PRNewswire -- Southern Company Chairman, President and CEO David M. Ratcliffe on June 18 announced that the company's Georgia Power subsidiary has reached an agreement with the U.S. Department of Energy (DOE) to accept terms for a conditional commitment for loan guarantees.
"This will provide Georgia Power customers significant savings," said Georgia Power President and CEO Mike Garrett.
President Obama and DOE Secretary Steven Chu announced the award of the conditional loan guarantees to Georgia Power on February 16.
"This is another step forward on the road to nuclear power playing a prominent role in America's energy future," said Ratcliffe. "Nuclear energy is vital in any effort to make meaningful reductions in greenhouse gas emissions and meet this nation's rising demand for electricity. This conditional commitment is an endorsement of the company's performance as a safe, efficient nuclear operator with strong financial integrity."
The new units will be located at Plant Vogtle near Waynesboro, Ga., where the company already owns and operates two nuclear units. The conditional commitment is for loan guarantees that would apply to future borrowings related to the construction of Vogtle units 3 and 4.
Total guaranteed borrowings would not exceed 70 percent of the company's eligible projected costs, or approximately $3.4 billion, and are expected to be funded by the Federal Financing Bank. Any guaranteed borrowings would be full recourse to Georgia Power and secured by a first priority lien on the company's 45.7 percent ownership interest in the two new units.
Final approval and issuance of the loan guarantees are subject to receipt of the Combined Operating License from the U.S. Nuclear Regulatory Commission (NRC), completion of final agreements, the receipt of any other required regulatory approvals and satisfaction of other conditions. The company received an early site permit and limited work authorization from the NRC for the two additional units in 2009, and site work has begun.
The additions of units 3 and 4 are expected to produce approximately 3,500 jobs during construction and 800 permanent jobs once the units begin operation.
Along with Georgia Power's existing portion of the two 1,100-megawatt reactors, the remaining ownership is split among Oglethorpe Power Corporation, the Municipal Electric Authority of Georgia and Dalton Utilities. Georgia Power's share of the project cost is currently projected at approximately $6.1 billion, which includes approximately $1.7 billion of financing costs to be collected during construction.
The DOE loan guarantees are expected to save Georgia Power's customers millions in interest costs annually over the expected life of any guaranteed borrowings, based on preliminary estimates. The actual amount of the interest savings will depend upon the final terms and the timing of the specific borrowings and cannot be determined at this time.
Units 3 and 4 are expected to begin commercial operation in 2016 and 2017, respectively. Southern Nuclear, a subsidiary of Southern Company, will oversee the construction as well as operate the two new units for Georgia Power and the other owners. Southern Nuclear currently operates Plant Vogtle's two existing nuclear power units as well as Georgia Power's Plant Hatch nuclear facility near Baxley, Ga., and Alabama Power's Plant Farley nuclear facility near Dothan, Ala.
Georgia Power is the largest subsidiary of Southern Company. The company is an investor-owned, tax-paying utility with rates well below the national average. Georgia Power serves 2.3 million customers in all but four of Georgia's 159 counties.
With 4.4 million customers and more than 42,000 megawatts of generating capacity, Atlanta-based Southern Company (NYSE:SO) is the premier energy company serving the Southeast. A leading U.S. producer of electricity, Southern Company owns electric utilities in four states and a growing competitive generation company, as well as fiber optics and wireless communications. Southern Company brands are known for excellent customer service, high reliability and retail electric prices below the national average. Southern Company is consistently listed among the top U.S. electric service providers in customer satisfaction by the American Customer Satisfaction Index (ACSI). Visit our Web site at www.southerncompany.com.
Cautionary Note Regarding Forward-Looking Statements:
Certain information contained in this release is forward-looking information based on current expectations and plans that involve risks and uncertainties. Forward-looking information includes, among other things, statements concerning the conditional commitment and DOE loan guarantees, estimated cost savings from DOE loan guarantees, and projected costs of construction and in service dates for Vogtle units 3 and 4. Southern Company and Georgia Power caution that there are certain factors that can cause actual results to differ materially from the forward-looking information that has been provided. The reader is cautioned not to put undue reliance on this forward-looking information, which is not a guarantee of future performance and is subject to a number of uncertainties and other factors, many of which are outside the control of Southern Company and Georgia Power; accordingly, there can be no assurance that such suggested results will be realized. The following factors, in addition to those discussed in the Annual Reports on Form 10-K of Southern Company and Georgia Power for the year ended December 31, 2009, and subsequent securities filings, could cause actual results to differ materially from management expectations as suggested by such forward-looking information: timely receipt of necessary regulatory approvals related to the Plant Vogtle expansion, including Georgia Public Service Commission and NRC approvals; interest rate fluctuations and financial market conditions, including the credit ratings of Southern Company and Georgia Power; satisfaction of all conditions to the final issuance and approval of DOE loan guarantees, including negotiation of final agreements, continuing due diligence by the DOE and receipt of any required regulatory approvals; and the ability to control costs and avoid delays in the construction of Plant Vogtle units 3 and 4, including risks related to shortages and inconsistent quality of equipment, materials and labor, work stoppages, contractor or supplier non-performance under construction or other agreements, adverse weather conditions, unforeseen engineering problems, changes in project design or scope, environmental and geological conditions, and unanticipated cost increases. Southern Company and Georgia Power expressly disclaim any obligation to update any forward-looking information.
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Monday, June 21, 2010
Thursday, June 17, 2010
Friends of the Earth: Billions of Dollars in Tax Breaks for Each New Reactor Under Kerry-Lieberman Wipe Out Risk for Utilities Already Benefiting From Massive Loan Guarantees
/USNewswire/ -- The nuclear industry could end up facing no risk under massive tax break subsidies in the Kerry-Lieberman climate bill, according to an important new analysis conducted for Friends of the Earth by the research organization Earth Track. These tax breaks totaling $9.7 billion to $57.3 billion (depending on the type and number of reactors) would come on top of the Kerry-Lieberman measure's lucrative $35.5 billion addition to the more than $22.5 billion in loan guarantees already slated for nuclear power.
Friends of the Earth President Erich Pica said: "Doling out an additional $1.3-$3 billion in tax breaks per new reactor means the industry would be at the table playing almost entirely with taxpayer money. Industry will have little to lose when a reactor goes belly up. While taxpayers are bankrolling the industry's nuclear gamble they would share in none of the reactor's financial returns. In fact, all taxpayers will receive if the reactors are built is responsibility for disposing of the waste. By contrast, investors stand to make billions with no risk should their reactor gambit goes belly up and enter bankruptcy."
Earth Track Founder Doug Koplow said: "These substantial tax breaks for new reactors greatly impede market access for competing energy sources and worsen the already substantial risks to taxpayers from a nuclear build-out. As has clearly been shown in U.S. mortgage markets, the likelihood of bad financial decisions rises sharply if only other people's capital is at risk. Kerry-Lieberman's nuclear tax breaks do just this by replacing investor equity with taxpayer money, and allowing investment tax credits to be claimed even before the reactor is operating. The provision to recover credits in the event a reactor is cancelled or suspended is unlikely to be effective in the most likely cause of termination - a bankruptcy due to poor economics."
The memo evaluates three tax break subsidies, describing how they work and estimating their subsidy value to recipients in the nuclear power sector:
-- 5-year accelerated depreciation period for new nuclear power plants
(Kerry-Lieberman section 1121).
-- Investment tax credit (ITC) for nuclear power facilities (K-L section
1122) and the related grants for qualified nuclear power facility
expenditures in lieu of tax credits (K-L section 1126).
-- Modification of credit for production from advanced nuclear power
facilities (K-L section 1124).
According to the Earth Track analysis:
-- The K-L tax breaks would be worth billions per reactor. The new
subsidies will be worth between $1.3 billion and nearly $3.0 billion
on a net present value per new reactor. This is equivalent to between
15 and 20 percent of the total all-in cost of the reactors, as
projected by industry. In fact, the new nuclear tax break subsidies
would be worth 15 to more than 50 percent of the expected market value
of power the plants will produce. This is over and above the many
other subsidies the nuclear projects would already receive.
-- The new K-L tax breaks will undermine equity requirements of the
nuclear loan guarantee program. In theory, the current rules require
investors to hold a 20 percent equity stake in the new project. A key
goal of this requirement is to ensure investors have a strong interest
in the long-term success of the venture. However, the K-L bill would
in effect allow investors to recover funds equal to this equity share
within the first few years of plant operation. Financial risks from
project failure would then rest almost entirely with taxpayers.
-- Total tax subsidies to new reactors could reach tens of billions of
dollars from K-L's two main tax breaks alone. The national cost of
K-L's tax provisions can be benchmarked by evaluating two build-out
scenarios: six reactors, matching the number likely to be supported
under K-L's expanded nuclear loan guarantee pool; and 22 reactors,
matching the number going through NRC licensing as of May 2010. As not
all reactors will be the same type, the calculations assume half are
AP1000s and half Areva EPRs. Under a six-reactor scenario, K-L will
add $9.7 billion to $15.6 billion in tax subsidies to nuclear power.
Under a 22-reactor scenario, the net present value of subsidies on
offer just through 5-year depreciation and ITCs reaches $35.7 billion
to $57.3 billion. Neither of these other subsidies have any national
caps under Kerry-Lieberman.
