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Health & Fitness

Power To The People

This coming Thursday, July 11th, the Georgia Public Service Commission (PSC) will vote on the pending Integrated Resource Plan (known as the IRP) that is currently before them.  An IRP is a plan presented by Georgia Power (the state's only investor owned electric utility) that proposes a 20 year plan for how they will acquire and generate the electricity they sell to their customers.  It is reviewed every three years and has to be approved by the PSC, as Georgia Power is a regulated monopoly.

I've been listening to the hearings online and keeping tabs on the various opinions being espoused by a variety of groups and have been encouraged to write a few words of my own.  I like to consider myself a neutral party in these matters as I'm neither a customer nor stockholder of Georgia Power nor any other energy related company.  I'm a Greystone EMC customer / member and enjoy reasonable electric rates and reliable service.

But right now in Georgia, there is an on-going argument over whether our state should adopt more solar as part of our energy mix and if so, how to go about it.  One of the problems we see with this technology here has little to do with the solar technology itself and much to do with the bad name that Solyndra and a number of other solar companies have given the technology.  That leads me to question why those same people don't hold the entire auto industry accountable for the actions of GM and Chrysler in regards to the government dollars they received?

As a free market fiscal conservative, I personally support eliminating all subsidies for all types of energy production.  Let them all stand on their own merits and let the best technology win.  If the winner is coal or nuclear or solar or wind or hydro, then so be it.  But each of those technologies (and others I haven't mentioned) have their own set of issues.  Coal fired plants have to install expensive scrubbers to capture emissions (along with possible supply chain disruptions and water supply issues), the sun doesn't shine 24 hours a day, the wind doesn't blow 24 hours a day, and we have yet to resolve how we're going to store the spent fuel from the nuclear reactors long term to name just some of the issues.

So when we consider the current IRP being presented by Georgia Power in front of the Public Service Commission we have to consider a number of factors: current electrical demand, future electrical demand (including possible changes due to either growth or decline of population / industry or decline in demand due to efficiency gains), and the costs and reliability of the various types of power production available to name a few.  So how do we balance the need for cheap, reliable, and clean electricity with these and other factors?  Most experts would say that a proper mix of various technologies is a smart way to ensure that the lights will continue to come on when you flip the switch and that your air conditioner will still be able to function on 98 degree summer afternoons when your roof is measuring temperatures well over 150 degrees.

According to the IRP, Georgia Power currently owns 149 generating units that provide approximately 17,400 megawatts (MW) of retail peak season generating capacity.  They are seeking to decommission a number of coal and oil fired power plants which make up just under 2,100 MW.  In the first 11 months of 2012, 42% of the electricity sold to customers was from coal, 18 percent nuclear, 4 percent hydroelectric, and 36 percent from natural gas and oil.  If my math skills serve me correctly, that means that zero percent (or at least a number that rounds down to zero) is from wind, solar, biomass, or any other form of generation.  However, they have filed a plan, called the Georgia Power Advanced Solar Initiative (GPASI or ASI), to purchase up to 210 MW of solar by the end of 2014.  So let's run some quick numbers.

Assuming that our 17,400 number stays approximately the same by the time we take into account efficiency gains and the decommissioning of the coal and oil fired plants, as well as the new reactors at Plant Vogtle and the other Power Purchase Agreements, we would effectively see that 210 divided by 17,400 means Georgia Power is essentially asking for a cap of roughly 1.2 percent of their electrical generation coming from solar.  Now, remember - this is a 20 year plan.  Also remember that whole "proper mix" of different technologies I talked about above?  Is one percent a reasonable slice of the overall pie?

Now, there's one group out there who has said that if the Commissioners require Georgia Power to add additional solar generating capacity over and above their proposed 210 MW (or purchase it from customer generators or other third party generators) that it effectively means Georgia then has what is known as a "Renewable Portfolio Standard (RPS)" and that our rates could go up as much as 40 percent in the next few years.  The NREL (National Renewable Energy Laboratory) I believe defines RPS as a regulation that requires the increased production of energy from renewable energy sources.  So technically they're right on the point of the RPS if the Commission asks for another 500 MW of solar generating capacity.  But where they're wrong is where they're saying that adding another 2 to 3 percent to our generating capacity coming from solar could raise rates by 40 percent.  I don't think you have to be a math scholar to figure out the accuracy of those numbers.

The cost of solar has come down dramatically in the past few years due to a variety of factors, including great advancements in the solar technologies and production field.  I've asked this question publicly before and I'll ask it again here for those that are "opposed to solar".  If a company approaches the Commission and Georgia Power and says that 1 - they want to sell to Georgia Power electricity generated by means of solar at rates that are equivalent to other sources from which Georgia Power purchases electricity - and 2 - are willing to contractually guarantee to maintain those rates for the next 20 to 30 years (even though the cost to produce other sources of electricity are most likely going to increase according to the forecasts I've seen), why should we turn them away?  Nobody that I've seen is proposing that we immediately close down all of our other power plants and strictly rely on solar - that's not a good idea either.

But it is completely reasonable to ensure that a government granted monopoly operates within parameters that ensures its customers receive reliable electricity at the lowest rates possible while having the least impact on the environment and our natural resources.  Until the Georgia General Assembly decides to modify the set of rules created by the Territorial Electric Service Act of 1973, it is the Public Service Commission's job to protect Georgia's ratepayers and taxpayers by regulating Georgia Power in whatever fashion necessary.

I'll just leave you with some food for thought here.  Had the Georgia General Assembly enacted legislation that would have allowed third party power purchase agreements (which currently violate the aforementioned Territorial Electric Service Act), it is possible that none of this would have been an issue.  Solar wants to expand here, but government regulations are currently preventing it from doing so.  Let's open up the market to competition and give them a chance - without putting ratepayer or taxpayer dollars at risk as is currently being done with the Plant Vogtle construction.  But that's another topic for another day.

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