The Georgia Public Service Commission on Thursday approved an agreement that sets up Georgia Power customers for lower bills starting next month — but consumer and clean energy advocates argue the deal does not go far enough in shielding them from future costs.
The panel’s unanimous decision on two high-profile cost issues will save the average residential customer about $4.04 a month starting in June. It is the second time in a year that Georgia Power and its utility regulator have agreed to freeze or lower rates for customers after raising them six times in three years.
The savings are greater than the $1.32 a month reduction Georgia Power proposed in February. Georgia Power and members of the PSC’s public interest advocacy staff came up with a subsequent agreement, known as a stipulation, which took the decrease even further.
“The stipulation is a very good deal for customers,” Steven Hewitson, a lawyer representing Georgia Power, said during a specially scheduled PSC meeting.
The move has also happened during an election cycle in which one of the outcomes would make a historically Republican commission one that is controlled by Democrats.
“I appreciate the hard work of staff on these two major cases ... the work does not go unnoticed, the results do not go unnoticed, the savings to ratepayers do not go unnoticed,” said PSC Chairperson Jason Shaw, at the end of a two-hour-long session.
At issue was covering Georgia Power’s costs of cleaning up infrastructure and restoring power after pop-up storms and Hurricane Helene, a Category 2 storm that ripped through parts of the state in 2024. Georgia Power said it was the most destructive storm in the utility‘s history.
The second matter was paying for the cost of fuel Georgia Power uses at its power plants to make electricity. Much of Georgia Power’s fuel comes from gas, a fossil fuel subject to wide price swings. The number of gas-fired power plants in Georgia Power’s system is going to grow as the company embarks on an unprecedented expansion of its power grid, mostly to serve data centers.
Environmental and consumer advocates reiterated their argument that the company’s storm and fuel costs would be lower if the utility relied less on fossil fuels and more on renewable energy, which has infrastructure costs but the fuel is free.
Fossil fuels also are a significant contributor to climate change, which has caused extreme weather like Helene to tear through a state that used to rarely get hit by hurricanes.
The company is allowed to pass on these costs to customers, which means it has no incentive to look for cleaner, less-expensive fuel options, argued Michael Hawthorne representing the Sierra Club, the Southern Alliance for Clean Energy and the National Resources Defense Council.
“Georgia Power bears none of the consequences for its fuel-related decisions,” Hawthorne said, calling the company’s decision to sometimes buy coal at above-market prices when other options were available the “clearest moral hazard example in this case.”
What’s more, even though the PSC approved new billing structures for data centers to ensure they pay their fair share of costs, advocates say non-data center customers are shouldering the bill for all the infrastructure needed to support them.
“The data center customers pay their fuel costs, but no offset is provided to the rising costs that they are causing other customers to bear,” said Bob Sherrier, a lawyer with the Southern Environmental Law Center who is representing Georgia Interfaith Power & Light and Southface.
Sherrier said those costs include: new pipelines that will deliver fuel to the power plants that will mostly serve data centers; low-income qualified discount programs for residents struggling to pay their higher utility bills; and a hedging program that can help manage unpredictable fuel prices, an issue that is exacerbated by skyrocketing electricity demand by data centers.
“Existing customers are subsidizing data centers’ fuel costs,” he said.
Hewitson, the Georgia Power lawyer, disagreed with Sherrier’s allegations and said the details will be discussed in another case later this year. He argued that data center operators are paying more than their fair share of costs and also will be contributing to lower base rates in the future.
He was referring to an agreement in which Georgia Power will use revenue from data centers to tamp down future base rates by $8.50.
“Claims that large load customers are not paying their share of the costs ignores the massive benefits to base rates that these large load customers are bringing to the system,” he said. “The massive benefit is on the base rate side.”
A note of disclosure
This coverage is supported by a partnership with Green South Foundation and Journalism Funding Partners. You can learn more and support our climate reporting by donating at AJC.com/donate/climate.
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