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Friends of the Earth President Erich Pica said: "Doling out an additional $1.3-$3 billion in tax breaks per new reactor means the industry would be at the table playing almost entirely with taxpayer money. Industry will have little to lose when a reactor goes belly up. While taxpayers are bankrolling the industry's nuclear gamble they would share in none of the reactor's financial returns. In fact, all taxpayers will receive if the reactors are built is responsibility for disposing of the waste. By contrast, investors stand to make billions with no risk should their reactor gambit goes belly up and enter bankruptcy."
Earth Track Founder Doug Koplow said: "These substantial tax breaks for new reactors greatly impede market access for competing energy sources and worsen the already substantial risks to taxpayers from a nuclear build-out. As has clearly been shown in U.S. mortgage markets, the likelihood of bad financial decisions rises sharply if only other people's capital is at risk. Kerry-Lieberman's nuclear tax breaks do just this by replacing investor equity with taxpayer money, and allowing investment tax credits to be claimed even before the reactor is operating. The provision to recover credits in the event a reactor is cancelled or suspended is unlikely to be effective in the most likely cause of termination - a bankruptcy due to poor economics."
The memo evaluates three tax break subsidies, describing how they work and estimating their subsidy value to recipients in the nuclear power sector:
-- 5-year accelerated depreciation period for new nuclear power plants
(Kerry-Lieberman section 1121).
-- Investment tax credit (ITC) for nuclear power facilities (K-L section
1122) and the related grants for qualified nuclear power facility
expenditures in lieu of tax credits (K-L section 1126).
-- Modification of credit for production from advanced nuclear power
facilities (K-L section 1124).
According to the Earth Track analysis:
-- The K-L tax breaks would be worth billions per reactor. The new
subsidies will be worth between $1.3 billion and nearly $3.0 billion
on a net present value per new reactor. This is equivalent to between
15 and 20 percent of the total all-in cost of the reactors, as
projected by industry. In fact, the new nuclear tax break subsidies
would be worth 15 to more than 50 percent of the expected market value
of power the plants will produce. This is over and above the many
other subsidies the nuclear projects would already receive.
-- The new K-L tax breaks will undermine equity requirements of the
nuclear loan guarantee program. In theory, the current rules require
investors to hold a 20 percent equity stake in the new project. A key
goal of this requirement is to ensure investors have a strong interest
in the long-term success of the venture. However, the K-L bill would
in effect allow investors to recover funds equal to this equity share
within the first few years of plant operation. Financial risks from
project failure would then rest almost entirely with taxpayers.
-- Total tax subsidies to new reactors could reach tens of billions of
dollars from K-L's two main tax breaks alone. The national cost of
K-L's tax provisions can be benchmarked by evaluating two build-out
scenarios: six reactors, matching the number likely to be supported
under K-L's expanded nuclear loan guarantee pool; and 22 reactors,
matching the number going through NRC licensing as of May 2010. As not
all reactors will be the same type, the calculations assume half are
AP1000s and half Areva EPRs. Under a six-reactor scenario, K-L will
add $9.7 billion to $15.6 billion in tax subsidies to nuclear power.
Under a 22-reactor scenario, the net present value of subsidies on
offer just through 5-year depreciation and ITCs reaches $35.7 billion
to $57.3 billion. Neither of these other subsidies have any national
caps under Kerry-Lieberman.
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Saturday, June 12, 2010
PSC Candidate Tim Echols to headline “Energy Forum” in Savannah, Valdosta, and Marietta
With pending rate increases, an oil spill in the Gulf of Mexico, and the looming “Cap and Trade” federal legislation on the horizon, energy is a “hot topic” issue.
Three “forums” are slated to allow the public to listen and discuss the future of energy in the state of Georgia. Two key speakers will be Sam Fleet, the state director for the Pickens Plan, and Tim Echols, candidate for the Public Service Commission, a statewide seat. Other speakers will be announced soon
“Foreign oil is a threat to American safety,” says Fleet. “It’s time to move forward to energy independence and bring more jobs to America and the state of Georgia.”
Echols has been traveling the state promoting nuclear power, renewable energy and the conversion of municipal vehicles to CNG (compressed natural gas). “I think the potential cost overruns for the new nuclear reactors at Plant Vogtle will be the biggest issue during my six year term,” said Echols. “If Pres. Obama somehow passes Cap and Trade, however, Georgia may face unprecedented energy cost increases in order to comply. It will not be good for our state.”
Stephen Morris, the official organizer of the events, said that many Georgians feel they don’t have enough input into the Public Service Commission hearing process. “These meetings will give the ordinary citizen a chance to listen, learn and offer suggestions to opinion leaders like Fleet and Echols,” said Morrison, a college student from Savannah.
Savannah Event Details: June 16, Wed, 12pm to 1:30pm at the Southwest Chatham Library at 14097 Abercorn Street, Savannah, GA 31419 (behind Target at Savannah Mall)
Valdosta Event Details: June 18, Friday, 12:30pm to 2pm at the Valdosta Library at Valdosta-Lowndes County Library, 300 Woodrow Wilson Drive in Valdosta, Georgia 31602.
Cobb Event Details: June 24, Thursday, 4:30pm to 6:00pm at the East Marietta Public Library, 2051 Lower Roswell Road Marietta, GA 30068-3352.
To see more on Sam Fleet and the Pickens Plan, go to http://www.pickensplan.com/news/2010/05/22/georgia-state-leader-traveling-across-to-georgia-to-support-pickens-plan/
Echols’ newest campaign commercial can be seen at http://www.youtube.com/watch?v=2h3d6MOCRYQ
More information on his criteria for can be found at www.timechols.com
Three “forums” are slated to allow the public to listen and discuss the future of energy in the state of Georgia. Two key speakers will be Sam Fleet, the state director for the Pickens Plan, and Tim Echols, candidate for the Public Service Commission, a statewide seat. Other speakers will be announced soon
“Foreign oil is a threat to American safety,” says Fleet. “It’s time to move forward to energy independence and bring more jobs to America and the state of Georgia.”
Echols has been traveling the state promoting nuclear power, renewable energy and the conversion of municipal vehicles to CNG (compressed natural gas). “I think the potential cost overruns for the new nuclear reactors at Plant Vogtle will be the biggest issue during my six year term,” said Echols. “If Pres. Obama somehow passes Cap and Trade, however, Georgia may face unprecedented energy cost increases in order to comply. It will not be good for our state.”
Stephen Morris, the official organizer of the events, said that many Georgians feel they don’t have enough input into the Public Service Commission hearing process. “These meetings will give the ordinary citizen a chance to listen, learn and offer suggestions to opinion leaders like Fleet and Echols,” said Morrison, a college student from Savannah.
Savannah Event Details: June 16, Wed, 12pm to 1:30pm at the Southwest Chatham Library at 14097 Abercorn Street, Savannah, GA 31419 (behind Target at Savannah Mall)
Valdosta Event Details: June 18, Friday, 12:30pm to 2pm at the Valdosta Library at Valdosta-Lowndes County Library, 300 Woodrow Wilson Drive in Valdosta, Georgia 31602.
Cobb Event Details: June 24, Thursday, 4:30pm to 6:00pm at the East Marietta Public Library, 2051 Lower Roswell Road Marietta, GA 30068-3352.
To see more on Sam Fleet and the Pickens Plan, go to http://www.pickensplan.com/news/2010/05/22/georgia-state-leader-traveling-across-to-georgia-to-support-pickens-plan/
Echols’ newest campaign commercial can be seen at http://www.youtube.com/watch?v=2h3d6MOCRYQ
More information on his criteria for can be found at www.timechols.com
Thursday, June 10, 2010
APOGEE Interactive Websites Take Top Honors in National Rural Electric Cooperative Association Annual Competition
/PRNewswire/ -- APOGEE Interactive, an industry-leading provider of online solutions to energy utilities, dominated the winners' circle in the Best Website category of this year's Spotlight on Excellence competition hosted by the National Rural Electric Cooperative Association and the Council of Rural Electric Communicators.
Two APOGEE clients earned honors for websites -- the most award winners posted by a single vendor in the Best Website category.
Spotlight on Excellence recognizes electric cooperatives for high-quality communication and marketing efforts. The NRECA member websites were judged on criteria such as relevant and concise text, easy navigation, distinctive appearance, and engaging opportunities for visitor interaction. More than 800 entries were submitted in this year's competition and were judged by faculty members of the distinguished journalism schools at the University of Missouri-Columbia and the University of North Carolina at Chapel Hill.
Apogee has designed, built and hosts more than 150 utility websites nationwide, many earning a variety of industry accolades each year ranging from NRECA's to the Public Relations Society of America.
Flint Energies Inc. (www.flintenergies.com), a member-owned electric cooperative based in Warner Robins, Ga., won the Award of Excellence in the Best Website category. Flint is one of APOGEE's original website clients dating back to the mid '90s and this winning website version was revamped and redesigned by Apogee in 2009. The site includes a self-serve Home Energy Audit for customers, a HomeEnergySuite with a virtual home 'tour' of energy costs, and a CommercialEnergySuite for business and industry clients - all developed by Apogee.
