Combined Cycle

Georgia Power files plan for future needs

ATLANTA, June 7, 2002 — Georgia Power is proposing to enter into long-term power agreements in order to meet the future electricity needs of its customers in Georgia, the company says in its Certification filing recently at the Georgia Public Service Commission (PSC).

The company’s filing request PSC certification for approximately 1,660 megawatts of capacity for use beginning June 1, 2005.

As part of its IRP, the company was required to seek bids for new generation capacity for the 2005 timeframe. The certification filing is part of an amended 2001 IRP filing that also includes an adjusted load forecast and the retirement of 11 older Georgia Power generating units at three plants.

The new electric capacity will come from two projects: a Southern Company combined cycle project to be developed at Plant McIntosh near Savannah, Ga., and a combined cycle plant, that begins commercial operation this summer, owned by Duke Energy North America in Murray County, Ga.

“We identified a capacity need for generation beginning in the year 2005 due to continued growth in the demand for electricity,” said Jeff Wallace, Georgia Power’s vice president of planning and pricing. “We have reviewed the numerous bids from the request for proposal process, and believe that these projects best suit the long-term economic and reliability needs of our customers.”

The Plant McIntosh project will consist of two 620-megawatt combined cycle generating units that are scheduled to be in service by June 1, 2005. These natural gas units are designed to achieve superior fuel efficiency. The combined cycle units achieve a high level of efficiency by using natural gas to generate electricity with combustion turbines and then using the waste heat to make steam that is used to make additional electricity. Savannah Electric will purchase 200 megawatts of the plant’s output with Georgia Power purchasing the remaining 1,040 megawatts.

Beginning June 1, 2005, Georgia Power will also buy 620 megawatts of power from the Murray County plant. That represents the total output of one combined cycle unit, or half of the plant’s current output.

“This certification request represents a continuation of the forward- looking planning process that the PSC has in place to ensure that there will be enough electricity available to meet Georgia’s demands in the future,” Wallace said. “The IRP is designed to ensure that Georgians have the power they need at the best price available.”

The amended IRP indicates a slight decrease in the peak demand forecast — which reflects the impacts of a slower economy. Other major assumptions, such as fuel costs and technology costs, have also been amended.

Additionally, the amended IRP will include the previously announced proposed retirement of 415 megawatts of generation from 11 units at Georgia Power Plants Arkwright, Atkinson and Mitchell. The proposed retirements are the result of a unit retirement analysis that Georgia Power is required to conduct as part of the IRP process. That analysis determined that the 11 units are more expensive to continue to operate when compared to the cost of replacement power.

Georgia Power is the largest subsidiary of Southern Co., one of the nation’s largest generators of electricity. The company is an investor-owned, tax-paying utility, serving customers in 57,000 of the state’s 59,000 square miles. Georgia Power’s rates are more than 15 percent below the national average and its 1.9 million customers are in all but six of Georgia’s 159 counties.