Georgia Power, PSC Staff Reach Agreement on Request for More Generating Capacity

Dave Williams

Thursday, March 28th, 2024

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Georgia Power and state energy regulators have agreed on a plan to increase the Atlanta-based utility’s electrical generating capacity including the construction of three new gas combustion turbines at Plant Yates near Newnan.

The revenue that new capacity would produce for the company would more than offset the costs to generate the additional power, Aaron Abramovitz, Georgia Power’s chief financial officer and treasurer, told members of the state Public Service Commission (PSC) Wednesday. The resulting savings would save the average residential customer $2.89 a month from 2026 through 2028, he said.

“At Georgia Power, our customers are at the center of everything we do, and we are unwavering in our commitment to provide them with clean, safe, reliable, and affordable energy,” Abramovitz testified.

“The stipulated agreement benefits all customers, and approval of this agreement will preserve and protect the reliability and quality of electric service our customers expect and support the continued economic development of our state … all while placing downward pressure on rates for all customers.”

Georgia Power submitted a request to the PSC last October for additional capacity to handle a growing demand for electricity.

Abramovitz said Wednesday the company has received commitments for an additional 2,600 megawatts of power from 11 large-load customers. A megawatt is enough electricity to power about 750 homes. The Georgia Association of Manufacturers is a party to the agreement, along with Georgia Power and the PSC’s Public Interest Advocacy Staff.

“This clearly indicates that these customers are coming, that significant load will materialize, and that the need to serve that load will occur sooner rather than later,” Abramovitz testified.

Besides the new gas turbines, Georgia Power’s plan to add generating capacity also includes power purchasing agreements with Mississippi Power – a sister company of Georgia Power – and Florida-based Santa Rosa Energy Center LLC, all involving natural gas.

Georgia Power also is proposing an expansion of its battery energy storage capacity and new and expanded distributed energy resources, such as rooftop solar, and demand response initiatives in which customers voluntarily agree to reduce energy use during periods of peak demand.

While the utility requested to develop, own, and operate 1,000 megawatts of battery energy storage, the agreement reduced that amount to 500 megawatts, including projects at Robins Air Force Base near Warner Robins and Moody Air Force Base near Valdosta.

Georgia Power agreed to issue a request for proposals on an expedited schedule to obtain the other 500 megawatts of battery energy storage.

The proposed agreement got pushback Wednesday from the Atlanta-based Southern Environmental Law Center (SELC).

“This is a fossil fuel bonanza,” said Jennifer Whitfield, a senior attorney with the group. “Not only is expanding dirty and unpredictably priced fossil fuels on the table. This agreement would allow Georgia Power to bypass important steps to protect its customers from rising energy bills.”

The SELC disputed Georgia Power’s assertion that the agreement will reduce customer bills, citing its own analysis predicting bills would go up by $44 per month during a two-year period when combined with a series of other rate hikes. The group also maintained the additional demand for energy could be met with renewable options including solar power and battery storage.

The commission is scheduled to vote on the agreement on April 16.