ATLANTA – Legislation allowing Georgia Power to finance the Plant Vogtle nuclear expansion and other large projects through bonds cleared a state Senate committee Monday over the objections of the chairman of the Georgia Public Service Commission (PSC).
Senate Bill 421 would authorize Georgia Power to pursue securitized bond financing to recover some of the costs of the Vogtle project as well as what the Atlanta-based utility is spending to retire its fleet of coal-burning power plants and clean up the ash ponds surrounding those plants.
Twenty-six states have passed similar legislation, including nine that use bonds to finance non-emergencies such as coal-plant retirements, Sen. Chuck Hufstetler, R-Rome, told members of the Senate Regulated Industries & Utilities Committee Monday.
Using securitized bonds saved electric customers in Michigan $135 million and those in West Virginia $130 million, Hufstetler said.
The Georgia bill includes a provision prohibiting the PSC from approving bond financing if it wouldn’t provide “quantifiable and verifiable” savings to customers, he said.
Going with securitized bonds would be voluntary on Georgia Power’s part, Hufstetler said.
“If you don’t need it, don’t use it,” he said. “The goal is to save the ratepayers money … by getting lower financing costs.”
The commission hasn’t taken a formal position on the bill.
But PSC Chairman Tricia Pridemore told committee members practical considerations would make it impossible for the commission to use securitized bond financing. For one thing, the PSC staff lacks expertise in securitization, she said.
Pridemore said securitization has been used to force some states to adopt a “renewable portfolio standard” requiring that a certain percentage of electricity come from renewable sources.
Although the Georgia PSC has never imposed such a mandate, the Peach State is expected to rank fourth in the nation in solar energy by 2024, up from ninth today, she said
“Our market-based approach has helped the costs come down,” she said.
Energy lawyer Bobby Baker. a former member of the PSC, said the bill also would rob the commission of flexibility to make adjustments as conditions change.
“It’s a one-and-done,” Baker said. “Once the commission approves bond financing, that’s it.”
Baker also called the bill unnecessary because Georgia Power is due to recover the costs of both the Plant Vogtle expansion and coal ash cleanup from customers.
Hufstetler’s bill also drew opposition from a Georgia Power executive at a committee hearing two weeks ago.
The legislation now moves to the Senate Rules Committee to schedule a floor vote.
This story is available through a news partnership with Capitol Beat News Service, a project of the Georgia Press Educational Foundation.