The Georgia Public Service Commission (PSC) Tuesday approved a settlement proposal that removes a stumbling block from Georgia Power’s plans to build a 19-mile natural gas pipeline through the suburban metropolitan area just west of Atlanta.

Under terms of the agreement, Georgia Power will pay the city of East Point $128,000 for pipeline inspections and maintenance and to train municipal employees to respond to pipeline emergencies. In return, East Point agreed to end its legal opposition to the 30-inch diameter pipeline.

The pipeline will connect an interstate pipeline near Union City to gas-powered electricity generators planned at Georgia Power’s Plant Jack McDonough near Smyrna. Georgia Power plans to run most of the pipeline beneath its own existing electric transmission lines.

East Point had led opposition to the pipeline beginning at the end of 2006, after a Georgia Power surveyor who was performing field work for the planned — but not yet announced — East Point pipeline project was spotted by homeowners near the transmission lines. Georgia Power, which had considered a total of five possible routes for the pipeline, did not announce until March that it had selected the East Point route.

Georgia Power, the only regulated electric utility in the state, is the largest subsidiary of Southern Company. In February, Southern Company Services, a Southern Company affiliate, reached an agreement with El Paso Corp. to expand the system capacity of El Paso subsidiary Southern Natural Gas by up to 367 MMcf/d to serve a new natural gas-fired generation facility at Plant Jack McDonough (see Daily GPI, Feb. 6). Plant Jack McDonough is currently composed of two coal-fired units totaling about 540 MW. Georgia Power has proposed the retirement of the coal-fired units and the construction of three gas-fired units of about 800 MW each. The company recently demolished a 1940s-era coal plant, Plant Atkinson, at the same site. Georgia Power has said replacing the coal-fired unit with more efficient natural gas-fueled generating unit will be more cost effective and produce cleaner energy than retrofitting the current coal unit with environmental controls.

Georgia Power said construction is expected to begin on the first gas unit in 2008. This unit is scheduled to be online late in 2010, and the total project should be completed by 2012.

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