Three criteria that must be satisfied before I will vote for additional solar power: First, no new monopoly service provider is created; second, no upward pressure on rates is exerted; and third, nothing violates the Territorial Services Act, which divides responsibility for serving electric customers among providers.
This is why I joined Commissioners Chuck Eaton and Stan Wise (of east Cobb) in supporting two amendments to ensure that Georgia’s consumer ratepayers and businesses are protected from upward pressure on electric rates.
The first requires an independent monitor oversee procurement of solar power under the program to ensure that ratepayers are protected. The second requires that any solar added under the new program be approved by the PSC and does not put upward pressure on electric rates. These two amendments ensure that no extra costs will be imposed on Georgia’s families as a result of this program.
Upward pressure is a term used to recognize that many factors ultimately affect rates, and no single factor causes rates to go up or down.
Today, the greatest cause of upward pressure on electric rates is the Obama Administration’s EPA, with its war on coal and unpredictable environmental standards which exert an unprecedented upward pressure on energy costs. Solar power, deployed conservatively, and with procedures in place to contain costs, can hedge against the financial risk caused by federal regulation.
The decisions we make on how power is generated will affect our economy, jobs and pocketbooks for a generation. By expanding natural gas production, we have enhanced the reliability of our system, and taken advantage of historically low natural gas prices.
The next major decision we make will be Georgia Power’s rate case in which the company seeks to recover additional costs from the construction of two new nuclear reactors at Plant Vogtle.
PSC decisions are not made simply because we side with consumers or the power company. Our decisions must meet specific standards under state law.
When a utility buys fuel to produce power, unless it spends money foolishly, it is entitled by law to reimbursement. Our decision is limited to whether the decision-making was so poor as to have been “imprudent.”
If we wrongly deny a utility company recovery of fuel costs, we would not only be cheating them with artificially lower rates, which will eventually have to be paid, we would also be liable to being overturned in a lawsuit.
Many of the factors determining whether Georgia Power can recover more expenses for Plant Vogtle must be decided through a quasi-judicial process in which the standard of review was whether an expense was incurred prudently. As a matter of law, we cannot substitute our own decisions made with the benefit of hindsight for those made by the company. Nor are we allowed to decide on the basis of whether we like or dislike the parties before us, or whether we approve or disapprove of nuclear power in general. Our decisions must be supported by facts and evidence presented during formal hearings.
The inexpensive and reliable electricity that Georgians demand requires financially healthy private sector utility providers. Without a healthy balance sheet and acceptable profit margin, utilities will pay far more in financing costs and pass that along to Georgia families and businesses. Short-sighted decisions made for political gain will eventually cost Georgians more money.
Our challenge on the Public Service Commission is providing oversight that balances low rates today and in the future. A recent Politifact article finding that Georgia ratepayers have paid electric rates 10 to 15 percent lower than the national average in eight of the last nine years indicates that the Georgia Public Service Commission’s oversight benefits families and businesses.
Doug Everett is a Commissioner on the Georgia Public Service Commission.