Georgia EMC (www.georgiaemc.com), the statewide EMC trade association based in Tucker, Ga., and another longtime APOGEE client, earned an Award of Merit. Redesigned and newly launched last year by APOGEE, this site features a comprehensive Members Center for EMC associates, Calendar and Media centers, and numerous pages with information on green power, energy efficiency, statewide legislative initiatives and community outreach.
"We're dedicated to helping our utility clients achieve highly positive website interactions with their members and consumers," said APOGEE President and Chief Executive Officer Susan Gilbert. "In addition to engaging design and intuitive navigation, our expertise also includes compelling energy efficiency tools that are fun and easy to use, which all help create positive user experiences and energy-saving behavior."
APOGEE Interactive Inc. (www.apogee.net)
Founded in 1994, APOGEE is a leading provider of online energy efficiency solutions to energy utilities. The company's energy analysis applications are currently in use by more than 450 utilities across the US, reaching millions of consumers daily, and its website client roster now exceeds 150 companies. APOGEE's clients include leading investor-owned, public power and cooperative energy companies including Flint Energies, Georgia EMC, Marietta Power & Water, Southern Company (SO), Cobb EMC, Con Edison (ED), BGE (CEG), NSTAR (NST), American Electric Power (AEP), Entergy (ETR), SMUD, Puget Sound Energy and Jackson EMC.
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Two APOGEE clients earned honors for websites -- the most award winners posted by a single vendor in the Best Website category.
Spotlight on Excellence recognizes electric cooperatives for high-quality communication and marketing efforts. The NRECA member websites were judged on criteria such as relevant and concise text, easy navigation, distinctive appearance, and engaging opportunities for visitor interaction. More than 800 entries were submitted in this year's competition and were judged by faculty members of the distinguished journalism schools at the University of Missouri-Columbia and the University of North Carolina at Chapel Hill.
Apogee has designed, built and hosts more than 150 utility websites nationwide, many earning a variety of industry accolades each year ranging from NRECA's to the Public Relations Society of America.
Flint Energies Inc. (www.flintenergies.com), a member-owned electric cooperative based in Warner Robins, Ga., won the Award of Excellence in the Best Website category. Flint is one of APOGEE's original website clients dating back to the mid '90s and this winning website version was revamped and redesigned by Apogee in 2009. The site includes a self-serve Home Energy Audit for customers, a HomeEnergySuite with a virtual home 'tour' of energy costs, and a CommercialEnergySuite for business and industry clients - all developed by Apogee.
Georgia EMC (www.georgiaemc.com), the statewide EMC trade association based in Tucker, Ga., and another longtime APOGEE client, earned an Award of Merit. Redesigned and newly launched last year by APOGEE, this site features a comprehensive Members Center for EMC associates, Calendar and Media centers, and numerous pages with information on green power, energy efficiency, statewide legislative initiatives and community outreach.
"We're dedicated to helping our utility clients achieve highly positive website interactions with their members and consumers," said APOGEE President and Chief Executive Officer Susan Gilbert. "In addition to engaging design and intuitive navigation, our expertise also includes compelling energy efficiency tools that are fun and easy to use, which all help create positive user experiences and energy-saving behavior."
APOGEE Interactive Inc. (www.apogee.net)
Founded in 1994, APOGEE is a leading provider of online energy efficiency solutions to energy utilities. The company's energy analysis applications are currently in use by more than 450 utilities across the US, reaching millions of consumers daily, and its website client roster now exceeds 150 companies. APOGEE's clients include leading investor-owned, public power and cooperative energy companies including Flint Energies, Georgia EMC, Marietta Power & Water, Southern Company (SO), Cobb EMC, Con Edison (ED), BGE (CEG), NSTAR (NST), American Electric Power (AEP), Entergy (ETR), SMUD, Puget Sound Energy and Jackson EMC.
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Wednesday, May 26, 2010
GreyStone Power Corporation Enters Into $600 Million + Power Purchase and Scheduling Agent Services Agreement with Morgan Stanley Capital Group
/PRNewswire/ -- On May 12, 2010, the Board of Directors of GreyStone Power Corporation ("GreyStone") approved a five-year Power Purchase and Scheduling Agent Services Agreement with Morgan Stanley Capital Group. The Agreement is valued at more than $600 million.
Background
GreyStone is a member-owned, non-profit rural electric distribution cooperative located on the west side of Atlanta serving portions of eight metropolitan Atlanta counties. Its main office is located at 4040 Bankhead Highway, Douglasville, GA 30134.
GreyStone is one of the largest members of Oglethorpe Power Corporation, the generation supplier from which GreyStone purchases most of its power needs. Under its agreement with Oglethorpe, GreyStone is permitted to procure its remaining power requirements from competitive wholesale power suppliers if it so chooses.
Morgan Stanley Capital Group is a subsidiary of Morgan Stanley and is engaged in wholesale sales and purchases of electricity throughout the United States, including Georgia. Morgan Stanley has been an active participant in the Georgia market for a number of years.
GreyStone conducted a competitive procurement beginning in January by issuing a form of agreement to a selected list of potential power suppliers. GreyStone negotiated an agreement with each potential power supplier and asked each to price their respective agreement. GreyStone selected Morgan Stanley from the competing power suppliers based on the consideration of price and contract terms.
The Power Purchase and Scheduling Agent Services Agreement
The agreement provides that Morgan Stanley will schedule the energy from GreyStone's resources or provide power from the market, whichever is more economical, to serve all of GreyStone's load.
The agreement will allow GreyStone to adapt to changing legal, public policy and regulatory requirements, and to purchase renewable and alternative energy, and implement demand response, net metering and other new technologies.
Gary Miller, the President and Chief Executive officer of GreyStone, stated: "We selected Morgan Stanley after an extensive and competitive procurement process in which we sought the best combination of price and contract terms. We were pleased with Morgan Stanley's willingness to work with us and believe we have obtained a well priced agreement for GreyStone's members that also provides flexibility to adapt to changing circumstances in the future."
Alex Tolstykh, Managing Director and Head of Southeast/Mid-West Power and Gas at Morgan Stanley said: "We are excited to be selected as supplier to GreyStone and look forward to doing a great job serving GreyStone's power needs during the contract and beyond."
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Background
GreyStone is a member-owned, non-profit rural electric distribution cooperative located on the west side of Atlanta serving portions of eight metropolitan Atlanta counties. Its main office is located at 4040 Bankhead Highway, Douglasville, GA 30134.
GreyStone is one of the largest members of Oglethorpe Power Corporation, the generation supplier from which GreyStone purchases most of its power needs. Under its agreement with Oglethorpe, GreyStone is permitted to procure its remaining power requirements from competitive wholesale power suppliers if it so chooses.
Morgan Stanley Capital Group is a subsidiary of Morgan Stanley and is engaged in wholesale sales and purchases of electricity throughout the United States, including Georgia. Morgan Stanley has been an active participant in the Georgia market for a number of years.
GreyStone conducted a competitive procurement beginning in January by issuing a form of agreement to a selected list of potential power suppliers. GreyStone negotiated an agreement with each potential power supplier and asked each to price their respective agreement. GreyStone selected Morgan Stanley from the competing power suppliers based on the consideration of price and contract terms.
The Power Purchase and Scheduling Agent Services Agreement
The agreement provides that Morgan Stanley will schedule the energy from GreyStone's resources or provide power from the market, whichever is more economical, to serve all of GreyStone's load.
The agreement will allow GreyStone to adapt to changing legal, public policy and regulatory requirements, and to purchase renewable and alternative energy, and implement demand response, net metering and other new technologies.
Gary Miller, the President and Chief Executive officer of GreyStone, stated: "We selected Morgan Stanley after an extensive and competitive procurement process in which we sought the best combination of price and contract terms. We were pleased with Morgan Stanley's willingness to work with us and believe we have obtained a well priced agreement for GreyStone's members that also provides flexibility to adapt to changing circumstances in the future."
Alex Tolstykh, Managing Director and Head of Southeast/Mid-West Power and Gas at Morgan Stanley said: "We are excited to be selected as supplier to GreyStone and look forward to doing a great job serving GreyStone's power needs during the contract and beyond."
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Tuesday, May 25, 2010
Waste Management Debuts New Landfill-Gas-to-Energy Facility at Superior Landfill in Savannah, Ga.
PRNewswire -- Waste Management today debuted a landfill-gas-to-energy facility at its Superior Landfill and Recycling Center, which uses methane gas to power up to 3,400 homes in the surrounding area. More than 100 state and local officials, business and community leaders gathered for an opening event and tours showcasing the new facility.
The facility is among the largest of its kind in Georgia and the Southeast, according to U.S. Environmental Protection Agency (EPA) data. It represents a new source of green energy entering the power grid, lessening our dependence on fossil fuels. Methane gas -- created from the natural decomposition of waste -- is taken from the landfill through a series of wells placed around the site. From there, gas is used to power eight large engines to generate electricity, creating approximately 6.4 megawatts of power.
"The opening of this facility represents a new source of clean, renewable energy for our community," said Robby White, district manager for Waste Management in Savannah. "It is an environmentally responsible way to harness the energy from the waste we all generate."
Georgia Power and Waste Management Renewable Energy LLC entered into a 10-year deal for electricity, which was approved by the Georgia Public Service Commission in April. Georgia Power selected Waste Management from a number of independent renewable generators that submitted bids through the company's green request for proposals issued in April 2009. The energy from Superior is helping grow Georgia Power's Green Energy program.
