Georgia should consider a mandate that would require utilities to get a larger percentage of their fuel from alternative sources such as solar, even if it costs consumers another nickel a month, a state utility regulator said Tuesday.
Georgia Public Service Commissioner Bubba McDonald said such a standard would beef up the currently undervalued market for solar in Georgia and open the market for new investors. McDonald didn’t give a timetable or other specifics.
“As we look at energy down the road, we have to look at all possibilities,” McDonald, a Republican, told The Atlanta Journal-Constitution.
Yet, McDonald’s remarks, which surprised the other regulators at Tuesday’s commission meeting, raised concerns that Georgians would pay more for electricity. Alternative forms of energy such as solar and wind are more expensive to produce than traditional fuels. Those costs often are passed on to consumers.
His suggestion also comes at a time when Georgia Power, which is owned by the Southern Co., and other utilities are pushing back against proposed federal environmental regulations that could require them to close or retrofit several coal-fired power plants. Customers would end up paying for the pollution-control equipment required to comply.
The Obama administration has backed away from its requirement for 10 percent of the nation’s electricity to come from renewable sources by 2012, and 25 percent by 2025. Several states have adopted their own requirements, but Georgia, as well as most of the Southeast, has not.
“Historically this commission has taken a position that a ‘renewable portfolio standard’ is a choice that has not been right for Georgia,” said PSC Chairman Stan Wise, a Republican. He said he’s concerned about prices and the reliability of alternative energy sources.
Yet some lawmakers say developing a requirement for more alternative fuels would help in absence of a national energy policy.
“Our lack of an energy policy is an absolute Achilles’ heel when it comes to foreign policy,” said Rep. Scott Holcomb, D-Atlanta. “We have a fair amount of promise in solar and in wind.”
It’s unclear how a standard would be adopted. It likely would take a change in state law and PSC rules.
Rep. Don Parsons, R-Marietta, said the Legislature would need more information even before considering such a change.
“There’s going to be a time when these traditional sources of energy aren’t going to be there, and we have to prepare for that,” said Parsons, chairman of the House Energy, Utilities and Telecommunications Committee. “But I can tell you with a lot of certainty it’s not something that’s going to happen in Georgia anytime soon.”
McDonald has said previously that he is not a fan of mandates. But he has been pushing for more solar energy in Georgia, including asking Georgia Power to expand the tiny amount it gets from sun-powered electricity.
“I’m hypocritical to some degree,” McDonald said, “but if it takes 3 cents or 4 cents or a nickel on the ratepayers of Georgia to get that started, I’m for it.”
Greg Chafee, chairman of Morris, Manning & Martin’s green industry practice, said, “The industry supports public policy changes that does make Georgia more competitive for solar investment.”
In a statement, Georgia Power said it would not support any sort of mandate to add more renewable fuels because it does not make economic sense.
However, the company said it would buy up to 50 megawatts of solar power to meet McDonald’s request from earlier this year. A megawatt would power one SuperTarget or 400 homes.
The utility said it would strike agreements with individual solar-power producers to meet this goal.
The utility hopes to start signing contracts on some of the projects as early as December. It would not need the power until 2015, which is when the company may have to close some of its coal-fired plants, a company spokeswoman said.