who pays what portion of a utility project.

“It’s a simple and straightforward bill,” he said.