"Landfill gas is a clean energy resource that has been endorsed by the U.S. EPA as an environmentally wise alternative that reduces our reliance on fossil fuels," said Paul Pabor, vice president of Renewable Energy for Waste Management. "Over the years, Waste Management has worked closely with businesses, industries and public utilities to develop many beneficial-use projects. We currently have more than 115 projects across North America, including three other sites in Georgia."
Waste Management tailors its services to meet the needs of each customer group and to ensure consistent, superior service at the local level. Waste Management, based in Houston, Texas, is the leading provider of comprehensive waste management services in North America. Its subsidiaries provide collection, transfer, recycling and resource recovery, and disposal services. It is also a leading developer, operator and owner of landfill gas-to-energy and waste-to-energy facilities in the United States. With nearly 800 employees in Georgia, the company serves residential, commercial, industrial and municipal customers throughout North America.
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The facility is among the largest of its kind in Georgia and the Southeast, according to U.S. Environmental Protection Agency (EPA) data. It represents a new source of green energy entering the power grid, lessening our dependence on fossil fuels. Methane gas -- created from the natural decomposition of waste -- is taken from the landfill through a series of wells placed around the site. From there, gas is used to power eight large engines to generate electricity, creating approximately 6.4 megawatts of power.
"The opening of this facility represents a new source of clean, renewable energy for our community," said Robby White, district manager for Waste Management in Savannah. "It is an environmentally responsible way to harness the energy from the waste we all generate."
Georgia Power and Waste Management Renewable Energy LLC entered into a 10-year deal for electricity, which was approved by the Georgia Public Service Commission in April. Georgia Power selected Waste Management from a number of independent renewable generators that submitted bids through the company's green request for proposals issued in April 2009. The energy from Superior is helping grow Georgia Power's Green Energy program.
"Landfill gas is a clean energy resource that has been endorsed by the U.S. EPA as an environmentally wise alternative that reduces our reliance on fossil fuels," said Paul Pabor, vice president of Renewable Energy for Waste Management. "Over the years, Waste Management has worked closely with businesses, industries and public utilities to develop many beneficial-use projects. We currently have more than 115 projects across North America, including three other sites in Georgia."
Waste Management tailors its services to meet the needs of each customer group and to ensure consistent, superior service at the local level. Waste Management, based in Houston, Texas, is the leading provider of comprehensive waste management services in North America. Its subsidiaries provide collection, transfer, recycling and resource recovery, and disposal services. It is also a leading developer, operator and owner of landfill gas-to-energy and waste-to-energy facilities in the United States. With nearly 800 employees in Georgia, the company serves residential, commercial, industrial and municipal customers throughout North America.
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Friday, May 21, 2010
Chevron Energy Solutions and Marine Corps Logistics Base Albany Announce First Navy Landfill Gas Project
/PRNewswire/ -- Chevron Energy Solutions, a unit of Chevron Corporation (NYSE:CVX) , and the Marine Corps Logistics Base (MCLB) Albany today announced the start of construction for the Department of Navy's first landfill gas cogeneration project.
The project will produce 1.9 megawatts of renewable electric power and steam by burning landfill gas collected from a nearby landfill. Chevron Energy Solutions will also complete industrial lighting retrofits in 82 buildings and expand the existing energy management control system. When combined with the cogeneration project, these measures will reduce the base's purchase of utility power and reduce MCLB's carbon emissions by 19,300 tons annually, equivalent to removing 16,000 cars from the road.
"This project is important to the Department of the Navy, the Marine Corps and Dougherty County. And with the help of Chevron Energy Solutions we will surpass our federal renewal energy goals, and fulfill our aspiration of becoming the 'greenest' Marine Corps installation in the nation," said Col. Terry V. Williams, commanding officer, MCLB Albany. "In addition to providing renewable power and energy security and reliability to MCLB, the project provides a valuable long-term source of revenue for Dougherty County. It took the hard work of many different partners to make this project a reality."
Chevron Energy Solutions developed and designed the project and will maintain the landfill gas-to-energy facility, pipeline and landfill gas processing equipment. The new facility will house a dual-fuel engine generator, a stack heat recovery steam generator and two dual-fuel boilers. The primary equipment can operate on landfill gas or natural gas, which provides energy security benefits. MCLB's use of renewable power will increase to 19 percent, which exceeds the EPAct of 2005 and Energy Independence and Security Act of 2007 mandate of 7.5 percent renewable power use by 2013.
Chevron Energy Solutions and MCLB will share in the operation of the generator and steam-producing equipment. Through an Energy Savings Performance Contract (ESPC), Chevron Energy Solutions arranged the financing for the project, which is repaid through the energy costs avoided. The company also guarantees system performance for 22 years.
"MCLB Albany is harnessing the power of an important renewable energy source through a partnership with the local community and we are proud of this effort," said Jim Davis, president of Chevron Energy Solutions. "The project is funded entirely by energy savings and demonstrates how military bases and local governments can work together with private industry to meet federal mandates without increasing taxpayer costs."
Dougherty County will extract and sell the landfill gas to MCLB from the Fleming/Gaissert Road Landfill, which receives approximately 100,000 tons of municipal solid waste each year. The biological decomposition of the waste generates landfill gas that is approximately 50 percent methane gas by volume.
A groundbreaking ceremony was held today and military, government and business officials attended. The project is expected to be completed by April 2011.
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The project will produce 1.9 megawatts of renewable electric power and steam by burning landfill gas collected from a nearby landfill. Chevron Energy Solutions will also complete industrial lighting retrofits in 82 buildings and expand the existing energy management control system. When combined with the cogeneration project, these measures will reduce the base's purchase of utility power and reduce MCLB's carbon emissions by 19,300 tons annually, equivalent to removing 16,000 cars from the road.
"This project is important to the Department of the Navy, the Marine Corps and Dougherty County. And with the help of Chevron Energy Solutions we will surpass our federal renewal energy goals, and fulfill our aspiration of becoming the 'greenest' Marine Corps installation in the nation," said Col. Terry V. Williams, commanding officer, MCLB Albany. "In addition to providing renewable power and energy security and reliability to MCLB, the project provides a valuable long-term source of revenue for Dougherty County. It took the hard work of many different partners to make this project a reality."
Chevron Energy Solutions developed and designed the project and will maintain the landfill gas-to-energy facility, pipeline and landfill gas processing equipment. The new facility will house a dual-fuel engine generator, a stack heat recovery steam generator and two dual-fuel boilers. The primary equipment can operate on landfill gas or natural gas, which provides energy security benefits. MCLB's use of renewable power will increase to 19 percent, which exceeds the EPAct of 2005 and Energy Independence and Security Act of 2007 mandate of 7.5 percent renewable power use by 2013.
Chevron Energy Solutions and MCLB will share in the operation of the generator and steam-producing equipment. Through an Energy Savings Performance Contract (ESPC), Chevron Energy Solutions arranged the financing for the project, which is repaid through the energy costs avoided. The company also guarantees system performance for 22 years.
"MCLB Albany is harnessing the power of an important renewable energy source through a partnership with the local community and we are proud of this effort," said Jim Davis, president of Chevron Energy Solutions. "The project is funded entirely by energy savings and demonstrates how military bases and local governments can work together with private industry to meet federal mandates without increasing taxpayer costs."
Dougherty County will extract and sell the landfill gas to MCLB from the Fleming/Gaissert Road Landfill, which receives approximately 100,000 tons of municipal solid waste each year. The biological decomposition of the waste generates landfill gas that is approximately 50 percent methane gas by volume.
A groundbreaking ceremony was held today and military, government and business officials attended. The project is expected to be completed by April 2011.
-----
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Wednesday, May 12, 2010
Price Carbon Campaign: Kerry-Lieberman Bill Is No Match for Climate Challenge
/PRNewswire/ -- While senators John Kerry (D-MA) and Joe Lieberman (I-CT) should be commended for their tireless efforts on climate and energy legislation, several flaws in their proposal will prevent it from reducing carbon dioxide to levels that are safe and sustainable, the Price Carbon Campaign said in a statement today.
"The Kerry-Lieberman bill fails the acid test of climate legislation, which is to provide clear signals on emission prices. Investors, entrepreneurs and households all need certainty in future fuel and energy prices, but Kerry-Lieberman hides these crucial price signals behind a curtain of cap-and-trade," said economist Charles Komanoff, co-founder of the Carbon Tax Center, one of the campaign members.
The Kerry-Lieberman bill also allows polluters to purchase carbon offsets, which will delay by precious decades America's transition to clean energy, the campaign said.
"Instead of making needed investments in renewable energy, utilities will have the much cheaper option of investing in third-world projects aimed at cutting carbon," said Tom Stokes, Coordinator of the Climate Crisis Coalition. "Most of these offsets do nothing to reduce current emissions, and they allow polluters in the U.S. to keep burning coal and other dirty fuels."
The campaign also said the Kerry-Lieberman bill fails to adequately protect American households from rising energy costs.
"We need to cut CO2, but we shouldn't stick hard-working families with the bill," said Marshall Saunders, Founder and President of Citizens Climate Lobby, another campaign member. "We believe all the revenue derived from pricing carbon should be returned to everyone, either through direct payment or payroll tax reductions."
