Legislation passed the Georgia General Assembly that would postpone the election of two Georgia Public Service Commission members until 2025. The elections were initially scheduled for 2022 but were delayed amid legal challenges over the state's electoral structure, which critics allege disenfranchises Black voters.
House Bill (H.B.) 1312 is awaiting the signature of Republican Gov. Brian Kemp. It remains unclear if Kemp will sign the measure into law or veto it.
➤ The Republican-majority Georgia General Assembly sent legislation to Gov. Brian Kemp to extend the terms of several commission members. All current members of the commission are Republicans.
➤ Two commission members have been serving pending the outcome of a legal challenge that postponed their elections that were scheduled for 2022. If the legislation is signed into law, those commissioners would serve until an election is held in 2025. Three other commission members would have terms extended to eight years versus the six authorized under current state statute.
➤ Regulatory Research Associates views Georgia's utility regulation as generally constructive from an investor standpoint. Georgia has not restructured its electric industry, and the most recent base rate case for the state's major electric utility, Georgia Power, was resolved via a settlement incorporating an equity return above the industry average at the time established.
The measure outlines the timetable for commissioner elections. It provides that the members in office as of Jan. 1, 2024, and any person appointed to fill a vacancy would serve the specific terms following an election. The purpose of H.B. 1312 is to preserve the continuation of future staggered elections for the commission members pending the outcome of a court decision.
Under the legislation, Commissioners Tim Echols, representing District 2, and Fitz Johnson, representing District 3, would stand for election the same day as the 2025 statewide municipal general election. A special primary election would be held June 17, 2025. The commissioner elected to District 2 would serve a five-year term beginning Jan. 1, 2026, and ending Dec. 31, 2030. The commissioner elected in District 3 would serve a one-year term beginning Jan. 1, 2026, and ending Dec. 31, 2026.
Echols, the PSC vice chair, was elected to the commission in 2010 and reelected in 2016. The extension of his election means he would serve an eight-year term. Under current state statute, commissioners are elected to six-year terms in statewide elections.
In 2021, Kemp appointed Johnson the District 3 commissioner on the PSC, filling the vacancy created by then-Chairman Chuck Eaton's appointment to the Atlanta Judicial Circuit. Since Johnson was appointed to the commission to fill a vacancy, he was initially required to run in a special election to serve the remainder of the term, which expires in December 2024. The term specified in H.B. 1312 for the District 3 seat would allow the seat to be up for election again in 2026.
Former PSC Chair Tricia Pridemore, whose current term expires at the end of 2024, would see her term extended until 2026, serving for eight years under the legislation. The commissioner elected to Pridemore's district, District 5, would serve a six-year term beginning Jan. 1, 2027, and ending Dec. 31, 2032.
Chair Jason Shaw, representing District 1, and Commissioner Lauren "Bubba" McDonald, representing District 4, serve terms scheduled for election in 2026; however, under H.B. 1312, they would serve until 2028. Their positions would then revert to six-year terms beginning Jan. 1, 2029, and extending until Dec. 31, 2034.
All members of the PSC are Republicans.
Legal challenges postpone elections
In 2020, Black voters filed a federal lawsuit asserting that the method through which PSC members are elected illegally diluted minority voting strength, violating the federal Voting Rights Act. Georgia is one of 12 jurisdictions where voters elect members of the regulatory body; however, its current hybrid method, where members must live in certain PSC districts but are elected statewide, is the only one of its kind among commission elections.
A US District Court judge postponed the elections Aug. 5, 2022, ruling that the state's electoral structure disenfranchised Black voters and required the state General Assembly to revise how the PSC commissioners are elected. However, on Aug. 12, 2022, the US Court of Appeals for the 11th Circuit reversed that decision, pending the state's appeal of that earlier ruling. The US Supreme Court later vacated that appeals court ruling. As a result, the two commissioner elections scheduled to take place during the November 2022 election did not occur, and plans for a special election in 2023 did not materialize.
