Rabun County Powerline Controversy

Georgia Transmission Corporation (GTC) has announced its intention to construct a 115 kilovolt transmission line to “serve the projected load” for the Rabun County, Georgia area. The proposed transmission line would be located north of Lake Burton; specifically, in the Persimmon Valley area. The proposed line is also intended “to help GTC maintain overall system reliability” for the entire utility system. GTC has proposed three routes, all of which go through Rabun County.

Since Rabun County is composed of only about 30% private land, the proposed lines would, in effect, destroy the scenery in a beautiful farm and tourist community. The lines would cut across mountains and through river valleys; tower over schoolyards, churches and historic landmarks; and loom over a senior citizen’s center and a retirement home. The farming valleys, with their lush orchards, vineyards, field crops and rolling pastures, would be forever scarred. The natural wonder and bountiful wildlife of wetlands and forests would be threatened. The proposed transmission line is, therefore, a very important situation facing the citizens of Rabun County.

Not all of the proposed routes go through land that is part of the Chattooga River watershed; however, this project would have far-reaching impacts on the future of an area, which so far has been managed to preserve much of its natural beauty. The Chattooga Conservancy (formerly Chattooga River Watershed Coalition) has been instrumental in forming a coalition of concerned citizens called the Citizens for Rabun’s Heritage. This group is working to address the issues raised by the proposed transmission line project. With the help of their elected officials, these and other citizens have persuaded GTC to grant additional time to consider this project. To that end, Citizens for Rabun’s Heritage hope to provide the facts and background information necessary to make the upcoming important decisions regarding future electrical construction projects in Rabun County.

History

The evolution of the electric utilities into the large corporations of today, from the small rural electric cooperatives created in the 1930’s to bring electricity to the farmers, has been long and complex process. The passage of the Rural Electrification Act established a federal agency that was authorized to loan money to cooperatives so that they could build rural power lines. Habersham Electric Membership Corporation (EMC) was chartered in 1938, and by June of 1939 there were lines in Habersham, Rabun, and White counties (Georgia). Under its charter, Habersham EMC bought power from other utilities (like Georgia Power) and built lines to expand its service area to new customers.

As use of electricity increased, the utilities grew. By the early 1960’s utilities were connected to each other from coast to coast, buying and selling power to each other as needed to meet consumer demand. The infamous blackout in New York City, which nearly caused the entire eastern seaboard to lose power, brought out the need for reliability guidelines in the electric industry. As a result, regional reliability councils were formed throughout the country. The Southeastern Reliability Council (SERC) includes Georgia, North Carolina, South Carolina, Alabama, Mississippi, Tennessee, part of Virginia and until recently, Florida. The SERC establishes reliability criteria for the construction, operation and maintenance of power systems owned by utilities located in its region.

Several changes in the energy marketplace during the late 1960’s and the early 1970’s had dramatic impacts on the electric utility industry. The United States entered an era of increased environmental awareness, rising fuel costs, developing concern for preservation of natural resources, and mounting fears regarding nuclear safety. The net effects were drastic increases in the costs of building new power plants that could meet the more stringent environmental and safety regulations, and a resulting slow down in the construction schedules. Georgia Power, which had initiated an aggressive building plan in an attempt to keep up with the fast growth in Atlanta and the rest of the Southeast, got caught in a financial bind due to the cost escalations.

In 1974, the Georgia legislature passed a law which enabled Georgia Power to get much needed additional funding to proceed with its nuclear power plant construction. The legislation created Oglethorpe Power Corporation from thirty-nine Electric Membership Corporations (EMCs), and created the Municipal Electric Authority of Georgia (MEAG) from forty-seven cities and Crisp County. These entities were granted partial ownership of the plants under construction and portions of other existing plants, as well as partial ownership of the large transmission system that traversed the state (now called the “Integrated Transmission System”), in exchange for providing monies from their respective funding sources (the Rural Electrification Act for Oglethorpe, and municipal bond issues for MEAG).

In addition, Georgia Power later procured additional funding to complete its construction plan by setting up long term contracts to sell the power output of its two newest coal plants to Florida utilities. This action, which was precipitated by the cessation of power plant construction in Florida due to the state’s strict environmental and anti-nuclear policies, led to the accusation by many that “Florida’s air was being cleaned with Georgia’s lungs.”

In an attempt to encourage expansion of renewable resource based technologies such as solar and wind, Congress passed the Public Utilities Regulatory Policy Act (PURPA) in 1978. PURPA established specific guidelines under which the electric power output of independently owned facilities could be sold to the electric utilities for re-sale over the power grid. Entrepreneurs saw in PURPA the opportunity to get into the power business without being subjected to utility regulations. However, the cost structure of the utilities, which was the basis for calculation of the price of the electricity to be sold back to the utilities, made it uneconomic in most cases for the independent power producers to sell back to the utilities. Consequently, in the absence of intervention by state lawmakers, or regulators in the form of additional incentives to the utility to purchase from the non-utility power producers, the objectives of PURPA remained unmet in Georgia and many other states.

Current Situation

The failure of PURPA to sufficiently diversify the mix of power generation facilities in electricity production across the nation has been a major factor in the move towards deregulation of the electric utility industry. The Federal Energy Regulatory Commission (FERC) has taken steps toward deregulation of the electric utility industry by issuing guidelines for the formation of regional transmission organizations (RTO). These RTOs would be independent organizations that operated transmission systems of the utilities spanning several states. The deadline set by FERC for initiating the voluntary formation of the RTO’s is November 2000; thus far, the Southeast region is behind the rest of the country, due to difficulties of the utilities involved in reaching mutually satisfactory agreements.

