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The five-year agreement announced recently for Alabama Power Co. to supply steam to the Goodyear Tire & Rubber Co. plant in Gadsden is good news on a couple of fronts.
One, the pact will help keep Goodyear viable long term; and two, it’s good for the environment because Alabama Power is switching from using coal to generate electricity and steam to mostly natural gas, which produces fewer emissions.
New Environmental Protection Agency guidelines go into effect Jan. 1, requiring most of the country’s coal-fired plants to reduce emissions of 84 different toxic chemicals. By switching to natural gas for most of its operations at the Gadsden plant, Alabama Power will be able to keep the rates it charges Goodyear lower because it won’t have to pass along higher costs associated with burning coal. Alabama Power spokesman Michael Sznajderman said the plant is not completely weaned off coal, but the relatively lower cost of natural gas, coupled with potential future costs to control emissions from coal, makes this a good economic decision.
Local lawmakers and officials have been working to ensure Goodyear maintains a strong presence in Etowah County, and the contract is part of that. Public Service Commissioner Terry Dunn of Southside said a new contract has been a goal of his since he took office in January. State Rep. Blaine Galliher, R-Rainbow City, said the contract is part of continuing efforts “to work with corporate Goodyear (to show) that we are extremely interested in its long-term viability, and this is another step in that direction.”
The new EPA regulations have been roundly criticized by the coal industry while being praised by environmentalists and health agencies. The coal industry says the rules, which were mandated by Congress 21 years ago, will destroy thousands of jobs. The American Lung Association says they will save thousands of lives each year and reduce exposure across the country to a multitude of toxic chemicals. Each side has its spin on the overall effect on the economy, and we won’t attempt to decipher which one is telling the truth. We suspect it’s somewhere in the middle of the two extremes.
What we do believe is that the change at the local plant will be beneficial to the health of area residents, and the economy.
Copyright © 2011 GadsdenTimes.com — All rights reserved. Restricted use only.
Alabama Power's switch to natural gas an asset for Goodyear
By Dana Beyerle Times Montgomery Bureau
Published: Monday, December 19, 2011 at 6:04 p.m.
MONTGOMERY — Alabama Public Service Commission member Terry Dunn on Monday announced a five-year steam supply contract between Alabama Power Co. and the Goodyear Tire & Rubber Co. plant in Gadsden.
Dunn said the contract is subject to PSC approval this week.
"In my first meeting with executives of Alabama Power, only a day or two after I took office, a new contract with Goodyear was near the top of my agenda," Dunn said in a statement.
The story behind the story is about the fuel used to produce steam and electricity at the Alabama Power plant and the cost savings to both Alabama Power and Goodyear.
Alabama Power is switching from coal to mostly natural gas, a cheaper fuel, at the Gadsden electricity generating plant, partly because of new environmental regulations.
Any savings from cheaper fuel could be instrumental to lessen or nullify the need for Alabama Power to pass higher costs from coal burning mitigation efforts on to Goodyear, a major employer that local and state officials are trying to keep in Gadsden.
"We continue to work with corporate Goodyear (to show) that we are extremely interested in its long-term viability and this is another step in that direction," state Rep. Blaine Galliher, R-Rainbow City, said.
Alabama Power’s electric generating plant uses steam to produce electricity, and steam also is required in tire making at Goodyear.
Alabama Power’s Gadsden plant has the capability to produce steam and electricity using coal or natural gas, or both. The plant also was an experimental site for burning wood biomass and switch grass fuels, but the plant now does not burn biomass. It’s using more natural gas than coal, company spokesman Michael Sznajderman said.
He said the relatively lower cost of natural gas, coupled with potential future costs associated with coal burning exhaust mitigation equipment, means natural gas is more economical.
"We’re not completely weaned off coal," Sznajderman said. "The goal is to have flexibility. It’s good economics at the plant because the price of natural gas is coming down."
Natural gas also is cleaner burning than coal, which can require expensive pollution reducing equipment.
Dunn said negotiations took on greater significance because of the tougher air pollution rules that take effect Jan. 1.
"The new environmental requirements, coupled with low prices in the current natural gas market, made operating the company’s Gadsden plant on natural gas a more economic alternative than operating it on coal," he said. "The new contract minimized the cost impacts of the new requirements both to Goodyear and Alabama Power," he said.
Goodyear released a statement: "Goodyear-Gadsden appreciates the efforts of Commissioner Dunn and our elected officials in their quest to retain current industry in Etowah County and the entire state of Alabama. We have had a long-standing relationship with Alabama Power Co., and we’re proud that it will continue."
