Utilities, Member of PSC Spar
By Margaret Newkirk, The Atlanta Journal-Constitution
Apr. 19–Attorneys for Atlanta Gas Light, Georgia Power and AT&T all said it Wednesday: The Georgia Public Service Commission isn’t broke.
But it was Georgia Power’s attorney, Kevin Greene, who said it most often during a PSC hearing on a proposal that would force the commission’s business further out into the open.
So Greene and Georgia Power would become the target later, when the hearing wound down and Commissioner Angela Speir pounced.
Speir is the author of a proposed rule that would ban “ex parte,” or private, conversations between commissioners and people with business pending before the PSC. Such rules exist in some form in most states and are supported here by, among others, Common Cause, AARP and the Consumers Utility Counsel — and opposed by every major utility in the state.
Utility lawyers made a number of arguments against the rule Wednesday. The most common was that voiced repeatedly by Greene, a Troutman Sanders attorney who represents Georgia Power.
“No one has made any showing that any decision of this commission has been adversely affected by the lack of ex parte rules,” he said once.
“So far no one has presented any evidence,” he said again, “that ex parte communications have or will adversely affect the outcome of a commission case.”
The hearing rolled on. Commissioners Doug Everett and Chuck Eaton asked some questions. Chairman Robert Baker and Commissioner Stan Wise stayed mum, as did Speir, until the end.
Singling out Greene, she challenged the statement that no one had demonstrated that private conversations had adversely affected the outcome of a PSC decision.
“Settlements in three major rate cases in the last six years have been reached privately, behind closed doors between a commissioner and the utility, with none of the other parties present,” she said, referring to two Atlanta Gas Light rate cases and one Georgia Power rate case.
“I even have an electronic copy of one of the commissioner settlements that shows the utility’s law firm as the author,” she said.
She was referring to an out-of-the-blue order that ended the 2001 Georgia Power rate review. That case has become a poster child for those arguing that ex parte rules are needed.
The case ended with then-PSC Chairman Lauren “Bubba” McDonald putting that three-year order on the table the morning of the vote — a proposal that at least one commissioner, the commission staff assigned to hammer out settlements with Georgia Power and other parties to the case hadn’t seen until that morning, according to transcripts of the meeting.
The implication then was that Georgia Power hadn’t seen it either. “If my motion passes,” McDonald said, “I shall suspend the meeting to allow Georgia Power time to consider whether they will accept the proposed accounting order.”
Because the deal spanned three years, Georgia Power needed to agree to it.
After McDonald’s recess, the company did in fact agree, which wasn’t surprising, according to the document Speir referenced Wednesday.
That Microsoft Word document was created at Troutman Sanders and written by Greene, as Speir learned by accessing its electronically embedded history. It’s the same proposal McDonald put on the table that day and then allowed Greene, on behalf of Georgia Power, to review.
McDonald’s 2001 motion passed 4-1 after — as Georgia Power says — some robust discussion in full public view.
It’s not unusual for utilities or other parties to float sample orders during the settlement talks in the last days of a rate case.
It is unusual for such documents not to be seen by the staff and parties actually involved in settlement talks.
Did the Troutman Sanders/McDonald communication “adversely” affect the case’s outcome as Speir alleges?
Speir says yes.
The final staff recommendation in the case had been to cut rates by roughly $200 million. McDonald’s order, approved by the commission with few changes, was billed as a $118 million-per-year rate cut. In fact, it was a $5 million-per-year rate cut. The balance was money Georgia Power actually owed ratepayers — a reimbursement, not a rate cut.
Georgia Power strongly defends the 2001 order. “The rate reduction in 2001 was fair to all parties,” said spokesman John Sell. “It was approved on a 4-to-1 vote after full deliberation on the record by the commissioners. And then Georgia Power agreed to the three-year order.
“The order was based on evidence that was presented during the hearing process, and we feel like it was a fair order based on the fact that nobody appealed it,” he said.
The strange ending of the 2001 case was not repeated in 2004, in Georgia Power’s last rate case. Proposed orders were floated to all involved.
But the specter of ex parte mischief hasn’t disappeared. A mystery order from a commissioner also surfaced in an Atlanta Gas Light 2005 rate case, resulting in the reversal of a consumer-friendly vote.
The commission meets again April 26 to consider how to go forward with the proposed rule.
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