In anticipation of deregulation, Oglethorpe Power Corporation was restructured into three separate corporations in 1997. GTC purchased the transmission facilities previously owned by Oglethorpe, and is responsible for constructing new transmission lines and substations. Oglethorpe is now only in charge of the power generation part of the business. The third company, Georgia System Operations Corporation, is in charge of the daily operation of the entire system, as well as in sales and purchases of power from other utilities. GTC is currently involved with the other utilities in the Southeast in discussions regarding the formation of an RTO.

Rabun County Controversy

When GTC announced its plans for the North Burton project, there were several questions that immediately surfaced: Why is such a large line being proposed? Which government agency regulates GTC and decides if this line is really needed, or determines the best location? The answers to these questions depend upon whom is asked, and context of the questions. Unfortunately for the citizens of Rabun County, the answers reveal a unique and distressing situation in Georgia, compared to most other states in the country.

According to GTC, the 115 kilovolt line is required to meet local load projections starting in 2002, and to maintain system reliability criteria. Yet a 155 kilovolt line is, by definition, a transmission line rather than a local distribution line. Based on limited conversations with the engineers at Habersham EMC and GTC, the expected demand for electricity in the local area is only about 1/10 of the amount to be carried by the 115 kilovolt line. System reliability criteria add an extra margin of safety to the known size requirements (to prevent blackouts and to preserve electrical equipment), but for most utilities in the country, that reliability margin is in the range of 10 to 20%. So even when the reliability margin is added to the load requirements, the planned line size is much bigger than the local community needs. Concerned citizens are still trying to obtain copies of engineering studies used to develop the project requirements, but utility personnel have so far been resistant to requests for the documentation that substantiates their claims about the need for larger lines. Due to the large discrepancies between local needs and the proposed project, it appears that GTC wants to build the transmission line to serve electrical needs outside of Rabun County and perhaps outside of the state of Georgia, despite their protests to the contrary.

With regards to the question of regulation—or more to the point—the question of who is in charge of making sure the utilities’ proposals are ultimately implemented in the best interest of everyone involved, the answer is quite complicated. Unlike the investor-owned utilities (Georgia Power and its counterpart, Savannah Electric and Power Company), the Georgia Public Service Commission (GPSC) does not regulate Habersham EMC or GTC.

As nonprofit corporations formed from the rural electric coops, the activities of the EMCs were considered to be self-regulating; that is, owners of the corporation, who are the members (rate paying customers), are theoretically in charge. Each year the members of each EMC have an annual meeting at which they review the operations of the EMC and elect individuals to fill open positions on the EMC’s Board of Directors, who are supposed to be the watchdogs for the members. (Ironically, the directors rarely have the technical background to fully appreciate the implications of the decisions they are asked to make.) In like fashion on a larger scale, the EMCs own OPC, GTC and GSOC, and review their operations as well as elect their respective Board of Directors. In reality, individual participation in the EMCs is minimal or nonexistent, except in cases of great controversy. Similarly, the influence of each EMC on its subsidiary corporations is limited to issues of specific relevance to an individual EMC.

In general, both the day to day operating decisions, as well as larger issues of corporate policy are decided by the employees and management of these companies, with almost no input or oversight from people or governmental bodies outside the organization. The major exceptions to this unsupervised situation occur under very specific circumstances: 1) requests for funding from the Rural Utilities Service (RUS) are reviewed for conformance with generally accepted utility practice; 2) sales of electric power from one utility to another are reviewed by the Federal Energy Regulatory Commission; and 3) reported violations of environmental regulations are investigated by the appropriate state and federal organizations. Plans for new construction projects are reviewed by no governmental organization, since Georgia is one of the few states in the country with no siting law for facilities proposed by either utilities or independent power producers.

What is being done?

As Rabun County’s controversy moves into the spotlight, similar situations in the state that have occurred over the past several years are also coming to light. According to GTC’s 1998 Annual Report, eighteen substations and eight transmission line projects of the 115 kilovolt size were completed in 1998. (As of this writing, the 1999 Annual Report was not available for comparison.) More shocking is the fact that every transmission project completed in the past two years by GTC has been fought by locals, but won by GTC in the State Supreme Court. The communities affected have given every indication that they object to the projects, but laws to protect the communities are nonexistent and the state courts are consistently turning a sympathetic ear to the corporations. It is a sad state of affairs that the rural electric co-ops started in the 1930’s to help the farmers by providing rural communities with the opportunity to use electric power have mutated into large, out of control corporations which announce that they have the “constitutional right” to build power plants or lines, and put them where they want to whether the communities they are supposedly serving want them or not!

It would seem that the cries of the Rabun County citizenry may be as futile as previous local opposition, but the battle is not yet over. The good people of Rabun County are reasonable and hardworking, and they are pulling together to address a common threat: the needless destruction of the natural beauty of their mountain homeland for the sake of the pocketbooks of advocates of mindless growth. The citizenry of Rabun County have already enlisted the aid of their elected officials to slow down the GTC project, so that it can be more thoroughly examined. The issues raised by the Rabun County power line controversy have also identified several areas which may require further action to prevent the reoccurrence of similar situations either in Rabun County or elsewhere in Georgia.

Besides becoming more actively involved in the operations of the local EMC and staying informed about the activities of its subsidiary corporations, further investigations must be done into the lack of appropriate siting legislation in the state of Georgia. In the absence of such state legislation, local governments may want to consider passing ordinances which protect their community’s interests. Such an ordinance has successfully made it through the first stage of passage in Rabun County, thanks to the responsiveness of the County Commissioners. Not unexpectedly, GTC responded swiftly and negatively to the actions of the Rabun County Commission. Too bad GTC has not been so efficient in cooperating with the requests for documentation to substantiate their transmission line proposal!