MONTGOMERY – Alabama Public Service Commission member Terry Dunn met this week with state Attorney General Luther Strange to discuss the potential impact on electricity rates – and the Alabama economy – of a new federal rule on air quality.
The new “Cross-State Air Pollution Rule” was made final by the U.S. Environmental Protection Agency (EPA) on July 6. It requires Alabama and 26 other states in the eastern half of the country to reduce power-plant emissions that cross state lines. The first round of emission reductions under the new rule is effective Jan. 1,2012.
“We let the attorney general know that we are ready to work with him in any way we can to prevent these regulations from causing electricity prices to increase,” Dunn said. “Attorney General Strange has been right on top of this issue for some time, and we appreciate his efforts.”
The commissioner said Alabama Power Co. is analyzing the potential effects of the new pollution rule and should report its findings to the PSC soon.
Dunn said maintaining healthy air quality in the state’s metropolitan areas is important, “but this is not the time to implement a regulation that will put a greater financial burden on Alabama households and businesses.”
PRESS RELEASE
MONTGOMERY – Commissioner Terry Dunn praises the Alabama Public Service Commission staff for its recommendation this week that the PSC act now to replenish Alabama Power Company's storm reserve.
"In the name of transparency, let's be clear that this vote will produce $153 million in revenue for Alabama Power," Dunn said. "The first $30 million-plus will go directly to the storm reserve. And a large share will pay for nuclear-plant maintenance that the previous Commission voted in 2010 to delay until this year."
At this week's meeting, the PSC staff recommended that commissioners change a tax-related tariff that no longer applies under the company's rate structure, which is a formula called "Rate Stabilization and Equalization," or RSE. Under RSE's forward-looking budget, the PSC staff members said, it is already clear that the company would collect more than $153 million for 2012 in order to stay within RSE's allowed range of return.
The PSC order implementing this week's unanimous decision will state explicitly that there will be no upward adjustment in RSE for 2012.
Dunn told a company executive that Alabama Power should plan on zero increase in 2013 as well. Still, Dunn praised the company's performance in the wake of the tornadoes of April 27 and strongly supported the move to replenish the storm reserve.
"Mid-August is when the Atlantic hurricane season begins its peak period," the commissioner said. "Heaven forbid we should have to deal with more storms, but we need to be prepared. We can't play games with the reliability of electricity going to homes and businesses."
Maintenance at Plant Farley, Alabama Power's nuclear plant outside of Dothan, is "expensive but necessary," Dunn said.
More than 240 people died in Alabama as a result of the April 27 storms, which spawned 64 tornadoes.
(Source: Alabama Public Service Commission)
MONTGOMERY- Alabama Public Service Commission member Terry Dunn wants to attract more engineering talent to the PSC, the state agency that regulates public utilities such as Alabama Power Co. and Alagasco.
"We are fortunate to have strong accounting and auditing skills," Dunn said of the PSC staff. "I want to make sure we cultivate the engineering talent we need to complement our current strengths."
Dunn is working with Auburn's University's San Ginn College of Engineering to encourage juniors and seniors majoring in electrical engineering to consider doing an internship at the Public Service Commission.
"Auburn's College of Engineering is one of the best," Dunn said, "and we want to take advantage of that resource."
Students would be paid during the internships, which can be set up as full- or part-time temporary positions. Dunn said he hopes to have at least one or two engineering students workig at the PSC at any given time.
"Exposing them to the regulatory side of the electricity business may prompt some of them to pursue careers at the PSC," the commissioner said. "If not, the experience will be valuable to the students when they enter the work force in the private sector."
http://tinyurl.com/3hemolp
State officials are working to secure Federal Emergency Management Agency funds to remove tornado-related debris from Lake Neely Henry in Calhoun and St. Clair counties, as well as from Lake Martin in Elmore and Tallapoosa counties, according to Public Service Commissioner Terry Dunn.
Dunn, of Southside, said the PSC on Thursday provided necessary legal assurances to the governor’s office that the commission has no jurisdiction with respect to Alabama Power Co.’s dam operations on the lakes. That assurance was necessary in order to obtain the FEMA assistance, Dunn said.
The dams, along with the public waterways related to them, are regulated by the Federal Energy Regulatory Commission.
“Gov. Robert Bentley and his staff are working hard to ensure that Alabama obtains federal support in cleaning up the lakes,” Dunn said. “The Public Service Commission will continue to do all we can to support the debris removal.”
