Key vote for Georgia Power
The Georgia Public Service Commission is scheduled to vote Thursday on Georgia Power’s long-term energy plan. The plan, which outlines how the utility will get and produce electricity over the next 20 years, includes a proposal to shut down 15 coal and oil-burning units. It does not include building any new power plants. At issue is whether regulators will mandate Georgia Power to boost its solar output.
If Georgia Power says it needs something, it usually gets it. Over the years, state regulators have cleared the way for the utility to land new power plants, more transmission lines and rate increases, often without much heated debate.
That could change Thursday, when the all-Republican Georgia Public Service Commission, an agency historically opposed to mandating renewable energy use, is likely to order the utility to amp up its solar electricity output, ignoring warnings from the company that it already generates more than enough power.
The increase in solar power that Commissioner Lauren “Bubba” McDonald is calling for isn’t eye-popping, but the ramifications could impact the power bills of millions of residents — whether it’s in savings or increases remains uncertain.
The push to add 525 megawatts is almost revolutionary for an agency whose commissioners once scoffed at the idea of Georgia getting electricity from renewable fuels. It also is significant because the powerful utility, with an army of attorneys and legions of lobbyists, has held remarkable sway over the commission for decades and is rarely forced to make such sweeping concessions.
Indeed, some observers say the solar debate is among the most heated issues before the commission in the past 30 years.
Federal environmental rules to clean up the nation's air and combat global warming have pushed coal-burning plants out of favor. Yet Georgia and the Southeast lag behind the rest of the United States in using renewable energy, in part because lawmakers and utility commissions in other regions have required the use of solar, wind and biomass.
The PSC and Georgia Power have warmed up to the idea of using more solar because the costs have fallen sharply, nearly 50 percent since 2010 according to a national solar industry trade group. The question for Thursday is whether adding more solar would drive up customer bills, which opponents say is a nonstarter.
Georgia Power seems unsure on that count. At a meeting Wednesday, the utility said adding at least 425 megawatts of solar could either cost or save the company and its ratepayers about $9.3 million. The final tally largely depends on the volatility of the price of other fuels, such as natural gas, and how much it pays solar providers to produce that sunpower instead.
“It just depends upon how those prices came in,” said Kyle Leach, Georgia Power’s resource and policy planning director.
Solar expansion supporters sound confident they have “yes” votes from at least three of the panel’s five members, but there’s a chance the vote could get scuttled or a watered-down compromise could be struck. And Gov. Nathan Deal is cautioning commissioners not to “do something simply because it sounds good without understanding all the ramifications.”
“I think we have to be careful. Am I in favor of green energy? Absolutely. But there comes a tradeoff, and that tradeoff is reliability and cost,” Deal said, adding: “I have great difficulty mandating what an energy portfolio must look like.”
The amount of solar at stake is relatively minor when compared with the two large nuclear reactors the company is building in Waynesboro. But it goes beyond symbolism by roughly doubling the amount of solar Georgia Power has agreed to buy from solar farms and rooftop arrays by 2017. In all, it would account for 2 percent of the utility’s total energy output.
It’s not hard to see why Georgia Power would want to block the vote. Aside from the argument that too much cloud cover makes solar panels less efficient, analysts say the spread of rooftop solar could threaten the heart of the utility’s market by reducing demand for its energy.
Thursday’s vote comes at a time when the utility is preparing for two other high-stakes battles over additional costs for its nuclear expansion project and a proposed 6 percent rate hike to pay for new equipment. Meanwhile, its facing new pressure from solar startups agitating to compete with the company.
Georgia Power isn’t used to competition. As a regulated monopoly, the utility makes its money from building large power plants to provide electricity to all customers in its territory. The company is allowed to recover those capital expenses plus earn a profit.
It’s also not used to losing major fights. The utility typically comes to the commission armed with veteran attorneys who craft air-tight arguments why regulators should approve its requests or shoot down proposals from environmental and consumer groups. Rarely is the outcome of a vote so in doubt.
The effort’s leading opponent is Commissioner Stan Wise, who says Georgia Power already generates more than enough electricity to meet its needs and forcing more solar could push rates higher. Americans for Prosperity and the Georgia Tea Party also have rallied their members against the move.
“It has great potential for upward pressure on rates, it is a mandate, it’s a square peg in a round hole again,” Wise said.
Solar companies, some environmental groups and rival tea party factions, such as the Tea Party Patriots, are on the opposite side of the debate. They see McDonald’s proposal as a way to diversify the state’s power supply and embrace cleaner energy alternatives.
“It’s hard not to be involved in an issue like this,” said Jeanne Thompson of the Tea Party Patriots. “We’re facing so much as Americans, and we’ve held strong to the fact that we need to look into as many types of energy sources as humanly possible.”
The outcome of Thursday's vote could have a lasting impact on Georgia's nascent solar industry, giving startup companies such as Georgia Solar Utilities a new foothold. The company has already installed 4,000 solar panels at Dublin High School, and it's hungry to expand.
“This vote has been a long time coming. If Georgia Power moved in the best interest of ratepayers and expanded solar, it would be difficult to compete with them,” said Robert Green, the president of Georgia Solar Utilities. “But they’re not using the monopoly they were supposed to.”
Shut out from the decision-making process, some Democrats see a potential campaign issue in next year’s election if the commission backs away from demanding alternative energy changes. State Sen. Jason Carter, D-Atlanta, said his party’s leaders are closely watching the debate.
“We have to start taking steps toward sustainable energy. There’s no other option,” said Carter, often mentioned as a potential statewide candidate. “The folks that are granted these monopolies should be willing and able to make it work, and I’m sure Georgia Power is able to make it happen.”
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