The Price Carbon Campaign supports the "People's Climate Stewardship Act," introduced by Dr. James Hansen at the Climate Rally in Washington, DC, on April 25. Rep. John Larson (D-CT) and Bob Inglis (R-SC) have each introduced bills based on the same paramount principles: steadily-increasing carbon fees and recycling the revenue back to the American people.
The Price Carbon Campaign includes Climate Crisis Coalition, Carbon Tax Center and Citizens Climate Lobby.
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"The Kerry-Lieberman bill fails the acid test of climate legislation, which is to provide clear signals on emission prices. Investors, entrepreneurs and households all need certainty in future fuel and energy prices, but Kerry-Lieberman hides these crucial price signals behind a curtain of cap-and-trade," said economist Charles Komanoff, co-founder of the Carbon Tax Center, one of the campaign members.
The Kerry-Lieberman bill also allows polluters to purchase carbon offsets, which will delay by precious decades America's transition to clean energy, the campaign said.
"Instead of making needed investments in renewable energy, utilities will have the much cheaper option of investing in third-world projects aimed at cutting carbon," said Tom Stokes, Coordinator of the Climate Crisis Coalition. "Most of these offsets do nothing to reduce current emissions, and they allow polluters in the U.S. to keep burning coal and other dirty fuels."
The campaign also said the Kerry-Lieberman bill fails to adequately protect American households from rising energy costs.
"We need to cut CO2, but we shouldn't stick hard-working families with the bill," said Marshall Saunders, Founder and President of Citizens Climate Lobby, another campaign member. "We believe all the revenue derived from pricing carbon should be returned to everyone, either through direct payment or payroll tax reductions."
The Price Carbon Campaign supports the "People's Climate Stewardship Act," introduced by Dr. James Hansen at the Climate Rally in Washington, DC, on April 25. Rep. John Larson (D-CT) and Bob Inglis (R-SC) have each introduced bills based on the same paramount principles: steadily-increasing carbon fees and recycling the revenue back to the American people.
The Price Carbon Campaign includes Climate Crisis Coalition, Carbon Tax Center and Citizens Climate Lobby.
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Friday, May 7, 2010
Groups: Negative Court Ruling in Georgia Throws DOE's Nuclear Loan Guarantee Bailout Program Into Question
/PRNewswire/ -- The only taxpayer-backed loan guarantee bailout to be offered for new nuclear reactors - $8.3 billion for two reactors at Plant Vogtle in Georgia - should be rescinded now that the project was dealt a setback in a decision by a Georgia judge that state officials illegally certified the project, according to the Southern Alliance for Clean Energy (SACE) and Public Citizen.
The groups also noted that, despite the push in Congress for more controversial loan guarantees for new nuclear reactors, the other two leading contenders for such bailouts - the South Texas Project at Bay City on the Gulf Coast (114 miles from San Antonio and 90 miles from Houston) and Calvert Cliffs in Maryland - are more unsettled than ever and now pose an even greater risk to U.S. taxpayers.
As such, the groups also said that Department of Energy (DOE) should refrain from offering any new loan guarantees to nuclear projects before overhauling its evaluation process.
DOE has stated that the $10 billion remaining in loan guarantee authority is only sufficient for one of the two projects and has requested another $9 billion in the appropriations supplemental to cover the second project. In its FY2011 budget request, the Obama Administration has already requested $36 billion in loan guarantee authority, a tripling of the nuclear loan guarantee program.
The groups detailed the setbacks at the Georgia project and other two federal bailout candidates as follows:
VOGTLE
Last Friday, the Southern Alliance for Clean Energy won its lawsuit in Fulton County Superior Court that aimed to protect Georgians from unfair utility costs in connection with the proposed construction of two new nuclear reactors at Vogtle near Waynesboro, Georgia. The Court found that the Georgia Public Service Commission acted illegally in violation of Georgia state law. The Commission's approval last year during the certification process for the proposed new Vogtle reactors was put into question.
At Friday's hearing, Judge Wendy Shoob heard SACE's allegation that the Georgia Public Service Commission (PSC) erred as a matter of law by failing to make findings of fact and conclusions of law as required. Specifically, the group alleged that the PSC did not provide the required written justifications for its findings that would "afford an intelligent review" by the courts. The PSC instead relied on statements void of any reasoning. The Court ruled in favor of SACE and found that the PSC acted illegally in violation of Georgia state law by failing to make all appropriate findings and to support those findings with a concise and explicit statement of the facts. Just prior to the decision, Southern Company had yet to accept the conditional guarantee and had requested another month to decide. On Wednesday, the Court issued the final order, remanding the case back to the PSC. (See http://www.cleanenergy.org/images/testimony/FinalOrderPetitionforJudicialRevie w050510.pdf for more information.)
Stephen Smith, executive director of the Southern Alliance for Clean Energy, said: "This ruling raises further concerns over the Obama Administration's controversial decision in February to award an $8.3 billion taxpayer-financed conditional loan guarantee for Southern Company's proposed Vogtle project, the first to be offered one in the country. Given this decision and the economic risks to U.S. taxpayers of this project, DOE should rescind its offer of a loan guarantee. DOE needs to re-evaluate its 'due-diligence' procedures before offering any other loan guarantees. For example, how can a loan guarantee be offered before a reactor design is even certified as safe by the Nuclear Regulatory Commission?"
SOUTH TEXAS PROJECT
The estimated cost for two NRG proposed reactors in Texas has risen from $5.8 billion in 2006 to a reported $18.2 billion at the end of 2009. As a result, the City of San Antonio pulled out of 85 percent of its investment in the project, leaving a void of as much as 33 percent of the project without investors.
Karen Hadden, executive director of the Sustainable Energy and Economic Development (SEED) coalition, said: "The South Texas nuclear reactor is an economic disaster waiting to happen. The costs have trebled since the plant was proposed, NRG's credit is just one notch above a junk bond rating, NRG's partner sued them for fraud and no one wants to buy shares due to the fast-rising costs. The federal government may foolishly put taxpayer money behind the South Texas Project, but it can't force anyone to buy the resulting overpriced power. Since Texas is deregulated, this plant will have to sell excess energy into the market. Expensive nuclear power must compete against cheaper and plentiful efficiency, wind and natural gas. As a result, the power it produces won't be too cheap to meter -- instead it will be too expensive to sell. If we give this turkey loan guarantees -- taxpayers will get stuck with the bill."
CALVERT CLIFFS
In 2007, the cost estimate for the proposed new reactor at Calvert Cliffs was $5 billion. Since then, UniStar has been reluctant to provide any public cost estimates for construction of the proposed Calvert Cliffs-3 reactor, but in August 2008 hearings before the Maryland Public Service Commission, CEO George Vanderheyden acknowledged that the company's estimates are on the "upper end" of the $4,500 - $6,000 per kilowatt (kWh) level. For a 1600 megawatt reactor such as Calvert Cliffs-3, that would mean construction costs of about $9.6 billion. Even that high figure is likely to be low, since the Pennsylvania utility PPL has posted an estimate of $13-15 billion for precisely the same reactor design at Bell Bend in PA.
Additionally, the original drive for Calvert Cliffs preceded the recent decline in demand for power in the region. Power purchase agreements have yet to be established for Calvert Cliffs. Though "demand for power" does not need to be demonstrated by the reactor owner, demand for power in the region has dropped off due to the market downturn, obviating most or all of the need for Calvert Cliffs.
Allison Fisher, organizer for Public Citizen's Energy Program, Public Citizen said: "Taxpayers should be outraged that they are being put on the hook for a reactor design that has been plagued with huge delays and cost overrun. The same reactor is currently under construction in Finland and France. Both projects have been plagued with delays and cost overruns. The Finnish project is three and a half years behind schedule with a 75 percent cost overrun thus far."
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The groups also noted that, despite the push in Congress for more controversial loan guarantees for new nuclear reactors, the other two leading contenders for such bailouts - the South Texas Project at Bay City on the Gulf Coast (114 miles from San Antonio and 90 miles from Houston) and Calvert Cliffs in Maryland - are more unsettled than ever and now pose an even greater risk to U.S. taxpayers.
As such, the groups also said that Department of Energy (DOE) should refrain from offering any new loan guarantees to nuclear projects before overhauling its evaluation process.
DOE has stated that the $10 billion remaining in loan guarantee authority is only sufficient for one of the two projects and has requested another $9 billion in the appropriations supplemental to cover the second project. In its FY2011 budget request, the Obama Administration has already requested $36 billion in loan guarantee authority, a tripling of the nuclear loan guarantee program.
The groups detailed the setbacks at the Georgia project and other two federal bailout candidates as follows:
VOGTLE
Last Friday, the Southern Alliance for Clean Energy won its lawsuit in Fulton County Superior Court that aimed to protect Georgians from unfair utility costs in connection with the proposed construction of two new nuclear reactors at Vogtle near Waynesboro, Georgia. The Court found that the Georgia Public Service Commission acted illegally in violation of Georgia state law. The Commission's approval last year during the certification process for the proposed new Vogtle reactors was put into question.