... http://tinyurl.com/3sukkdk
DUNN INVESTIGATING
Alabama Public Service Commission member Terry Dunn said the PSC is looking into whether federal funds can be used to offset Alabama Power Co. costs of fixing tornado-damaged transmission equipment.
“Early estimates of the cost to restore the system to pre-storm efficiency are approaching $280 million,” Dunn said. “We’re exploring every strategy possible, including temporary adjustments of PSC rules in order to provide more flexibility in the use of a disaster reserve fund.” Dunn said the PSC’s goal is to recover from the storm without adding costs to customers.
http://tinyurl.com/42p6o45
The fund for hearing impaired services is financed by a 15 cents-per-month surcharge imposed on land lines. (The Birmingham News file)
MONTGOMERY, Alabama -- A panel of state lawmakers on Thursday approved a plan to pay for Alabama's All Kids children's health insurance program next year by taking $30 million from a fund created to pay for telephone services for the deaf.
The fund finances a "dual party relay system" that lets deaf or hearing-impaired people use phones to communicate with others, and it pays for related programs.
The fund is financed by a 15 cents-per-month surcharge imposed on land-based phone lines. The surcharge raises more than $3 million a year. Spending on the system and related programs totals about $2 million a year. A surplus of just more than $30 million has built up over two decades.
House Bill 432 by Rep. Jay Love, R-Montgomery, would take almost all the surplus in the 2012 fiscal year by transferring $30 million to the Education Trust Fund, which next year would fund All Kids instead of the General Fund.
Love said the General Fund next year and in coming years likely won't be able to afford to pay $30 million a year for All Kids, which provides health insurance to teens and children whose families make too much money to qualify for Medicaid.
The Ways and Means-Education Committee of the state House of Representatives approved House Bill 432 by voice vote. The House could debate the proposal next week.
Love said the state education budget for next year, as approved Wednesday by his committee, depends on the $30 million transfer to balance. "These are tough times. We're trying to make the best of a really dire situation," he said. State Finance Director David Perry, Gov. Robert Bentley's top finance adviser, said $30 million taken from the relay system fund would pay for All Kids next year, and growth in taxes would cover the programs' cost in later years.
Public Service Commissioner Terry Dunn asked committee members not to raid the relay system fund.
"It is my responsibility to protect the ratepayers," Dunn said. "This surcharge was intended to help the deaf and blind. If it is not used for that purpose, then these funds should be refunded to ratepayers."
"Otherwise, these fees will have been collected under false pretenses, basically a backdoor tax," Dunn said.
John Garner, the PSC's chief legal counsel, said supporters of the dual party relay system had hoped its fund would grow enough so that interest and other earnings would pay for programs and the PSC could end the surcharge.
Garner said the number of landlines statewide is decreasing, and he warned that revenues in the future could fall below current program expenses. "Now, we'll probably have to raise the surcharge. Certainly, we'll have to keep the surcharge on."
Join the conversation, add a comment or email: dwhite@bhamnews.com
MONTGOMERY, Ala. — The state's utility regulatory board plans to approve new Alabama Power rates Tuesday that give a price break to businesses large and small if they help the state recover from the recession.
Public Service Commission member Terry Dunn worked with Alabama Power to develop the package. Commission members said it will complement business tax breaks being considered by the Legislature. Officials also hope it will lower Alabama's 9.3 percent unemployment rate by providing one more incentive for new businesses to locate in Alabama and for existing businesses to expand.
"Anything we can do to differentiate Alabama from its competitors in the economic development sphere is important, and I appreciate Alabama Power's willingness to work with us on this initiative," Dunn said.
Alabama Power spokesman Michael Sznajderman said the utility has long worked with state officials to recruit industries, and the new rates are an opportunity to help other smaller businesses grow and add jobs. "Obviously, there is a benefit for us if we can sell more electricity," he said.
The PSC's rate plan is in three parts.
One will expand the number of businesses that can qualify for small business rates by increasing the maximum demand from 15 kilowatts to 20 kilowatts. The PSC estimates nearly 8,000 small retail shops, investment businesses, real state offices and other types of businesses could qualify and could save an average of $316 per year. Alabama Power will work with the PSC to notify businesses that could qualify.
Another part will give a one-year rate discount to businesses that open in buildings that have been vacant for at least six months. The discount is 15 percent off of Alabama's base rate, which will amount to a discount of 10.5 percent to 12.5 percent off the total bill, depending on the type of business and the total usage, Sznajderman said.
