Georgia Power defends planned 12% electricity rate hike for customers to state regulators

A series of hearings on Georgia Power’s plans for a 12% increase in electricity rates over the next three years began Tuesday morning at the Public Service Commission in Atlanta.

The hearing’s cross-examinations began with a testy exchange between the Public Service Commission’s staff attorney Preston Thomas and Georgia Power CEO Chris Womack about how much money the utility company expects to collect from customers over the next three years.

“As you’re aware, you’re requesting an additional roughly $3 billion in revenue from customers over the next three years, 2023 through 2025,” Thomas said. “Has Georgia Power ever asked for a rate increase of this magnitude, $3 billion over three years?”

“I would say to you our request is a little bit over $1 billion, and yeah, we have made similar requests before,” Womack replied.

Thomas seemed taken aback by the CEO’s response.

“So are you disagreeing with the question that the request is roughly $3 billion?” he asked.

“I don’t want to make an assumption but I think you’re looking at it from a cumulative approach,” Womack responded, and said the utility is only requesting an extra $1 billion from customers over the next three years.

Thomas said he was citing Georgia Power’s own filings to the PSC, the regulatory body which must approve or deny the request for a rate hike.

Thomas walked to the witness stand in which Womack was seated, handed him documents, and asked, “Looking at that scheduling for years ’23, ’24 and ’25, would you agree that the total ask for those three years is roughly $2.9 billion without the franchise fees?”

“I can’t agree to that at this time,” Womack said.

But Thomas pressed on. “It’s a schedule from your filing,” he said, before reading the list of figures included for each year.

“It comes out to roughly 2.9 billion, correct?” Thomas asked.

“I haven’t added it up at this point,” said Womack.

After several rounds of back-and-forth over the figures, Brandon Marzo, an attorney for Georgia Power, stepped in to ask that the line of questioning be ended.

“The staff wants to do a different type of math,” he said.

Thomas disagreed, saying Womack had not answered his question regarding whether he disputed the larger cost estimate.

The argument was rehashed later in the hearing during a cross-examination of Georgia Power’s chief financial officer Aaron Abramovitz by Dan Walsh, an attorney in the state Attorney General’s office.

Abramovitz said both figures are accurate, but represent different calculations.

“This is where the disagreement is here. Yes, you can add up three years of revenue and get to that number [$2.9 billion]. That is a cumulative basis,” Abramovitz said.

But Abramovitz said Georgia Power had used a different method: “The way that we look at the changes to rates, up or down, is on an incremental basis, and our incremental change to rates with this request is approximately $1 billion over 3 years.”

The Atlanta Journal-Constitution reported Monday that the proposed rate hike amounted to “roughly $2.8 billion over three years,” adding that this figure “dwarfs the nearly $1.8 billion plan approved in 2019 by the PSC.”

The “rate case” hearings are a trial-like process in which the commissioners on the PSC and a variety of interested organizations known as “intervenors” are given the chance to question expert witnesses and utility executives about their proposals.

The hearings are being livestreamed by the PSC on its YouTube channel.

This story was originally published September 28, 2022 at 1:42 PM with the headline "Georgia Power defends planned 12% electricity rate hike for customers to state regulators."