The Georgia Public Service Commission (PSC) today approved Georgia Power’s request to enter into long-term power agreements in order to meet the future electricity needs of its customers in Georgia.

The PSC certified approximately 1,660 megawatts of generating capacity for use beginning June 1, 2005.

The commission also approved an amended 2001 Integrated Resource Plan filing that included an adjusted load forecast and the retirement of 11 older Georgia Power generating units at three plants.

The new approved electric capacity will come from two projects: a Southern Company combined cycle project to be developed at Plant McIntosh near Savannah, Ga., and a combined cycle plant, that begins commercial operation this summer, owned by Duke Energy North America in Murray County, Ga.

“We identified a capacity need for generation beginning in the year 2005 due to continued growth in the demand for electricity,” said Jeff Wallace, Georgia Power’s vice president of planning and pricing. “We are pleased that the commission approved our proposal because we believe that these projects best suit the long-term economic and reliability needs of our customers.”

The Plant McIntosh project will consist of two 620-megawatt combined cycle generating units that are scheduled to be in service by June 1, 2005. These natural gas units are designed to achieve superior fuel efficiency. The combined cycle units achieve a high level of efficiency by using natural gas to generate electricity with combustion turbines and then using the waste heat to make steam that is used to make additional electricity. Savannah Electric will purchase 200 megawatts of the plant’s output with Georgia Power purchasing the remaining 1,040 megawatts.

Beginning June 1, 2005, Georgia Power will also buy 620 megawatts of power from the Murray County plant. That represents the total output of one combined cycle unit, or half of the plant’s current output.

“This certification of this new capacity represents a continuation of the forward-looking planning process that the PSC has in place to ensure that there will be enough electricity available to meet Georgia’s demands in the future,” Wallace said. “The IRP is designed to ensure that Georgians have the power they need at the best price available."

The amended IRP indicates a slight decrease in the peak demand forecast – which reflects the impacts of a slower economy.

Additionally, the amended IRP will include the previously announced proposed retirement of 415 megawatts of generation from 11 units at Georgia Power Plants Arkwright, near Macon, Atkinson, near Smyrna, and Mitchell, near Albany. The retirements are the result of a unit retirement analysis that Georgia Power is required to conduct as part of the IRP process. That analysis determined that the 11 units are more expensive to continue to operate when compared to the cost of replacement power.