The incentive could apply to a new business or an existing business that opens another location, and it will be offered through the end of 2012.
The third part of the package is aimed at larger companies that invest enough money and create enough jobs to qualify for the state's Capital Investment Tax Credits. The size of businesses that qualify for those tax credits depends on where they locate in the state, but any large manufacturing plant locating in Alabama or undergoing a major expansion would likely qualify.
The plan will give them a 10 percent discount off the base rate for the first year and 5 percent off in the second year. It will be offered through the end of 2013.
Lisa Parrish, spokeswoman for PSC President Lucy Baxley, said Baxley applauds Dunn for working out the plan and will support it Tuesday. "Lower electric bills combined with tax credits is a formula for business development and job growth," she said.
PSC member Twinkle Andress Cavanaugh said it will allow her to keep a campaign promise to help small businesses, and it supports what Gov. Robert Bentley is trying to do to foster the growth of small businesses. "It's very important because most Alabamians work for small businesses," she said.
MONTGOMERY — The state Public Service Commission is working with Alabama Power Co. to design incentives for small businesses to expand and add employees, Commissioner Terry Dunn said Monday.
Dunn said the state's utility regulatory board and the largest utility it regulates are talking about ways to offer discounts to small- and medium-size businesses that hire new employees or expand into vacant commercial property. The commission is also looking at expanding the number of firms that can qualify for Alabama Power's small business rates, he said.
Alabama Power spokesman Michael Sznajderman confirmed the discussions are under way with the commission, but nothing is definite yet.
"You might say it's an economic stimulus package for business," the spokesman said.
Dunn said anything that is worked out will have to be approved by the full three-member commission, and his goal is to have a plan in place by summer, when electricity use is usually highest. Dunn said it would enhance work by the governor and Legislature to create jobs and lower Alabama's 9.1 percent unemployment rate.
If the Alabama Power talks are successful, the commissioner said the PSC would have similar discussions with Alabama Gas Corp. and Mobile Gas Service Corp., two major suppliers of natural gas.
http://www2.oanow.com/news/2011/feb/28/alabama-psc-looks-job-creation-incentives-ar-1519765/
After Saturday, the Public Service Commission will no longer control rates for the landlines of Windstream, Gulf Telephone Co., CenturyLink and AT&T's BellSouth. The PSC will be reduced to regulating the rates of 26 small rural phone companies.
"In those areas, telephone service remains a monopoly, and we will be vigilant in protecting the interests of rural customers," Commissioner Terry Dunn said Thursday.
Deregulation began in 2005, when the Legislature passed a law that ended the PSC's ratemaking authority over much of the traditional landline business that large phone companies had in Alabama, including home phones with optional services, such as caller ID or call waiting.
The Legislature passed another deregulation bill in 2009 that ended the PSC's remaining control over basic landline phones for homes with no optional services and for businesses that had four phones or fewer. The Legislature delayed implementation until Jan. 1, 2011, and it applied the deregulation to larger companies in competitive markets.
At the time the law passed, AT&T estimated that 20 percent of its residential customers and 10 percent of its businesses customers were still regulated and would be affected by the change on Jan. 1, 2011.
AT&T spokesman Hood Harris said Thursday he didn't have updated figures, but few are affected by the change because most residential customers purchase optional features and were covered by the 2005 deregulation.
He said the state's largest telephone company pushed for deregulation to give it a level playing field with unregulated companies that sell phone service, including cable TV and Internet providers.
Dunn said the purpose of deregulation is to foster competition with unregulated phone providers and keep rates down. "We will be watching to see whether prices fall," he said Thursday.
AT&T's Hood could not predict what rates will do over the next year, but he said, "We still have to remain competitive in the market place."
PSC President Lucy Baxley, who opposed the 2009 law, said she remains concerned that deregulation is not in the best interest of consumers.
"I hope the competition among the various telephone companies will keep rates low for the consumer. I also hope in the end the big phone companies don't gobble up all smaller ones. We'll all just have to wait and see," she said.
http://blog.al.com/wire/2010/12/alabama_phone_deregulation_inc.html
Alabama Power rate increase delayed!!
12/7/2010 8:36:29 PM
MONTGOMERY, Ala. (AP) — Rate increases scheduled to take place Jan. 1 for Alabama Power customers are being delayed, and rates of Alabama Gas Corp. and Mobile Gas are being reduced.
