Merger Plan Guarantees Georgia Power’s Electric Base Rates Through 2019
Georgia Power – an investor-owned, utility that serves 2.4 million Peach State customers – announced on April 14 that its base electric rates will remain flat through 2019.
This three-year rate assurance is in addition to a net reduction of approximately $2.50 in the overall monthly bill for the typical residential customer, primarily driven by a 14 percent decrease in the fuel rate. This reduction was effective January 1.
The announcement follows a vote by the five members of the Georgia Public Service Commission (PSC) on an agreement connected to the pending merger of Southern Company (the parent company of Georgia Power) and Atlanta Gas Light (AGL) Resources (Docket Nos. 39971 and 9574). The $12 billion transaction is expected to create a major electric and natural gas utility with about 9 million customers across nine states.
The PSC-approved settlement of the merger includes a number of items to protect the ratepayers of AGL Resources and Georgia Power as well as consumers who receive natural gas from commission-certificated natural gas marketers in Georgia’s deregulated natural gas market.
“I believe this agreement contains safeguards for ratepayers and consumers, while at the same time allowing this merger to move forward in accordance with Georgia law and commission rules,” said Commission Chairman Chuck Eaton.
“Every intervener representing every class of ratepayers signed off on this. Every group acknowledged that this settlement is a huge benefit for the ratepayers who will benefit from this rate freeze for the next three years,” said Commissioner Stan Wise.
Georgia Power traditionally files a base electric rate case with the Georgia PSC every three years to consider new and existing costs to provide reliable electric service to its customers. The company’s next base electric rate case was originally scheduled for this summer. However, as part of the agreement, Georgia Power, Southern Company, AGL Resources, Georgia PSC staff , and other parties agreed that the company’s next base electric rate case should be postponed until July 2019 to ensure that benefits that the potential merger could bring to Georgia customers can be fully realized.
The company’s last base electric rate case in 2013 incorporated the costs of investments in infrastructure required in order to maintain high levels of reliability and superior customer service. Investments in place today as a result of this process include new environmental controls on the company’s generation fleet; and improvements in the transmission and distribution network such as smart grid technologies to limit the frequency and duration of power outages.
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