Economic Impact

New Industry

Poor air quality affects our local economy and our public health (especially the health of our children and the elderly.) Jefferson County’s air quality is designated by the EPA as being in non attainment with regard to air pollution. Until we clean our air, certain new industries cannot move into our community. The Jefferson County Health Department estimates our area has lost 15 manufacturing businesses (including the Mercedes plant) and $5 billion dollars in economic investments because of our non attainment status. In addition, there are hidden costs associated with the toll poor air quality takes on our public health including:

  • The costs to the health-care system.
  • The cost of lost productivity and absenteeism in the workplace and schools as a result of exposure on “bad air” days.
  • The economic damages of premature death.
  • The economic value of the pain and suffering of those who are ill.

A recent study by the National Academy of Sciences  estimates that the hidden costs of burning fossil fuels is costing our country up to $120 billion per year.

In addition, EPA estimates that when the new standards for ozone are put into place, our nation will save between $13 million and $100 million (determined by the final standard) by reducing premature deaths, hospital and emergency room visits, missed school and work days due to illnesses associated from exposure to ozone.

 

Your Electricity Bill

This summary is from an Arise Citizens’ Policy Project report,”Public Utility Regulation Without the Public:  The Alabama Public Service Commission and Alabama Power”. Read a full version of the report here.

There has not been a public rate case for the Alabama Power Company (“Alabama Power” or “the

Twinkle's PSC: Puppet Service Commission (JD Crowe, al.com)

Twinkle’s PSC: Puppet Service Commission (JD Crowe, al.com)

Company”) in 30 years. Instead, the Alabama Public Service Commission (“PSC” or “the Commission”) has a regulatory process that allows Alabama Power to adjust its charges each year without any public evidentiary hearings and, indeed, without any participation by rate paying consumers whatsoever other than off-the-record and after-the-fact comments at an informal hearing that completely lacks public transparency. In fact, the evidence is clear that the PSC specifically adopted this extreme rate-making process in the ’80s in order to protect Alabama Power from having to file for rate increases (as utilities in other states do) and to shield the process from public involvement and scrutiny. Moreover, the Alabama PSC allows Alabama Power to earn a rate of return of between 13.0 percent and 14.5 percent on the common stock investment made by its sole owner, the Southern Company. This return on equity range is significantly higher than other commissions around the nation allow their utilities to earn. For example, the average return on equity earned by utility operating companies like Alabama Power during the years 2008-2011 was only 9.40 percent or nearly 30 percent below the 13.27 percent return on equity earned by Alabama Power under the formula rate process followed by the Alabama Public Service Commission.

Only two other states with privately owned utilities have similar regulatory processes for electric utilities, Louisiana and Mississippi. However, in these states, unlike Alabama, there are meaningful opportunities for public involvement and ratepayer participation before major rate increases are approved.

 

Economic Costs of Coal

Electricity is vital to the modern world, and coal is the largest provider in the United States. The state of Alabama ElectricMeterrelies on coal for 36% of its electricity, more than any other source. We all want to pay as little as possible for our electricity, but it’s time we really examined the true cost of coal.

The human cost is the most devastating. As of 2011, the American Lung Association’s study of power plant air pollution  estimated a yearly death toll of 13,000. Coal-fired plants are by far the worst, spewing tons of pollutants into our air and water supply.  These plants are cause more air pollution than any other industrial source. The particles released from burning from coal are a major contributor in asthma and other lung related diseases, cutting lives short or subjecting the residents in the area to years of poor health and hospital bills.

To bring it closer to home, in this June 2012 article on al.com, Thomas Spencer outlines the cost of just one coal-powered plant in Greene County, AL in terms of human life. One plant in a fairly sparsely populated area that few people travel to is responsible for 49-100 premature deaths a year! This plant, like too many statewide, lacks controls for pollution that have become standard for cleaning our air.

Electricity from coal might lower your power bill. In the long run, it is never a bargain. Alabama needs to wake up and realize what we’re really paying for coal.

The following excerpt is from the executive summary of the Union of Concerned Scientists’ Report “Ripe for Retirement: The Case for Closing America’s Costliest Coal Plants”.  Read a full version of the report here.