(Georgia Recorder) — The Georgia Supreme Court heard arguments Tuesday in a dispute over a large manufacturer’s decision to choose Walton Electric Membership Corp. as its electricity supplier over Georgia Power.
The state’s highest court is expected to rule in the coming months on the case that centers around Georgia Power claiming that it had “grandfather rights” under the Georgia Territorial Electric Service Act to continue providing electricity to the refurbished Hartwell Nestlé Purina PetCare Co. that makes cat food.
The state Supreme Court agreed to take up the case to reconsider decisions the Fulton County Superior Court and the Court of Appeals of Georgia issued against the Georgia Public Service Commission’s decision to deny Georgia Power’s request to block Walton EMC from providing electricity to the Hartwell Nestlé Purina facility.
The Georgia Territorial Electric Service Act in 1973 introduced some retail competition in a market dominated by Georgia Power that enables certain sized manufacturing or commercial businesses customers a one-time choice in their electric supplier.
The Georgia PSC regulates investor-owned Georgia Power, which supplies 2.7 million customers. The five-member state commission has limited regulatory authority over more than 90 EMCs and municipally-owned electric systems.
Nestlé informed Walton in 2019 that the company would use its electrical services, and in April 2019, Georgia Power filed a complaint with the PSC alleging that Walton violated the Territorial Act by serving the same premises that had been served by Georgia Power since 1991.
According to Walton EMC’s attorney, David Cook, the company’s conversion of a former towel manufacturer’s facility into a cat food factory was more than enough to satisfy the state’s customer choice provision for utility service. Cook said the rule has been appropriately applied by the PSC for several decades.
“The Territorial Acts customer choice provision applies to pre-existing ones that are reconstructed, not in substantial kind,” Cook said. “We also request this court to hold that to satisfy that customer choice provision, a large load customer need not completely demolish the premises because the satisfaction of the customer choice provision is a matter of degree.”
Justices Carla Wong McMillian and Charles J. Bethel questioned Georgia Power attorney Thomas Reilly about why he disagreed with the PSC’s findings that Nestle company’s several hundred million investment into refurbishing the facility shouldn’t be considered a “new premises.”
According to Reilly, the lower courts properly gave Georgia Power the chance to exercise its right to continue providing electricity to the same location where it had previously done so for years prior.
“The lower court should be affirmed because the Public Service Commission improperly divested Georgia Power of its exclusive right to continue serving the Hartwell premise in violation of terms of the Territorial Act,” Reilly said.
Reilly was peppered by Bethel with a line of questions about the substantial modifications made to the building under Nestlé Purina.
“So Georgia Power’s contention is that the cat food manufacturing facility was reconstructed in substantial kind with the predecessor towel manufacturing facility,” Bethel said.“Are the wombs that the towel manufacturer presumably used to weave towels still in operation?”
“No sir,” Reilly said.
“Are the boilers that fed the presumable bleaching and dying operations still in operation?” Bethel asked.
“They are not,” Reilly said.
“What about the cutting and stitching machines that a towel manufacturer would have to have,” Bethel asked.
“No,” answered Reilly.
“If something is gutted, like wiped out, all of the old equipment that used your power is taken out of the facility and new equipment that makes a totally different product… I get your argument, but I don’t understand how we think that matches up with the in-substantial kind (investment).” Bethel said.
