New Leadership Signals Trouble Ahead for Plant Washington

Guest Blog | November 22, 2011 | Coal, Energy Efficiency, Energy Policy, Utilities

reality-check-ahead-signBoard of Director elections held Saturday, November 12 at Cobb EMC raised the profile of member dissatisfaction with the Atlanta-area utility co-op’s decision-making and leadership to a new level. New board members swept all four seats in the election by huge margins and will be sworn in at today’s Cobb EMC board meeting (Nov. 22, 2011). These new Directors are committed to transparency, honesty, and a forensic audit.

Now the dubious plan to build two new coal plants in Georgia could finally receive the scrutiny needed to spell the beginning of the end for these misguided projects. SACE believes that honest, fiscally responsible board members will quickly see how imprudent Cobb EMC’s involvement in the coal plants is, just as soon as they dig a little deeper.

coalplant-thumb1Cobb EMC is the leading member of Power4Georgians (P4G), a consortium of five Georgia utility co-ops that plans to build two new 850 MW coal-fired power plants in Georgia: Plant Washington and Plant Ben Hill. Cobb EMC has been plagued by scandal since at least 2007, including a lawsuit by its members alleging financial malfeasance, and the indictment of its former President and CEO on charges of racketeering, theft, lying, and intimidating witnesses. A revised state air permit for Plant Washington was just released on November 21, signaling the state’s unfortunate continued support in dirty energy decisions, but given the proposal’s origins, deeper concerns remain about its viability.

Many believe that the coal plant proposals are symptoms of alleged corruption at Cobb EMC. Now-indicted ex-CEO Dwight Brown helped create Power4Georgians. Court testimony revealed that former Cobb Energy subsidiary Allied Energy Services received a no-bid contract from P4G to build the plants despite never having built a coal plant before. Allied’s lead man, Dean Alford, was a Vice President at Cobb Energy, and Dwight Brown let him keep his job even though the subsidiaries he oversaw lost about $11 million between 2002 and 2007, according to Cobb Energy financial statements. With new leadership, we can expect some light to be shed on who’s behind this proposal, and why it moved forward in the first place.

Plant Washington became a campaign issue as candidates raised questions about the opacity of the project’s financial details. Most of the new board members expressed doubts during their campaigns about the prudence of such an investment, and promised to re-evaluate the plant. As a candidate, newly-elected board member Malcolm Swanson told readers of the Marietta Daily Journal:

malcolm-swanson_small1“I have a lot of questions about the coal-fired plant. Due to the lack of transparency, we are left in the dark about several things we should know about the plant. Who is going to own the plant and what is the obligation of Cobb EMC? What is the cost of building the plant? Are the possibilities of new regulations going to make the costs skyrocket? Our EMC has never been in the power generation business and is this the direction we want our EMC to go? The answers to these questions are integral to determining whether I favor this proposition or not.”

New Board member David Tennant, an energy consultant, seconded Swanson’s concern about why Cobb EMC, chartered to deliver electricity, not generate it, would take member money into a riskier field.

david-tennant“I believe that the EMC’s primary duty is to distribute electricity. Cobb EMC has no experience in the ownership or operation of this type of facility. The EMC should purchase power at wholesale from the appropriate generators (those that have experience in this area) and then distribute this power.” He continued: “The Plant Washington project needs to be reviewed from a cost, permitting, performance and operating basis. I also have questions about who is designing and building this plant. I would need to have these questions answered in great detail before I could support this project.”

The rest of Cobb EMC’s board of director seats are coming up for election in February and May, 2012. They will offer two more chances to ensure that strong leadership joins these newly elected board members in holding the EMC accountable for sound energy investments in the best interests of the members. Meanwhile, SACE and our legal allies will be evaluating the new permit and taking action as appropriate.

We congratulate the new board members and look forward to working with them on responsible energy decisions!

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