Battlefield: Georgia – Who Is Allowed To Sell Solar Energy in the Peach State?

In a state that has been teeming with solar resources since the beginning of time, it’s ironic that a fight to seize upon that great, untapped resource is only now taking place. In a recent study performed by the University of Arizona, Georgia ranked in the top three U.S. states most capable of harnessing that abundance of solar to not only create clean energy, but to also create new jobs and dramatically increase state and local revenue. Yet to date, that potential remains far from full realization. But if a certain Atlanta-based startup gets its way, it may only be a matter of time before the first giant leap is taken.

That company, Georgia Solar Utilities Inc (GaSU), aims to become another utility in the state and sell power to customers through Georgia Power. GaSU recently put a proposal before the Georgia Public Service Commission to take advantage of the Peach State’s massive solar potential, bringing the possibility of new jobs and a richly desired diversification of the state’s energy portfolio. The proposal, which was submitted on September 20, lays out GaSU’s plans to develop an 80-MW solar PV farm and sell power directly to consumers. If approved, the project may eventually expand to 2 GW of solar PV capacity by the year 2016.

Standing in the way of GaSU’s efforts is a 30-year-old law that essentially gives Georgia Power a fully legal monopoly on providing utility services throughout the state. In order for GaSU’s bid to be successful, an amendment to the Georgia Territorial Service Act of 1973 would be required.

According to experts, GaSU could go forward and build the 80-MW farm without intervention of the public service commission and existing law would even compel Georgia Power to purchase the resulting energy but only at the cost of its lowest wholesale electricity rate.  Instead, the start-up would like to sell power directly to customers who would be billed by Georgia Power, very similar to the way natural gas is sold in Georgia.  GaSU would pay Georgia Power for the use of its transmission infrastructure and then share profits with its customers in the form of rebates, resulting in lower utility rates over time.

Meanwhile, in a move that might be construed as an attempt to secure its position as the state’s premier supplier of solar energy, Georgia Power has proposed the creation of the Georgia Power Advanced Solar Initiative (GPASI). Under the initiative, which was proposed to the Public Service Commission on September 26, Georgia Power will pledge to acquire 210 MW of solar power capacity between now and 2015. Currently, Georgia Power has a modest solar portfolio totaling 61.5 MW. The plan would have the newly-formed GPASI adding 60 MW per year through large-scale competitive bids, with the remaining 10 MW being added through distributed solar programs available on the residential and small business level.

Rhone Resch, president and CEO of the Solar Energy Industries Association (SEIA), said Georgia Power’s idea is a good start, but also indicated that it is not enough to truly take advantage of Georgia’s vast solar resources. “Georgia Power’s initiative demonstrates that solar is a trusted and reliable energy source and has an important role in achieving fuel source diversity,” Resch said in a statement. “However, more needs to be done for Georgia to become a true leader in solar and to build a sustainable solar market in the state.”

Resch may be referencing the fact that solar leasing companies are also currently unable to operate in the state of Georgia under the same Georgia Territorial Service Act of 1973. Last February state Senator Buddy Carter proposed and then withdrew an amendment (SB 401) that would allow small businesses and homeowners to lease solar systems from third parties under PPAs. Experts say that he withdrew the bill after learning that Georgia Power had influenced some of his “yes” and “maybe” votes to “no.”

The prevailing opinion that’s led some to conclude that Georgia Power may not be interested in statewide efforts to expand the use of solar energy is bolstered by a report released by Green America in 2011 titled “Leadership We Can Live Without: The Real Corporate Social Responsibility Report for Southern Company.” The report gave Georgia Power’s parent, Southern Company, an “F” for its heavy reliance on coal and nuclear power, as well as for the company’s overall output of air and water pollution.

Speaking to the two initiatives now before the Georgia Public Service Commission, Resch added, “Important policy decisions lie ahead. It’s vital that the Georgia Public Service Commission allow both centralized and distributed solar generation to fulfill a larger role in the state’s energy mix.” Resch called the Georgia Power proposal “limited” and said “distributed solar must be allowed to grow at a rate higher than 10 MW per year in order to create a truly sustainable market and jobs across the state.”

“In addition, the state needs competitive rules and standards for connecting to the grid as well as policies to allow for other solar providers to participate in the market,” he said.

According to GaSU, the Georgia Public Service Commission is evaluating the GaSU plan and the Georgia Power plan right now and an answer from staffers is expected within the next two weeks. While Georgia Power has so far been able to block proposed changes to legislation, it’s not inconceivable that concessions may be made in an effort to boost Georgia’s sagging jobs market. Recent estimates by the Georgia Department of Labor place the state’s unemployment rate at 9.2 percent, more than a full percentage point ahead of the national jobless average of 8.1 percent.

Lead image: Panoramic view from Brasstown Bald, the highest natural point in the state of Georgia via Shutterstock.