Just saw the news that the Georgia PSC approved Georgia Power's request for a $1.1 billion rate increase over three years. This includes $758 million for the Vogtle nuclear expansion and another $350 million for transmission and distribution upgrades. Residential customers are looking at about a 10% increase in their monthly bills. The construction work in progress recovery for Vogtle is particularly concerning - ratepayers are essentially financing a project that might never be completed.
Georgia PSC approves Georgia Power's $1.1B rate increase
I'm in the same territory, Rachel, and my commercial clients are furious. The Large General Service schedule is going from $0.0847/kWh to $0.0934/kWh for energy charges. What really bothers me is how they're handling the CWIP recovery. Traditional ratemaking says you don't recover costs until the plant is used and useful, but Georgia's getting around that with their Construction Work in Progress tariff rider.
Similar pattern here in North Carolina, though Duke hasn't been as aggressive with CWIP recovery. The problem with Vogtle is that it's already years behind schedule and billions over budget. Georgia Power originally estimated $14.1 billion for Units 3 and 4, but they're now projecting over $25 billion. Ratepayers are bearing all that construction risk while shareholders get a guaranteed return.
Derek, that's exactly the issue. The PSC approved a 10.95% return on equity for the Vogtle investment, which is incredibly generous given the project risks. Meanwhile, ratepayers get stuck with cost overruns and delays. I've been arguing that prudency reviews should happen in real-time, not just when the plant comes online. By then it's too late to disallow imprudent costs.
The transmission portion of this rate case was easier to swallow - about $120 million for legitimate system upgrades including new substations in Gwinnett and Cobb counties. But bundling it with Vogtle costs made it harder to oppose the whole package. Georgia Power was smart to package everything together. Individual components might not have survived separate scrutiny.
The precedent this sets is dangerous. Other utilities will point to Georgia's CWIP recovery as justification for similar treatment of large construction projects. We're already seeing Southern Company push for comparable arrangements in Alabama and Mississippi for their fossil plants. The traditional regulatory compact is getting turned on its head.