More than six years after its last Fuel Cost Recovery Allowance increase, Savannah Electric today received approval from the Georgia Public Service Commission (GPSC) to raise its fuel allowance by slightly over one-tenth of a cent per kilowatt-hour ($0.00141/kwh). The measure will become effective February 1, 1999.
Under Georgia law, electric utilities are permitted to recover through a Fuel Cost Recovery Allowance only what has actually been spent for fuel or purchased power, with no profit or mark-up. The proposed increase is necessary because electric load growth has required the company to operate those generating units having higher fuel costs more frequently. Purchased power costs have also risen due to electric load growth at other utilities.
Under the proposed fuel allowance, a typical residential customer paying approximately $80 per month will experience a 2.0 percent increase of $1.60 on their monthly bills beginning in February. The increase applies to commercial and industrial customers as well.
Even after this fuel allowance increase, Savannah Electrics prices will remain well below the national average and below what most pay in the Southeast.
Prior to this request, the last change in Savannah Electrics fuel cost recovery allowance was a reduction, which occurred in the Summer of 1996. The last increase took place in December 1992.
Savannah Electric last raised base rates -- that portion of its prices covering investment in power plants, substations, wires, poles, equipment, and daily operating costs -- 14 years ago in 1985, and subsequently implemented base rate reductions to all customer classes in 1988, 1990, 1991, and 1992.
Savannah Electric serves 125,000 customers in a five-county area of Southeast Georgia. Savannah Electric is a subsidiary of Southern Company. Southern Company (NYSE: SO), the largest producer of electricity in the United States, is the parent firm of Alabama Power, Georgia Power, Gulf Power, Mississippi Power and Savannah Electric. Based in Atlanta, Southern Company, through its Southern Energy Inc. subsidiary, supplies electricity in 10 countries on four continents. Southern Company also provides energy-related marketing, trading and technical services, and Southern LINC wireless telecommunications.