The Public Service Commission announced Tuesday that Alabama Power had been entitled to a $7.5 million rate increase to offset expenses for complying with federal environmental rules, but the company has agreed to delay that increase until 2012.
The amount Alabama Power charges customers to cover its fuel costs was due to go up Jan. 1 after a temporary reduction, but the company has agreed not to increase the rate through March 31. Commissioner Terry Dunn said that should save consumers about $62 million.
Among other utilities, Alabama Gas Corp. will lower its residential rates 2.4 percent Jan. 1 and rates for Mobile Gas Service Corp. will go down about 2 percent.
Mobile Gas rates were due to drop under the formula the PSC uses for setting rates, but Alabama Gas agreed to a voluntary reduction.
Dunn said he had encouraged utilities to hold down rates until Alabama's economy recovers.
"Households and businesses in Alabama need all the help they can get during this recession," he said.
http://69.2.101.60/newsflash/index.ssf/story/alabama-power-rate-increase-delayed-3-months/dc936ac73d354f83bf9fb6e622e574c0
Dunn urges utilities to forgo rate hikes;
cuts now set to take effect Jan. 1, April!
Alabama's two largest gas distribution companies will lower their rates Jan. 1, Commissioner
Terry Dunn announced following Tuesday's monthly meeting of the Alabama Public Service
Commission.
Dunn, who met with executives from Alabama Gas Corp. and Mobile Gas Service Corp. a few
days after being sworn in as PSC commissioner on Nov. 3, urged both companies to reduce rates.
The Mobile Gas reduction totals slightly more than 2 percent from the previous month, or a
decrease of 5.5 percent compared with residential rates in effect in December 2009.
For Alagasco, the reduction totals 2.4 percent for residential customers compared with rates in
effect at the time of the cut. That translates to a decrease of8.7 percent compared with December
2009.
Alabama Power, meanwhile, though entitled to a $7.5 million increase to offset environmental
spending mandated by the federal government, has agreed to Dunn's request that the company
defer that cost recovery until at least 2012. By law, the PSC cannot prohibit the company from
recovering legitimate costs.
"By postponing the recovery ofthis federally mandated spending until 2012," the commissioner
said, "we will allow more time for the economy - and Alabama households' budgets - to
improve."
Dunn also persuaded Alabama Power not to contest an extension of the temporary reduction in
its fuel-cost recovery rate, which was set to expire at the end of this month. That lower rate will
now continue through March 31, the commissioner said,
during the coldest months of the winter."
Again, under state law, the PSC is required to allow utilities to recover the money they spend on
fuel- mostly natural gas and coal. Rates tied to fuel-cost recovery include no profit.
When the lower fuel-cost recovery rate expires at the end of March, it will return to a rate that is
0.5 mills lower than it was before the temporary reduction. That adjustment, which was also
negotiated by Dunn, will result in a decrease in power rates of approximately $62 million.
The commissioner, a native of Southside, near Gadsden, promised during his PSC election
campaign that he would meet with all of the principal utilities regulated by the agency within 30
days to work with them on ways to cut rates.
"Households and businesses in Alabama need all the help they can get during this recession,"
Dunn said. "We're going to do everything we can to keep the utilities rates as low as possible and
their service as reliable as possible."
See More
http://www.psc.state.al.us/EthicsPolicyRelease.pdf
www.psc.state.al.us
The Alabama Public Service Commission has approved new ethics rules that prohibit commission members and employees from soliciting or accepting a gift or a campaign contribution from a lobbyist representing a company regulated by the PSC.http://blog.al.com/wire/2010/11/alabama_psc_enacts_ethics/8001016/comments-2.html
Dunn sworn in to serve on PSC | GadsdenTimes.com
http://www.gadsdentimes.com/article/20101103/NEWS/101109929/1016/NEWS?Title=Dunn-sworn-in-to-serve-on-PSC
Associated Press - September 2, 2010 8:24 AM ET
MONTGOMERY, Ala. (AP) - Former George W. Bush political adviser Karl Rove has endorsed Republican Terry Dunn for the Alabama Public Service Commission.
Rove says Dunn is a businessman who would use his experience to help recruit jobs, and he would oppose cap and trade legislation because it would raise utility rates in Alabama.
Dunn says he's humbled by the endorsement. He faces Democratic incumbent Susan Parker in the general election Nov. 2.
Copyright 2010 The Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.
http://www.wtvm.com/Global/story.asp?S=13088178
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