Advocating the power of competition



"Recent rate cases prove what EPSA has been saying for months - electricity rates are rising in all regions of the country, whether restructured or vertically-integrated. These rates reflect the cost pressures facing all electricity suppliers. The Georgia case in particular proves that rates in vertically-integrated states will increase even more as environmental controls are finally installed." John E. Shelk, President and CEO, Electric Power Supply Association


  • Georgia Power - an affiliate of Southern Company - asked the Georgia Public Service Commission on June 29 for base rate increases in 2008, 2009 and 2010. Rates would go up 7.06% in 2008. Over this period, rates would increase by over $120 per year for the average residential household. Ratepayers also pay a separate fuel adjustment charge that has been increasing.

  • Georgia Power cites critical infrastructure needs and environmental controls as the reason behind this large proposed rate change. Georgia Power is requesting an additional $8.2 billion from its customers through 2010, which means rates will continue to rise.

  • Costs are rising everywhere for the same reasons - "We are complying with the new federal and state environmental rules .... We're also working to ensure we have the electric infrastructure in place to maintain a reliable electric system for our customers as our state grows," said Mike Garrett, President and CEO of Georgia Power.

  • The Virginia State Corporation Commission on June 26 ruled that Virginia Electric and Power Company - an affiliate of Dominion - could increase its fuel factor by 18 percent, from 1.891¢ per kWh to 2.232¢ per kWh starting on July 1, 2007. The average residential customer will see his annual electricity bill increase more than $40.

  • Dominion will recover $219 million for increased fuel costs over the next year. However, $443 million will be deferred and Virginia customers will be forced to pay a total of $662 million over the next several years - solely due to increased fuel prices. (One of the disadvantages of the vertically integrated model is that there is no incentive to control fuel costs when they can be recovered separately from ratepayers).

  • Rocky Mountain Power - a division of PacifiCorp - filed with the Idaho Public Utilities Commission (IPUC) on June 8, 2007 for a 10.3% rate increase. This will raise rates for the average residential customer 6.7% and a 24.1% rise for its largest industrial customer. Rates are rising to meet increased fuel, generation, transmission and other costs.

  • "The proposed increase is needed as the result of the company's need to meet the increasing cost for electricity," said Rocky Mountain Power President Richard Walje. "The Company finds itself in a position similar to that of many utilities across the nation."

  • Idaho Power Company on June 8, 2007 filed with the IPUC to increase rates an average of 10.35%, raising rates for the average residential customer by $33.60 annually. Idaho Power is seeking to recover more than $200 million in distribution and transmission investment as well as for routine maintenance.

EPSA PowerFact: Electricity Prices Rising in Vertically-Integrated States.PDF

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EPSA is the national trade association representing competitive power suppliers, including generators and marketers. These suppliers, who account for nearly 40 percent of the installed generating capacity in the United States, provide reliable and competitively priced electricity from environmentally responsible facilities serving global power markets. EPSA seeks to bring the benefits of competition to all power customers.