At Friday's hearing, Judge Wendy Shoob heard SACE's allegation that the Georgia Public Service Commission (PSC) erred as a matter of law by failing to make findings of fact and conclusions of law as required. Specifically, the group alleged that the PSC did not provide the required written justifications for its findings that would "afford an intelligent review" by the courts. The PSC instead relied on statements void of any reasoning. The Court ruled in favor of SACE and found that the PSC acted illegally in violation of Georgia state law by failing to make all appropriate findings and to support those findings with a concise and explicit statement of the facts. Just prior to the decision, Southern Company had yet to accept the conditional guarantee and had requested another month to decide. On Wednesday, the Court issued the final order, remanding the case back to the PSC. (See http://www.cleanenergy.org/images/testimony/FinalOrderPetitionforJudicialRevie w050510.pdf for more information.)
Stephen Smith, executive director of the Southern Alliance for Clean Energy, said: "This ruling raises further concerns over the Obama Administration's controversial decision in February to award an $8.3 billion taxpayer-financed conditional loan guarantee for Southern Company's proposed Vogtle project, the first to be offered one in the country. Given this decision and the economic risks to U.S. taxpayers of this project, DOE should rescind its offer of a loan guarantee. DOE needs to re-evaluate its 'due-diligence' procedures before offering any other loan guarantees. For example, how can a loan guarantee be offered before a reactor design is even certified as safe by the Nuclear Regulatory Commission?"
SOUTH TEXAS PROJECT
The estimated cost for two NRG proposed reactors in Texas has risen from $5.8 billion in 2006 to a reported $18.2 billion at the end of 2009. As a result, the City of San Antonio pulled out of 85 percent of its investment in the project, leaving a void of as much as 33 percent of the project without investors.
Karen Hadden, executive director of the Sustainable Energy and Economic Development (SEED) coalition, said: "The South Texas nuclear reactor is an economic disaster waiting to happen. The costs have trebled since the plant was proposed, NRG's credit is just one notch above a junk bond rating, NRG's partner sued them for fraud and no one wants to buy shares due to the fast-rising costs. The federal government may foolishly put taxpayer money behind the South Texas Project, but it can't force anyone to buy the resulting overpriced power. Since Texas is deregulated, this plant will have to sell excess energy into the market. Expensive nuclear power must compete against cheaper and plentiful efficiency, wind and natural gas. As a result, the power it produces won't be too cheap to meter -- instead it will be too expensive to sell. If we give this turkey loan guarantees -- taxpayers will get stuck with the bill."
CALVERT CLIFFS
In 2007, the cost estimate for the proposed new reactor at Calvert Cliffs was $5 billion. Since then, UniStar has been reluctant to provide any public cost estimates for construction of the proposed Calvert Cliffs-3 reactor, but in August 2008 hearings before the Maryland Public Service Commission, CEO George Vanderheyden acknowledged that the company's estimates are on the "upper end" of the $4,500 - $6,000 per kilowatt (kWh) level. For a 1600 megawatt reactor such as Calvert Cliffs-3, that would mean construction costs of about $9.6 billion. Even that high figure is likely to be low, since the Pennsylvania utility PPL has posted an estimate of $13-15 billion for precisely the same reactor design at Bell Bend in PA.
Additionally, the original drive for Calvert Cliffs preceded the recent decline in demand for power in the region. Power purchase agreements have yet to be established for Calvert Cliffs. Though "demand for power" does not need to be demonstrated by the reactor owner, demand for power in the region has dropped off due to the market downturn, obviating most or all of the need for Calvert Cliffs.
Allison Fisher, organizer for Public Citizen's Energy Program, Public Citizen said: "Taxpayers should be outraged that they are being put on the hook for a reactor design that has been plagued with huge delays and cost overrun. The same reactor is currently under construction in Finland and France. Both projects have been plagued with delays and cost overruns. The Finnish project is three and a half years behind schedule with a 75 percent cost overrun thus far."
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Monday, May 3, 2010
Atlanta Gas Light Files First Rate Case in Five Years
/PRNewswire/ -- Facing higher operating expenses and declining revenue in a stubborn economy, Atlanta Gas Light today filed an application with the Georgia Public Service Commission (PSC) requesting a monthly increase in base rates of $2.95 for residential customers.
In its first rate case filing in more than five years, Atlanta Gas Light attributes the primary need for the increase to higher compliance and operating costs, including employee expenses and declining customer growth. If granted, it would be the first base rate increase for Atlanta Gas Light since 1993. Revenues from base rates are what the utility uses to provide its core services. Even with the proposed increase, company forecasts indicate revenues collected from customers in 2010-2011 would be lower than the company received in 2005.
For the first time in company history, Atlanta Gas Light has lost more customers than it has added for two consecutive years. In 2009 alone, Atlanta Gas Light experienced a net loss of over 8,000 customers from the system. The impact of a slower rate of new customer additions and higher customer attrition means the fixed costs of the utility are spread over fewer customers, which contributes to the upward pressure on rates.
"Over the past five years, we have taken aggressive steps to control costs and manage our utility expenses," said Suzanne Sitherwood, president, Atlanta Gas Light. "This rate adjustment is necessary to maintain appropriate service levels, to invest in vital programs that will make us more efficient, and to improve our ability to meet our customer needs. We deferred this necessary step as long as we could."
A portion of the increase would support Atlanta Gas Light's ongoing five-year business plan presented in the application. Called "Customer First," the plan includes customer service initiatives such as:
-- Automated Meter Reading Technology, which will equip radio technology
to hundreds of thousands of meters and is expected to improve
efficiency and accuracy and provide real-time consumption data;
-- Re-establishing the Customer Call Center in Atlanta, bringing
approximately 74 jobs to Riverdale, Ga., to better handle customer
care;
-- Improved Technology Systems, intended to provide quicker response
times for marketer and customer services and improved web features for
customer scheduling and personal consumption statistics;
-- Service Call Courtesies and Repair/Replace Vouchers, enabling utility
technicians during service calls to perform minor repairs or leave
behind repair or replacement vouchers for ENERGY STAR appliances. This
program is expected to help avoid service interruption, improve safety
and retain customers on the natural gas system, which keeps costs down
for all ratepayers; and
-- Increased Service Availability, intended to improve response time and
shorten customer wait time for the company to complete orders.
Atlanta Gas Light has included a proposal expected to help hold down future operating expenses by adopting a policy to require the company to share 50 percent of the cost savings resulting from future acquisitions with Atlanta Gas Light customers through lower operating expenses. Two recent acquisitions in Virginia and New Jersey have produced more than $100 million in cost savings since 2005, benefiting residential and commercial Atlanta Gas Light customers.
"A formal policy requiring that Atlanta Gas Light customers receive fifty percent of the cost savings from future acquisitions is the right thing to do," said Hank Linginfelter, executive vice president, AGL Resources. "We have reduced overall corporate service expenses shouldered by Atlanta Gas Light's customers from 90 percent to 48 percent through our most recent transactions, and we are now able to provide shared corporate services at one of the lowest rates in the country among major gas utilities."
The company's rate proposal is expected to increase the average annual residential natural gas bill by about 3 percent. If granted, the new rates would be expected to generate about $54 million annually. The new revenue would support ongoing operations and reset the company's return on equity ($18.5 million), fund new customer service initiatives ($13.4 million), collect a portion of savings from mergers benefiting Atlanta Gas Light customers ($14.5 million), and restructure depreciation expenses ($7.7 million). The changes would go into effect in November 2010 and would be reflected in Atlanta Gas Light's base rate charge assessed to customers by their certificated gas marketer.
The PSC will hold public hearings on the company's application beginning in August and will evaluate the case under its legal obligation to balance the need for the consumer to receive reliable services at reasonable rates with the need to provide the utility with the opportunity to earn a reasonable return on its investment.
About Atlanta Gas Light
Atlanta Gas Light, a wholly owned subsidiary of AGL Resources (NYSE:AGL) , provides natural gas delivery service to more than 1.5 million customers in Georgia. In operation since 1856, the company is one of the oldest corporations in the state. For more information, visit www.atlantagaslight.com.
About AGL Resources
AGL Resources (NYSE:AGL) , an Atlanta-based energy services company, serves approximately 2.3 million customers in six states. The company also owns Houston-based Sequent Energy Management, an asset manager serving natural gas wholesale customers throughout North America. As an 85-percent owner in the SouthStar partnership, AGL Resources markets natural gas to consumers in Georgia under the Georgia Natural Gas brand. The company also owns and operates Jefferson Island Storage & Hub, a high-deliverability natural gas storage facility near the Henry Hub in Louisiana. For more information, visit www.aglresources.com.
Forward-Looking Statements
Certain expectations and projections regarding our future performance referenced in this press release are forward-looking statements. Forward - looking statements involve matters that are not historical facts and because these statements involve anticipated events or conditions, forward-looking statements often include words such as "anticipate," "assume," "believe," "can," "could," "estimate," "expect," "forecast," "future," "goal," "indicate," "intend," "may," "outlook," "plan," "potential," "predict," "project," "seek," "should," "target," "would," or similar expressions. Forward-looking statements in this press release include, without limitation, the expected revenues to be collected from Atlanta Gas Light customers in 2010-2011; including the underlying components , such as forecasted declining revenues, higher operating expenses and the sharing of cost savings from future acquisitions, driving the proposed higher base rates \, and the projected operational, customer and other benefits from the results of the "Customer First" five-year business plan and related initiatives; and future operating expenses related to future acquisitions.