On Nov. 24, 2023, the 11th Circuit Court reversed the lower court's decision, allowing the current electoral method to stand. However, the circuit court never finalized its ruling, effectively leaving the case unresolved. Reports have indicated that by withholding an official ruling, the circuit court could reconsider the ruling or rehear the case before the full appeals court. This action means that the district court's ruling invalidating the electoral method is still in effect. If a final ruling is issued, the plaintiffs in the case may appeal the decision to the US Supreme Court.
Georgia Secretary of State Brad Raffensperger confirmed March 5 that the 2024 PSC elections would be postponed indefinitely. Pridemore's commissioner term, originally set for the November ballot, and the special elections for Echols' and Johnson's terms have been taken off the ballot for this year's election.
Regardless of the outcome of any court decision, elections must be held for the commission since the state's constitution specifies that the government body is an elected body. Even if the court ultimately agrees with the lower district court's ruling, lawmakers could not significantly alter the selection method, such as making commissioner's governor appointees, without placing the issue up for a vote before the voters. Therefore, H.B. 1312 would serve as a road map for when the commissioners would be elected.
A separate lawsuit challenging the redistricting and residency requirements was filed in 2022 following the enactment of Senate Bill 472. The legislation redrew the five Georgia Public Service Commission election districts, essentially rendering the Democrat candidate for the District 2 seats ineligible to run after already being qualified. Raffensperger then disqualified the candidate from the race; however, a Fulton County Superior Court judge blocked the decision and ordered the candidate be reinstated on the ballot, pending a later court decision.
The judge later issued a decision reversing Raffensperger's decision to disqualify the Democratic candidate, stating that the residency requirement was unconstitutionally applied in this case. While commission regulators are elected in statewide elections, each candidate must be a resident of a specific Public Service Commission district for a year prior to the general election.
In recent years, a broad trend of shrinking margins between the two leading political parties has emerged across Georgia's local, state and federal elections. Georgia is one of two states that requires a runoff election if certain statewide candidates fail to secure at least 50% of the vote in a general election. In the past 20 years, four of the last 17 Georgia PSC elections have resulted in a runoff race. Districts 3 and 4 have seen the most runoff elections in the past two decades.
Flip elections occurred in two runoff races, where the candidate who secured the most votes in the initial election lost in the runoff elections. Historically, runoff elections tend to produce low voter turnout, and a majority of the runoffs saw voter turnout decrease by relatively high double-digit margins.
A flip election occurred during the 2006 PSC election, in which then-incumbent Democrat candidate David Burgess received more votes in the general election but lost to Republican Chuck Eaton in the runoff even though Burgess secured a majority of votes in the counties that comprised District 3 at the time.
Ga. regulatory environment
Georgia utility regulation is quite constructive from an investor viewpoint, as it has been for several years. Georgia has not restructured its electric industry, and the most recent base rate case for the state's major electric utility, Georgia Power, was resolved via a settlement incorporating an equity return above the industry average at the time established. The settlement included a multiyear return-based alternative regulation plan that provides the opportunity for additional earnings retention.
The PSC relies on average rate bases, and electric and natural gas rate case test years must be at least partially forecast at the time of decision. Georgia has been supportive of new nuclear-generating plant construction, and utilities are permitted to earn a cash return on construction work in progress associated with new nuclear facilities that have been certified by the PSC. Support has continued despite cost overruns that have been experienced in the ongoing construction of two nuclear units at the Vogtle nuclear plant. Electric fuel costs are recovered through a non-automatic adjustment mechanism.
Retail competition in the gas industry was implemented several years ago per state law, which provided the incumbent providers an opportunity to recover stranded costs and be insulated from commodity market risk.
The commission recently concluded a high-profile proceeding involving the prudency of costs borne by Southern Co. subsidiary Georgia Power Co. related to the Vogtle nuclear plant expansion, rolling a good portion of remaining project costs into base rates for Georgia Power. Georgia Power's most recent rate case concluded Dec. 20, 2022, when the PSC voted 4-1 to approve a settlement authorizing the utility a multiyear electric rate increase of nearly $1 billion.
Regulatory Research Associates affords Georgia energy utility regulation an Above Average/2 ranking. For more, refer to the commission profile page.
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