Utility rate increase?
The proposal: Georgia Power wants to charge its customers early for interest charges on the construction of two nuclear reactors near Augusta.
What it means: The average monthly electric bill would rise by $1.30 a month beginning in 2011, gradually rising to an estimated $9.10 monthly increase by 2017.
What’s next: A vote on the bill by the full House committee is likely to happen Wednesday. PSC must still sign off on building the reactors, which could take place in March.
A bill that would open the way for Georgia Power to boost electric rates in 2011 cleared its first hurdle Friday in the state House.
The House Regulatory and Utility Affairs Subcommittee approved the measure by voice vote.
The legislation would give Georgia Power permission to begin charging ratepayers early for interest charges to construct two new nuclear reactors at Plant Vogtle near Augusta. Under the bill, Georgia Power would be able to collect the charges years before the project’s estimated completion date of 2017.
The average monthly electric bill would rise by $1.30 a month beginning in 2011. That would gradually rise to an estimated $9.10 monthly increase by 2017.
State Rep. Amos Amerson, R-Dahlonega, who sits on the House Energy, Utilities and Telecommunications Committee, said he is leaning in favor of the bill.
“In the long run, the customers will pay less,” Amerson said. “They will be paying on the interest. It will lower the rate increase that will come after these reactors are completed.”
But a representative of AARP Georgia said Friday in Gainesville that the organization vigorously opposes the bill in Atlanta. Will Phillips, associate state director for advocacy, said the bill usurps the authority of the Georgia Public Service Commission.
“This whole thing sidesteps the regulatory process that has been set up to determine these things,” Phillips said. “The approach itself shifts most, if not all, of the risk on the backs of ratepayers. Every Georgia Power customer becomes an involuntary investor at a time when all of us have better things we can do with our money.”
Amerson said he has not heard from the PSC but has been told that Gov. Sonny Perdue supports the bill.
Critics also maintain that the estimates are conservative and the price could rise further, particularly if construction costs run over budget or the timetable for completion is delayed.
Supporters of the measure say it will save consumers money in the long run. Financing the interest costs up front will shave about $300 million off the project’s estimated $14 billion price tag.
Without the bill, Georgia Power argues that electric bills will shoot up 6 percent in 2016 and another 6 percent in 2017.
“This saves your consumers money because they are going to pay one way or the other,” state Sen. Don Balfour, the bill’s sponsor, told House lawmakers Friday.
The Snellville Republican and other backers have cast the bill as a critical economic development tool that would create jobs and lure companies to the state on the promise of affordable electricity.
State Rep. Randall Mangham, a Decatur Democrat, cast the lone dissenting vote. State Rep. Earnest “Coach” Williams, a Democrat from Avondale Estates, abstained until the PSC weighs in on the matter.
The bill now moves to the full committee. Amerson said the panel will be briefed on the bill Monday and a vote is likely on Wednesday.
If, as expected, the bill is approved by the committee, Phillips said his organization is ready to ask its 1.1 million members to call their state representatives and ask them to vote it down.
Separately, the PSC must still sign off on the utility’s plan to build the reactors. That vote is expected to take place in March.
The Associated Press contributed to this report.