Our expectations are not guarantees and are based on currently available competitive, financial and economic data along with our operating plans. While we believe our expectations are reasonable in view of the currently available information, our expectations are subject to future events, risks and uncertainties, and there are several factors - many beyond our control - that could cause results to differ significantly from our expectations.
Such events, risks and uncertainties include, but are not limited to, changes in price, supply and demand for natural gas and related products; the impact of changes in state and federal legislation and regulation including changes related to climate change; actions taken by government agencies on rates and other matters; utility and energy industry consolidation; the impact on cost and timeliness of construction projects by government and other approvals, development project delays, adequacy of supply of diversified vendors, and unexpected change in project costs, including the cost of funds to finance these projects; direct or indirect effects on our business, financial condition or liquidity resulting from a change in our credit ratings or the credit ratings of our counterparties or competitors; interest rate fluctuations; financial market conditions, including recent disruptions in the capital markets and lending environment and the current economic downturn; the impact of natural disasters such as hurricanes on the supply and price of natural gas; acts of war or terrorism; and other factors which are described in detail in our filings with the Securities and Exchange Commission, which we incorporate by reference in this press release. Forward-looking statements are only as of the date they are made, and we do not undertake to update these statements to reflect subsequent changes.
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In its first rate case filing in more than five years, Atlanta Gas Light attributes the primary need for the increase to higher compliance and operating costs, including employee expenses and declining customer growth. If granted, it would be the first base rate increase for Atlanta Gas Light since 1993. Revenues from base rates are what the utility uses to provide its core services. Even with the proposed increase, company forecasts indicate revenues collected from customers in 2010-2011 would be lower than the company received in 2005.
For the first time in company history, Atlanta Gas Light has lost more customers than it has added for two consecutive years. In 2009 alone, Atlanta Gas Light experienced a net loss of over 8,000 customers from the system. The impact of a slower rate of new customer additions and higher customer attrition means the fixed costs of the utility are spread over fewer customers, which contributes to the upward pressure on rates.
"Over the past five years, we have taken aggressive steps to control costs and manage our utility expenses," said Suzanne Sitherwood, president, Atlanta Gas Light. "This rate adjustment is necessary to maintain appropriate service levels, to invest in vital programs that will make us more efficient, and to improve our ability to meet our customer needs. We deferred this necessary step as long as we could."
A portion of the increase would support Atlanta Gas Light's ongoing five-year business plan presented in the application. Called "Customer First," the plan includes customer service initiatives such as:
-- Automated Meter Reading Technology, which will equip radio technology
to hundreds of thousands of meters and is expected to improve
efficiency and accuracy and provide real-time consumption data;
-- Re-establishing the Customer Call Center in Atlanta, bringing
approximately 74 jobs to Riverdale, Ga., to better handle customer
care;
-- Improved Technology Systems, intended to provide quicker response
times for marketer and customer services and improved web features for
customer scheduling and personal consumption statistics;
-- Service Call Courtesies and Repair/Replace Vouchers, enabling utility
technicians during service calls to perform minor repairs or leave
behind repair or replacement vouchers for ENERGY STAR appliances. This
program is expected to help avoid service interruption, improve safety
and retain customers on the natural gas system, which keeps costs down
for all ratepayers; and
-- Increased Service Availability, intended to improve response time and
shorten customer wait time for the company to complete orders.
Atlanta Gas Light has included a proposal expected to help hold down future operating expenses by adopting a policy to require the company to share 50 percent of the cost savings resulting from future acquisitions with Atlanta Gas Light customers through lower operating expenses. Two recent acquisitions in Virginia and New Jersey have produced more than $100 million in cost savings since 2005, benefiting residential and commercial Atlanta Gas Light customers.
"A formal policy requiring that Atlanta Gas Light customers receive fifty percent of the cost savings from future acquisitions is the right thing to do," said Hank Linginfelter, executive vice president, AGL Resources. "We have reduced overall corporate service expenses shouldered by Atlanta Gas Light's customers from 90 percent to 48 percent through our most recent transactions, and we are now able to provide shared corporate services at one of the lowest rates in the country among major gas utilities."
The company's rate proposal is expected to increase the average annual residential natural gas bill by about 3 percent. If granted, the new rates would be expected to generate about $54 million annually. The new revenue would support ongoing operations and reset the company's return on equity ($18.5 million), fund new customer service initiatives ($13.4 million), collect a portion of savings from mergers benefiting Atlanta Gas Light customers ($14.5 million), and restructure depreciation expenses ($7.7 million). The changes would go into effect in November 2010 and would be reflected in Atlanta Gas Light's base rate charge assessed to customers by their certificated gas marketer.
The PSC will hold public hearings on the company's application beginning in August and will evaluate the case under its legal obligation to balance the need for the consumer to receive reliable services at reasonable rates with the need to provide the utility with the opportunity to earn a reasonable return on its investment.
About Atlanta Gas Light
Atlanta Gas Light, a wholly owned subsidiary of AGL Resources (NYSE:AGL) , provides natural gas delivery service to more than 1.5 million customers in Georgia. In operation since 1856, the company is one of the oldest corporations in the state. For more information, visit www.atlantagaslight.com.
About AGL Resources
AGL Resources (NYSE:AGL) , an Atlanta-based energy services company, serves approximately 2.3 million customers in six states. The company also owns Houston-based Sequent Energy Management, an asset manager serving natural gas wholesale customers throughout North America. As an 85-percent owner in the SouthStar partnership, AGL Resources markets natural gas to consumers in Georgia under the Georgia Natural Gas brand. The company also owns and operates Jefferson Island Storage & Hub, a high-deliverability natural gas storage facility near the Henry Hub in Louisiana. For more information, visit www.aglresources.com.
Forward-Looking Statements
Certain expectations and projections regarding our future performance referenced in this press release are forward-looking statements. Forward - looking statements involve matters that are not historical facts and because these statements involve anticipated events or conditions, forward-looking statements often include words such as "anticipate," "assume," "believe," "can," "could," "estimate," "expect," "forecast," "future," "goal," "indicate," "intend," "may," "outlook," "plan," "potential," "predict," "project," "seek," "should," "target," "would," or similar expressions. Forward-looking statements in this press release include, without limitation, the expected revenues to be collected from Atlanta Gas Light customers in 2010-2011; including the underlying components , such as forecasted declining revenues, higher operating expenses and the sharing of cost savings from future acquisitions, driving the proposed higher base rates \, and the projected operational, customer and other benefits from the results of the "Customer First" five-year business plan and related initiatives; and future operating expenses related to future acquisitions.
Our expectations are not guarantees and are based on currently available competitive, financial and economic data along with our operating plans. While we believe our expectations are reasonable in view of the currently available information, our expectations are subject to future events, risks and uncertainties, and there are several factors - many beyond our control - that could cause results to differ significantly from our expectations.
Such events, risks and uncertainties include, but are not limited to, changes in price, supply and demand for natural gas and related products; the impact of changes in state and federal legislation and regulation including changes related to climate change; actions taken by government agencies on rates and other matters; utility and energy industry consolidation; the impact on cost and timeliness of construction projects by government and other approvals, development project delays, adequacy of supply of diversified vendors, and unexpected change in project costs, including the cost of funds to finance these projects; direct or indirect effects on our business, financial condition or liquidity resulting from a change in our credit ratings or the credit ratings of our counterparties or competitors; interest rate fluctuations; financial market conditions, including recent disruptions in the capital markets and lending environment and the current economic downturn; the impact of natural disasters such as hurricanes on the supply and price of natural gas; acts of war or terrorism; and other factors which are described in detail in our filings with the Securities and Exchange Commission, which we incorporate by reference in this press release. Forward-looking statements are only as of the date they are made, and we do not undertake to update these statements to reflect subsequent changes.
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Wednesday, April 28, 2010
America's Anemic '13 Percent Economy': Experts Warn U.S. Risks Long-Term Growth by Focusing on New Energy at Expense of More Energy Efficiency
/PRNewswire/ -- What will play the biggest role in future U.S. economic growth: the new energy that we find ... or the energy that we avoid using?
Even as Congress and the news media focus almost completely on the question of where America will find new sources of traditional and emerging energy sources, the little-understood fact is that new energy sources are likely to play a much smaller role in the current U.S. economic recovery and future growth than are new advances in energy efficiency, according to leading experts. Even worse, the overwhelming emphasis today on new energy is "crowding out" meaningful national dialogue and progress on achieving greater energy efficiency in an economy that is struggling today at a level of just 13 percent efficiency in terms of energy use, meaning that 87% of the energy we use is wasted.
In a phone-based news conference today - John A. "Skip" Laitner, director, Economic and Social Analysis, American Council for an Energy-Efficient Economy and Robert U. Ayres, emeritus professor, Economics and Political Science and Technology Management, European Institute of Business Administration (INSEAD), and co-author of "Crossing the Energy Divide: Moving from Fossil Fuel Dependence to a Clean-Energy Future" (2010) - summarized the thinking at a symposium session held Tuesday to mark the 30th anniversary year of the American Council for an Energy-Efficient Economy (ACEEE). See http://www.aceee.org/conf/30th/april26.htm for more information.
Among the key facts highlighted during the symposium:
-- America's economy has tripled in size since 1970 and three-quarters of
the energy needed to fuel that growth came from efficiency advances -
not net new energy. Going forward, the current economic recovery and
future economic growth are likely to be even more dependent on new
energy efficiency advances than was the period of 1970-date.
