Georgia Power is back at the Commission this year for two cases that will impact customer bills starting in June. (See how this and other policies implemented at the Public Service Commission, or PSC, impact your bill in our explainer.) One of these is for Georgia Power to get approval by the Commission to adjust the Fuel Cost Recovery (FCR) Rate that appears on all Georgia Power bills, the other is to increase bills to pay for the cost of storms, particularly Hurricane Helene. This is yet another reminder that we’re all paying for fossil fuels and their impacts on the climate on our electric bills already.
What is the FCR?
The FCR docket is where Georgia Power and the Public Service Commission (PSC) determine the fuel cost portion of electric bills. The fuel cost portion of the bill has two parts: one that allows Georgia Power to recover any over/under from the previous 3 years, and another that forecasts their fuel costs for the next 3 years. Then they divide that up among customers, and how much they think customers will use to get to a $/kWh amount that is used to calculate bills. Because fuel costs are passed on directly to the customer, this part of the bill is separated from traditional rate cases.
A little history on FCR in Georgia
Georgia Power last adjusted its FCR three years ago, resulting in the largest jump in customer bills in recent years, a whopping $20/month on average. That increase was largely due to the spike in “natural” gas prices in 2022 after Russia invaded Ukraine.
So if that was such an unusual case, as utilities would like us to believe, is Georgia Power reducing bills by $20/month in this request? No. They are proposing to reduce FCR and thus bills, but by $7-8/month. We think they should be reducing bills more AND we think it’s well past time the Commission put some new rules in place to keep these bills from continuing to rise in the future.
FCR Should Be Lowered More
First, based on our expert’s review of how Georgia Power ran its power plants over the last 3 years, we have some concerns and don’t think Georgia Power ratepayers should be on the hook for the utility’s mismanagement of its resources. We found that, particularly for Plant Bowen, Georgia Power was using its coal plants even when there were cheaper resources available to meet the load. This is at least in part because Georgia Power seems to be systematically over-forecasting load and under-forecasting solar generation.
Our immediate recommendation to the Commission for this is that they disallow some of the fuel costs Georgia Power is asking to recover in this case. Relatedly, the Commission should open a separate docket to consider whether Plant Bowen, which is very expensive to operate, should be retired. Customers cannot wait until the next IRP in 2028 for this critical decision; Plant Bowen is making bills go up now. The sooner it can be shut down, the better for Georgia Power ratepayers.
“The results above indicate that the Company routinely committed and operated Plant Bowen when its generation was not needed and lower-cost sources of generation were available.” and “In separate proceedings , like the next Integrated Resource Plan, the Company and the Commission should assess whether Bowen should be retired due to its high fuel costs and other factors. In this proceeding, however, the Commission can disallow costs that were imprudently incurred from the excessive operation of Plant Bowen.”
~Michael Goggin, Grid Expert, Testimony in Georgia Power FCR-27 submitted April 9, 2026
Storm Costs Not Only in the Storm Recovery Docket
Parallel to the FCR, Georgia Power is asking the Commission to increase bills in order to pay for all the damage storms, particularly Hurricane Helene, did to electricity infrastructure over the last 3 years.
But the cost of these storms and extreme weather isn’t limited to the storm cost recovery docket. In this fuel cost docked, while the exact cost is considered confidential by Georgia Power, it’s clear that the cost to supply power during extreme weather can significantly contribute to overall fuel costs that are passed on to customers. This is because Georgia Power has to purchase gas when it is very expensive, and then burn a lot of gas to meet peak demand.
Fuel Cost Sharing Would Fix Moral Hazard
How did Georgia Power customers keep getting bill increases from fuel costs when they don’t get a say in what kinds of power plants Georgia Power builds/buys? It comes down to who the decision makers are and who bears the risks. Under the current setup, Georgia Power ratepayers pay 100% of the fuel costs. But it doesn’t have to be that way. As described in fuel cost policy expert Jeremy Kalin’s testimony, nine states across the country already have fuel-cost sharing in place, where a utility’s shareholders share in some of the fuel cost risk.
“In the nine states with fuel-risk-sharing today, their Commissions have found such policies to be in ratepayers’ interest.”
~Jeremy Kalin, Fuel Cost Policy Expert, Testimony in Georgia Power FCR-27 submitted April 9, 2026
So are we asking utilities to assume all the risk of fuel price volatility? No, we are only saying they should have some skin in the game with the rest of us. In fact, as Kalin testifies, a utility being responsible for just 10% of the risk is “often sufficient to incent utilities to more aggressively manage fuel risk exposure.”
Instead, we are asking that the Commission follow the recommendations of our experts: disallow uneconomic coal costs, and set up a Fuel Cost Recovery Modernization docket to set in place a requirement that the utility be responsible for a portion of the fuel cost risk. This may sound super wonky and technical, and it can be at times, but it’s also a way for the Commission to reverse a long-standing policy that was never supposed to be permanent while protecting the long-term affordability of electricity bills for Georgia Power customers.
