Our Energy Crisis

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Our Energy Crisis

• Presented by

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• 1.4 billion generation and transmission
  cooperative
• 16th largest privately-owned business in Alabama
• 560 employees
• Generating capacity of more than 1,600 megawatts
• 2,223 miles of transmission lines
• 284 substations
• AEC distribution members have on average 65
  employees each and serve about 20,000 consumers
  on 2,500 miles of line

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PowerSouth Generation Resources
Total Capacity 1,600 Megawatts
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Increasing U.S. demand for electricity
Source Energy Information Administration 2007
Annual Energy Outlook
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Our Current Energy Situation

• The atmosphere around energy policy is
  politically charged as polarized positions
  dominate the debate
• Today, Americans are sensitive to global climate
  issues
• The availability of affordable, reliable power
  has never been more in doubt
• Finding a balance in meeting energy needs and
  climate goals must be a priority

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Where does PowerSouth's electricity come from?

• Coal, Natural Gas, Fuel Oil, Hydroelectricity,
  Biomass

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What affects coal costs?

• World demand
• Reduced movementsto increase supply
• Higher transportationcosts

Charles R. Lowman Power Plant
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What affects natural gas costs?

• Limited supply
• Increased demand
• Government policies encourage use but limit
  access

James A. Vann, Jr. Power Plant
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How much has the price of natural gas increased?
Nymex Natural Gas 12-Month Strip
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US Power Generating Capacity Additions, 19502006
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What About Renewables?

• Increase national security by reducing dependence
  on foreign fuels, mainly oil
• Reduce our impact on the environment even
  positive outcomes foreseen
• Renewables
• Solar
• Wind
• Geothermal
• Biomass
• Nuclear (no carbon emissions)

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Insufficient wind speed to support wind power
in AEC service territory
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Insufficient insolation to support PV and solar
in PowerSouth service territory
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Renewable Power as a Potential PowerGeneration
Resource for PowerSouth

• Annual load growth is significant.
• Biomass generation is a possibility but limited.
• Confined to major timber areas.
• 100 MW per 50-70 mile radius.
• Wind generation will not work in Southeast
• Solar power is expensive for our area (lack of
  direct sun)
• Landfill gas potential is not significant
• Expertise in gathering and burning landfill gas
• Resources are thin
• If 3rd parties develop, PowerSouth is willing
  and required
• to buy the power.
• -Hydro power resources are fully mature.
• Geothermal resources for power generation are in
  the West.

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Challenges and Opportunities

• To meet future demand we must
• Figure out how to capture and store carbon
  dioxide from power plants- Congress must provide
  funding for carbon capture research and
  development
• Increase our reliance on nuclear energy
• Increase energy generation from renewable energy
  sources
• Restrain the rate of demand growth through energy
  efficiency and energy conservation

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Together, we can make a difference

• What were doing
• Partnerships with other cooperatives
• Fuel diversity
• Advance purchases of fuel
• Hedging
• Long-term contracts

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Together, we can make a difference

• What you can do
• Energy Star appliances
• Wise energy use
• Energy conservation

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Questions