-- Americans may have an overly optimistic impression of how energy
efficient the United States is. Despite the enormous strides achieved
in the last four decades, the U.S. economy remains only about 13
percent energy efficient. That still unacceptably high level of
inefficiency either will be allowed to remain in place and therefore
leave the U.S. mired in lackluster economic activity ... or it will be
tackled head-on, leading to new efficiency advances and unleashing
robust future economic growth in the U.S. For example, Japan and
several European countries are about 20% efficient, a factor of 1.5
higher than the U.S.
-- How big might the next round of potential energy efficiency be? If we
invested in more energy productive technologies, energy efficiency
investments can provide up to one-half of the needed greenhouses gas
emissions reductions most scientists say are needed between now and
the year 2050. And that gain in energy efficiency would not only mean
reduced greenhouse gas emissions, it would result in lower energy bill
for consumers.
ACEEE's Laitner said: "The dirty little secret today is that most economic assessments of the current climate change policies either ignore or greatly understate the potential advances in energy efficiency, even though it is clearly the largest and most cost-effective form of greenhouse gas mitigation. There is no mistaking the fact the cheapest, least polluting and most economically productive energy is the energy that never gets used. Cost-effective investment that can reduce the amount of energy necessary to support a dollar of economic activity is the single most important driver of economic productivity within the United States and around the world. And this makes sense once we stop paying attention to outdated economic policy models and think about what is it that actually powers our economy. Is it expensive and conventional energy resources, or the increased use of more energy productive technologies? The evidence suggests that it is the latter. We ignore that at our considerable peril."
Ayres said: "The greatest barrier of all to more energy efficiency is the mentality of the growth imperative: the deep-seated conviction that growth assures survival in the competitive global race. The focus is on growth, with profits secondary. But we have to ask: The race is to where? Growth that consumes limited resources is itself unsustainable. A new paradigm is urgently needed. The new paradigm must focus on the cost-effective re-use, renovation, remanufacturing and recycling. The energy firms of the future will need to sell efficiency, and energy security, not fuel."
-----
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Even as Congress and the news media focus almost completely on the question of where America will find new sources of traditional and emerging energy sources, the little-understood fact is that new energy sources are likely to play a much smaller role in the current U.S. economic recovery and future growth than are new advances in energy efficiency, according to leading experts. Even worse, the overwhelming emphasis today on new energy is "crowding out" meaningful national dialogue and progress on achieving greater energy efficiency in an economy that is struggling today at a level of just 13 percent efficiency in terms of energy use, meaning that 87% of the energy we use is wasted.
In a phone-based news conference today - John A. "Skip" Laitner, director, Economic and Social Analysis, American Council for an Energy-Efficient Economy and Robert U. Ayres, emeritus professor, Economics and Political Science and Technology Management, European Institute of Business Administration (INSEAD), and co-author of "Crossing the Energy Divide: Moving from Fossil Fuel Dependence to a Clean-Energy Future" (2010) - summarized the thinking at a symposium session held Tuesday to mark the 30th anniversary year of the American Council for an Energy-Efficient Economy (ACEEE). See http://www.aceee.org/conf/30th/april26.htm for more information.
Among the key facts highlighted during the symposium:
-- America's economy has tripled in size since 1970 and three-quarters of
the energy needed to fuel that growth came from efficiency advances -
not net new energy. Going forward, the current economic recovery and
future economic growth are likely to be even more dependent on new
energy efficiency advances than was the period of 1970-date.
-- Americans may have an overly optimistic impression of how energy
efficient the United States is. Despite the enormous strides achieved
in the last four decades, the U.S. economy remains only about 13
percent energy efficient. That still unacceptably high level of
inefficiency either will be allowed to remain in place and therefore
leave the U.S. mired in lackluster economic activity ... or it will be
tackled head-on, leading to new efficiency advances and unleashing
robust future economic growth in the U.S. For example, Japan and
several European countries are about 20% efficient, a factor of 1.5
higher than the U.S.
-- How big might the next round of potential energy efficiency be? If we
invested in more energy productive technologies, energy efficiency
investments can provide up to one-half of the needed greenhouses gas
emissions reductions most scientists say are needed between now and
the year 2050. And that gain in energy efficiency would not only mean
reduced greenhouse gas emissions, it would result in lower energy bill
for consumers.
ACEEE's Laitner said: "The dirty little secret today is that most economic assessments of the current climate change policies either ignore or greatly understate the potential advances in energy efficiency, even though it is clearly the largest and most cost-effective form of greenhouse gas mitigation. There is no mistaking the fact the cheapest, least polluting and most economically productive energy is the energy that never gets used. Cost-effective investment that can reduce the amount of energy necessary to support a dollar of economic activity is the single most important driver of economic productivity within the United States and around the world. And this makes sense once we stop paying attention to outdated economic policy models and think about what is it that actually powers our economy. Is it expensive and conventional energy resources, or the increased use of more energy productive technologies? The evidence suggests that it is the latter. We ignore that at our considerable peril."
Ayres said: "The greatest barrier of all to more energy efficiency is the mentality of the growth imperative: the deep-seated conviction that growth assures survival in the competitive global race. The focus is on growth, with profits secondary. But we have to ask: The race is to where? Growth that consumes limited resources is itself unsustainable. A new paradigm is urgently needed. The new paradigm must focus on the cost-effective re-use, renovation, remanufacturing and recycling. The energy firms of the future will need to sell efficiency, and energy security, not fuel."
-----
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Fayette Front Page
www.georgiafrontpage.com
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Georgia Power's Green Energy Program Redesigned to Include More Solar Power
/PRNewswire/ -- Georgia Power received approval April 20 from the Georgia Public Service Commission (PSC) to modify its Green Energy program, giving customers more solar options.
At the request of PSC Commission Chair Lauren "Bubba" McDonald, the program has been redesigned to include the following:
Premium Green Energy - This option will now contain 50 percent solar energy at a cost of $5 per 100-kilowatt-hour (kWh) block. The option previously cost $4.50 per 100 kWh block and contained 10 percent solar energy.
Under the revised program, the Standard Green Energy, Large Volume Purchase and Special Events Purchase options remain unchanged.
In addition to these changes, the PSC also approved Georgia Power raising the solar capacity cap under its Renewable Non Renewable (RNR) tariff from 1.5 megawatts (MW) to 2.5 MW. The company will now purchase solar energy from customers through this tariff at a new price of 17 cents per kWh.
Georgia Power and the Commission worked together to develop a new mechanism that will automatically raise the solar capacity cap as participation in the Green Energy program grows. Under this mechanism, for every 219 blocks of Premium Green Energy that are purchased by customers, Georgia Power will purchase an additional 100 kW of solar energy through the RNR tariff.
"With the latest changes in our Green Energy program we hope to make solar energy more attractive to our customers," said Angela Strickland, Georgia Power's director of Energy Efficiency and Conservation. "The new mechanism we've developed will ensure that we're keeping pace with customer demand for solar in a cost-effective manner."
Electricity generated for the Green Energy program helps grow the renewable resource base in Georgia and the Southeast and expand the market for renewable energy credits (RECs). RECs are created when a renewable energy facility generates electricity or uses renewable fuel. Customers who purchase RECs through the Green Energy program are paying for the benefit of displacing other non-renewable sources from the electric grid.
Changes to Georgia Power's redesigned Green Energy program and RNR tariff will go into effect June 1, 2010.
For more information or to sign up for Green Energy, visit www.georgiapower.com/green.
-----
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At the request of PSC Commission Chair Lauren "Bubba" McDonald, the program has been redesigned to include the following:
Premium Green Energy - This option will now contain 50 percent solar energy at a cost of $5 per 100-kilowatt-hour (kWh) block. The option previously cost $4.50 per 100 kWh block and contained 10 percent solar energy.
Under the revised program, the Standard Green Energy, Large Volume Purchase and Special Events Purchase options remain unchanged.
In addition to these changes, the PSC also approved Georgia Power raising the solar capacity cap under its Renewable Non Renewable (RNR) tariff from 1.5 megawatts (MW) to 2.5 MW. The company will now purchase solar energy from customers through this tariff at a new price of 17 cents per kWh.
Georgia Power and the Commission worked together to develop a new mechanism that will automatically raise the solar capacity cap as participation in the Green Energy program grows. Under this mechanism, for every 219 blocks of Premium Green Energy that are purchased by customers, Georgia Power will purchase an additional 100 kW of solar energy through the RNR tariff.
"With the latest changes in our Green Energy program we hope to make solar energy more attractive to our customers," said Angela Strickland, Georgia Power's director of Energy Efficiency and Conservation. "The new mechanism we've developed will ensure that we're keeping pace with customer demand for solar in a cost-effective manner."
Electricity generated for the Green Energy program helps grow the renewable resource base in Georgia and the Southeast and expand the market for renewable energy credits (RECs). RECs are created when a renewable energy facility generates electricity or uses renewable fuel. Customers who purchase RECs through the Green Energy program are paying for the benefit of displacing other non-renewable sources from the electric grid.
Changes to Georgia Power's redesigned Green Energy program and RNR tariff will go into effect June 1, 2010.
For more information or to sign up for Green Energy, visit www.georgiapower.com/green.
-----
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