MONTGOMERY — The Alabama Public Service Commission on Tuesday voted to partially approve a proposal by Alabama Power Company to add capacity to the company’s grid as the national economy looks to recover from the COVID-19 pandemic and Alabama’s economy seeks to continue its pre-pandemic historic growth.
While full details will be unveiled when the PSC formally releases its final order, it was clear during the meeting that the commissioners approved Alabama Power adding approximately 2,000 megawatts to the company’s grid. Three separate projects account for that total, all utilizing natural gas.
The commission did not approve the company’s request for 400 additional megawatts using solar power paired with battery technology, with the PSC apparently wanting to keep everything approved to the proposal’s stated purpose: adding “reliability and dispatchability.”
As reported by Yellowhammer News during the three days of hearings earlier this year on the proposal, the company has explained that it is now winter-peaking, with a peak load time of about 6:35 a.m. CT in the winters. Because current solar battery technology only holds power for approximately two hours, it is not feasible to use solar to increase the grid’s capacity/the winter reserve margin for when that capacity is most needed: in the morning hours when the sun is not yet out.
Thus, the solar portion of the company’s proposal would not have been dispatchable — or reliable — when needed the most. PSC Chief Administrative Law Judge John Garner, presenting the commission staff’s recommendation on the company proposal, highlighted this fact. The staff recommended that the solar portion be evaluated through a separate, existing regulatory avenue available to the company.
One of the natural gas projects approved by the PSC is the addition of a unit at Plant Barry in Mobile County, to be known as “Barry Eight.” Another approved aspect of the proposal was the company purchasing an existing gas-burning plant in Autauga County, and the final aspect approved was purchasing power from the existing Hog Bayou natural gas plant in Mobile County.
In a statement to Yellowhammer News, PSC President Twinkle Andress Cavanaugh (R-AL) said, “Our final order will have all the details of our decision, and we will be able to elaborate more when it is issued. What I can tell you is that Alabama Power did not get all of what they asked for.”
The decision comes after the national jobs report released last week showed the national economy adding 2.5 million jobs, and the Nasdaq on Monday closed at a record high.
“We made a decision based on our confidence that the Trump economy is set to come roaring back like a lion. The jobs report on Friday showed that this is happening already,” Cavanaugh advised. “Alabama consumers will need to be prepared for a growing economy that will demand more energy infrastructure. Our actions today help prepare and protect consumers for those future needs.”
She concluded, “President Trump said this weekend that the American economy will see the greatest comeback in history. We absolutely believe that, too. And we made a decision on behalf of consumers to prepare for the historic comeback.”
Included in the report from Friday was the national manufacturing sector adding 225,000 jobs.
In a statement to Yellowhammer News, Manufacture Alabama president George Clark welcomed Tuesday’s PSC decision as a win for the state’s growing manufacturing industry.
“Manufacturing is one of the cornerstones of Alabama’s economy and, given that, we are pleased to see a favorable outcome for our members and partners in and around the manufacturing industry,” Clark stated.
“We thank the Public Service Commission for its continued commitment to keeping rates low as our state works to remain competitive in the recruitment of businesses and jobs to Alabama,” he continued. “This ruling will prove critical to jumpstarting our state’s economy post-COVID-19 as we continue to work to ensure we are meeting the needs of our members’ and their employees.”
National Mining Assocation president and CEO Rich Nolan recently wrote an op-ed published by Yellowhammer News about how “one critical industry in Alabama – the metallurgical coal industry – is poised to help lead the way” as the American economy recovers.
In a statement to Yellowhammer News, Alabama Coal Association president Patrick Cagle outlined how important Tuesday’s PSC decision was to his members.
“On behalf of some of the largest industrial electricity customers in Alabama, I thank the Public Service Commission for their pro-jobs commitment to supporting reliability and dispatchability for our grid,” Cagle commented.
He emphasized, “Safety is of critical, life-or-death importance for our underground coal mines, who each use over $1 million in electricity each month.”
“The PSC’s decision today will help ensure peak demands can be met moving forward, which is especially important as our country embarks on what should be a tremendous post-pandemic economic recovery. Alabama’s coal industry is looking forward to playing a key role in this recovery, and today’s decision helps make that possible,” Cagle concluded.
Tuesday’s decision was unanimous among the three commissioners — Cavanaugh, Commissioner Chip Beeker and Commissioner Jeremy Oden — and backed the recommendations of the non-partisan, subject-expert PSC staff.
Sean Ross is the editor of Yellowhammer News. You can follow him on Twitter @sean_yhn
