Georgia Power got a big tax break this year from state lawmakers, savings it is required to share with its customers.
On Wednesday, state regulators tasked with overseeing the monopoly’s prices voted to move up the start of that rebate, which they estimated will save the average household $2.25 a month for the first year, starting in January.
The savings are tiny compared to a series of increases approved by the same regulators over the past two years that cumulatively could add about $45 a month in additional costs for a typical residential customer by 2025, according to one analysis by the Southern Environmental Law Center.
Those rate hikes will continue as planned, said Tom Krause, a spokesman for the regulators on the Public Service Commission. The savings announced Thursday will help “offset” some of those changes, he said.
“Inflation has affected costs everywhere, including energy production,” Krause said in an email. “With this expedited savings, the PSC is trying to provide any relief it can.”
Credit: Miguel Martinez
Credit: Miguel Martinez
The savings, about $122 million total to be distributed among Georgia Power’s 2.7 million customers, are a result of Georgia slashing its corporate tax rate in the last legislative session. Georgia Power is required by regulators to pass on those tax benefits to customers, so the change would have resulted in savings for ratepayers regardless of the action taken this week to move it up by a year, Krause said.
The PSC vote moved the start date of the bill savings up from January 2026 to January 2025.
John Kraft, a spokesman for Georgia Power, said the savings will result in slightly overall lower rates for 2025 than otherwise would have been applied, but this will not be broken out or labeled separately on customers’ bills.
“Even with rates lower than the national average, we understand that any increase in bills matters, so we applaud efforts to quickly return these funds for the benefit of customers,” he said in an email.
Liz Coyle, executive director of Georgia Watch, a consumer advocacy organization that is active in energy regulation at a state level, said any relief for customers is welcome, but the savings are “a pretty small amount” compared to the increases.
Those include rate hikes to cover billions in cost overruns on the construction of two additional nuclear reactors at Plant Vogtle and to pay for transmission upgrades Georgia Power said it needs. Regulators also approved a separate increase to pass on fuel costs for Georgia Power’s fossil fuel-powered plants and nuclear generators.
Coyle said she’s heard from some customers whose bills have doubled or more compared to the same period last year.
“That’s just unaffordable for most Georgians,” Coyle said.
She also pointed to fallout from an ongoing federal lawsuit that has delayed elections for energy regulators on the PSC. The last election was held in 2020 and the next one is currently scheduled for next year.
“It’s been a long time since the voters of Georgia have had a chance to weigh in on who they want to represent them on the Public Service Commission,” Coyle said.
Out of five commissioners on the PSC, only one, Fitz Johnson, said through Krause, the PSC spokesman, that he was a Georgia Power customer at his primary residence.
Campaign finance disclosures for the other four commissioners show their home addresses in areas served by municipal or cooperative energy companies. A few own businesses or second properties that are Georgia Power customers.
The PSC regulates and sets rates for investor-owned utilities. That includes Georgie Power and Atlanta Gas Light, both subsidiaries of Southern Co., as well as Liberty Utilities, which is owned by a Canadian energy company. It also regulates landline telephones, pipeline safety and other issues.
“The Commissioners of the PSC are concerned about all ratepayers,” Krause said in a statement. “They recognize that all ratepayers, regardless of their provider, are experiencing increases in energy pricing nationally, and are doing all they can to mitigate that.”
The Public Service Commission also decides how much profit Georgia Power, which is granted a territorial monopoly by law, gets to keep. In 2022, the commission approved a target return on equity of 10.5%, above the industry average of 9.6%, according to S&P Global.
Georgia had the eighth-highest average monthly electricity bills in the country, between Florida and Massachusetts, even before the most recent increases took effect. That’s according to 2022 data from the federal Energy Information Administration and includes all electricity providers in Georgia, not just Georgia Power.
As customers feel the pinch of rate hikes, Georgia Power’s parent, Southern Co., has seen profits soar. The company reported in the second quarter profits rose to $1.2 billion, an increase of 43% over last year. Georgia Power is by far Southern’s most lucrative subsidiary.
Brionté McCorkle of Georgia Conservation Voters issued a statement that praised regulators for responding to customers facing “exorbitantly high power bills,” but warned against public complacency.
“While every little bit helps, (Georgia) Power has passed billions onto normal people, so this is a drop in the bucket,” she said. “Residents need to stay vigilant.”
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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