Georgia Power’s pledged shift from coal-fired plants to clean energy jolted by data center growth

by Stanley Dunlap, Georgia Recorder
January 31, 2025

Georgia Power announced a long-term energy plan Friday that is already stirring controversy, requesting that state regulators approve major investments in fossil fuels, transmission lines, and other energy resources to meet the projected rapid growth of data centers.

Consumer advocates warn that existing ratepayers will shoulder much of the cost to accommodate the warehouses filled with computers and telecommunications equipment. And environmentalists complain the energy required to power the new technology is pushing Georgia Power to reverse course on its push to make progress on its clean energy goals.

This summer, the Georgia Public Service Commission is set to vote on the investor-owned utility’s 2025 long-term plan that outlines its proposed investment over two decades to provide electricity to its 2.7 million residential customers and growing industrial base. 

The state’s largest supplier of electricity says it plans to provide a varied mix of energy and the necessary infrastructure to build up its electrical grid to meet the state’s short- and long-term economic needs. 

According to Georgia Power’s projections, electrical load growth will be about 8,200 megawatts by 2030, representing an increase of more than 2,200 megawatts over the last Integrated Resource Plan update.

Several environmental organizations are criticizing Georgia Power’s plans to increase its reliance on fossil fuels like coal, gas, and oil. Additionally, over projections of industrial growth in the past have drawn concerns about more financial risks being placed on homeowners and other ratepayers.  

The long-range plan also seeks to extend the life of coal-burning plants in Bartow and Monroe counties, walking back previous plans to retire decades-old sources of air pollution at Plant Bowen and Plant Scherer.

Georgia Power’s 2025 plan also proposes at least 1,100 megawatts of new renewable resources, which will contribute to the company’s goal to expand its renewable energy by 11,000 megawatts by 2035.

“At Georgia Power, our vision extends far beyond today — we plan for tomorrow, the next ten years and decades to come,” said Kim Greene, chairman, president and CEO of Georgia Power. “As Georgia continues to grow, this state is well-positioned for the future thanks to proactive planning, policies, and processes like the Integrated Resource Plan. The 2025 IRP provides a comprehensive plan to support Georgia’s continued economic growth and serve Georgians with clean, safe, reliable and affordable energy well into the future.”

Since 2023, Georgia Power customers have endured half a dozen rate increases to cover base electric rates, recover excess fuel expenses, and complete two nuclear power generators at Plant Vogtle. In January, Georgia Power raised its rates by 3.5%, making the typical monthly household bill $43 more expensive since the beginning of 2023. 

Data center boom or bust?

The bulk of Georgia Power’s projected energy growth is tied to massive data centers to support the booming demand for artificial intelligence technology that drives internet search engines and other new software. In November, the company cited several dozen prospective companies expressing interest in opening massive data center facilities in Georgia, primarily around metro Atlanta. 

According to the U.S. Department of Energy, data centers consume 10 to 50 times as much electricity as the average commercial building. The data centers are also known to bring voracious water requirements to communities that bring them in. 

Southern Environmental Law Center senior attorney Jennifer Whitfield said Georgia Power is seeking to extend dirty coal-burning generators that will pose financial and environmental risks to ratepayers and people living in the communities surrounding the plants.

Coal “is not only an expensive and dirty fuel that Georgia Power didn’t even want a couple of years ago for some of these plants, but the data centers don’t want it either,” Whitfield said. “They want clean energy.”

Georgia Power says data center growth will cause electricity demands to triple in next decade

A new report from the Institute for Energy Economics and Financial Analysis shows that residential and legacy business ratepayers in Virginia, North Carolina, South Carolina and Georgia are subsidizing the costs of proposed electrical infrastructure that will only grow more expensive if it is overbuilt in anticipation of electricity demand that might not materialize. 

Cathy Kunkel, the energy consultant who authored the report, said the institute’s analysis raises concerns about utilities overestimating future energy demand for data centers. Data centers are often pitched in multiple states by technology companies, she said.

A gigawatt of power can be required to run large language AI computer models, according to Tim Lieuwen, executive director of the Strategic Energy Institute at Georgia Tech.

Georgia Power’s Plant McDonough produces a gigawatt of electricity, enough to power the city of Atlanta, he said.

Lieuwen said one of the major questions being asked in the technological industry is whether artificial intelligence is a risky economic bubble.  

“I don’t want to speak for the technology companies, but I think I can capture their point, which is, ‘we don’t care,’ because the risk of under-investing so dramatically outweighs the risk of over-investing,” he said. “We’ve got to build out these data centers so that we can source the power needed for the large language models so we don’t fall far behind.”

Kunkel expressed concerns about the potential for AI to be underutilized or abandoned if it turns out to be more energy-intensive than currently forecast. She said Georgia Power has missed the mark with inflated forecasted growth demands in past projections.   

“Maybe it’s better for the tech industry to overbuild in some way, but only because they’re passing the risk of that off to the ratepayers,” Kunkel said.

Georgia Power has successfully petitioned Georgia’s state regulatory commission to pass the cost of building out its transmission infrastructure to residential and legacy business customers.  

Last week, the five-member PSC unanimously approved a new Georgia Power plan to address risks associated with these large-load users. 

According to the rule, new customers using more than 100 megawatts of energy can be charged based on different conditions than standard customers. Data centers’ owners would be responsible for the transmission and distribution costs incurred by these large power users during construction. In addition, any new Georgia Power contract that exceeds 100 megawatts must be reviewed by the PSC.

“The amount of energy these new industries consume is staggering,” PSC Chairman Jason Shaw said in a statement. “By approving this new rule, the PSC is helping ensure that existing Georgia Power customers will be spared additional costs associated with adding these large-load customers to the grid.”

However, some environmentalists and consumer advocates warn that residential and business ratepayers may end up footing the bill if data companies never open in Georgia.

“We applaud the commission’s commitment to hold the line on customers’ bills, even in the face of the massive investments Georgia Power is requesting to serve this large load,” said Thomas Farmer, Southface Institute’s vice president of advocacy. “Residential and small business customers cannot be on the hook for unhealthy, expensive energy just to help Georgia Power profit from the data center boom.”

Georgia Recorder is part of States Newsroom, a nonprofit news network supported by grants and a coalition of donors as a 501c(3) public charity. Georgia Recorder maintains editorial independence. Contact Editor John McCosh for questions: info@georgiarecorder.com.

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