State News

October 12, 2013

Georgia Power seeks more money for storm damage

Georgia Power wants more money from customers to cover the cost of repairing storm damage to the electrical system, just one of many decisions that regulators will consider before deciding how much the utility can charge.

The Southern Co. subsidiary has requested that it be allowed to collect about $37 million annually from its nearly 2.4 million customers over a three-year period for the cost of weather-inflicted damage, according to documents filed with state regulators. That’s a doubling of the current collections.

Storms can inflict expensive damage on the electrical grid, toppling trees that break power lines and wrecking other critical infrastructure. As a monopoly, Georgia Power gets legally guaranteed profits and the nearly exclusive right to sell power in its service territory. However, it’s also required to run and maintain the electrical grid.

Before proposing where to set rates, utility officials examine cost trends over the past five years. Damage during that period averaged nearly $23 million, but the power company could collect only $18 million annually to cover it. This time, Georgia Power has asked the Public Service Commission to raise the fixed annual collection and also get reimbursed for past spending.

The charge “needs to be set at a level that will not only cover the cost of any new storms over the next three years but also reimburse the Company for unrecovered storm costs already incurred since the last case,” said Laura Patterson and Elliott Spencer, both assistant comptrollers for the utility, in written testimony.

The recent peak in spending came in 2011. Besides the usual wear-and-tear from strong weather, Georgia was hit by an ice storm that crippled metro Atlanta in January 2011 and significant damage from April tornadoes in that rolled across Alabama, Georgia and Tennessee. Severe thunderstorms inflicted further damage that summer.

Regulators must decide the storm damage issue as part of a larger rate case. Georgia Power has proposed a three-year plan that includes a price hike of nearly $8 for a typical residential customer. A decision is expected in December.

 

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