ATLANTA -- Georgia Power agreed last month to settle for a smaller rate increase than it had wanted, an agreement that won endorsement by nearly a dozen consumer, environmental and business advocacy groups, but one organization is fighting it.
The retiree-advocacy AARP is airing radio and online commercials and pushing a petition to urge the five members of the Public Service Commission to nix the agreement negotiated by its public-interest staff that slices the rate hike almost in half. Monday, the 1-million-member group reported collecting almost 3,000 signatures.
Its advertisement on WSB-AM in Atlanta points people to a website action.aarp.org/GAutilities where they can voice their opposition to the rate hike still part of the agreement as well as the reduced profit target. Georgia Power is accepting a reduction from 11.15 percent to 10.95, but the ad says that’s higher than the national average for other regulated monopoly utilities.
“In these tough economic times, Georgia families deserve to keep more of their hard-earned money in their pockets – by paying Georgia Power what’s fair and reasonable, and not a dime more,” said AARP spokesman Ed Van Herik.
He acknowledged that attractive profits encourage investors to put their money in Georgia Power to fund expansion rather than ratepayers having to foot all of it. The group wants the target dropped further to 10 percent.
“Fair and reasonable profit margins are good for utilities – and good for their customers. Under the proposed agreement, Georgia Power will still earn some of the highest allowed profits in the nation,” he said.
Georgia Power spokesman John Kraft said its customers benefit from that profit margin.
“To cut return to shareholders further could cause the very low interest rates we pay to rise, which would end up costing customers more, so we believe the balance reached in the settlement agreement continues to give us the flexibility to manage the business by taking care of our customers and meeting shareholder expectations,” he said.
The settlement also increases the discount low-income seniors get from $6 per month to $10.
Company executives testified that about half of the remaining rate increase is needed to pay for meeting tougher environmental regulations. AARP, though, didn’t offer a response when asked how those costs should be met if rates aren’t raised.
In the last seven rate cases since 1995, all have been worked out in an agreement between the company and the commission staff, and the resulting rates average 13 percent below the national average.
Georgia Power just finished a radio-ad campaign of its own in which it says “while our rates may change, we’re working hard to keep them well below the national average.” But none of the cost of the ad was billed to customers.
The commission votes Dec. 17 on the rate request. While most rate cases are based on agreements the staff has negotiated with the company, it’s also common for commissioners to make last-minute changes.
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