Consumers Council of Missouri

Ga. Power bill introduced Friday
by Tom Crawford

Sen. Don Balfour (R-Snellville) confirmed that he will introduce on Friday a bill that would allow Georgia Power Co. to start charging ratepayers six years in advance for the construction of two nuclear generation units at Plant Vogtle.

The Balfour bill is expected to be one of the most controversial measures debated this session, with environmentalists and consumer groups dead set against the “construction work in progress” (CWIP) proposal put forth by Georgia Power executives.

The $14.4 billion nuclear project would not result in electricity generation until 2016 or 2017. Georgia Power is asking the Public Service Commission for permission to start charging ratepayers for $1.6 billion in construction financing costs starting in 2011, at least six years before the reactors would be finished.

Balfour’s bill would authorize Georgia Power to charge the CWIP rate regardless of what the PSC decides to do on the company’s request.

Georgia Power contends that charging ratepayers for the nuclear units before they go into operation would eventually save ratepayers $300 million. Critics of the plan say the utility is trying to shift all the risk for the project from shareholders to ratepayers who may never benefit from six years of higher monthly power bills.

“If Kroger raised grocery prices because they wanted to build a new store, you can just go to Publix,” said environmental lobbyist Neill Herring. “Where else can Georgia Power customers buy power?”

“This is an abuse of power because Georgia Power can cut off your power unless you pay for something you are not even getting, may never get, don’t need, and for which Georgia Power cannot even tell you the ultimate cost,” Herring added. “Only arrogance can explain their seeking this kind of rate increase when everyone is hit so hard by this economy.”

Balfour contended that ratepayers, in the end, are going to bear the costs of the nuclear plants anyway, regardless of how early their rates are increased.

“The EMCs and MEAGs already can charge off this interest and principle – the only company that can’t is Georgia Power,” Balfour said. “The ratepayer is going to pay the cost of that plant.”

“Contrary to the assertion that recovery of financing costs during construction lowers risks to investors, it actually helps maintain quality credit ratings, thereby lowering interest payments to investors and keeping costs lower for customers,” said Ann Daiss, Georgia Power’s chief accounting officer.

The nuclear payment legislation is already causing nervousness among some legislators who don’t want to be blamed for sudden increases in their constituents’ monthly power bills.

“Why are legislators, who go before the voters every two years, being asked to vote for this when the PSC can take care of it?” asked a state senator.

© 2009 by Capitolimpact. com