Houston — Nuclear must be included with renewables as part of any serious effort to decarbonize US energy, Southern Co. Chairman, President and CEO Tom Fanning said during the company's annual meeting Wednesday, in response to shareholder questions about its commitment to clean energy and the cost of two new nuclear reactors.
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During the Q&A session, Fanning defended Southern's plan to shift to a low-carbon generation fleet and its renewables plans. While he agreed wind and solar should be part of the energy mix, Fanning said a diversified portfolio that considers renewables with nuclear and natural gas will help lower greenhouse gas emissions.
"If we ever want to see a no-carbon future, the United States must have nuclear," he told shareholders at the meeting in Pine Mountain, Georgia. "Nuclear must be part of the solution."
In April 2018, the Atlanta-headquartered utility holding company announced a goal to cut nearly all of its greenhouse gas emissions by 2050. Its short-term goal includes cutting 50% of its emissions across all operations by 2030 from 2007 levels. Among shareholder voting items for 2019, 94% supported approval for Fanning's 2019 incentive pay, which links a portion of his salary to the company's emission reduction goals for 2030 and 2050.
Fanning said the conversation spurred by the the Green New Deal proposal and the need to increase reliance on renewables and non-carbon-emitting sources has been helpful. But energy storage is not where it needs to be for the grid to rely on wind and solar, he added, citing fellow board member and former US Secretary of Energy Ernest Moniz's alternative "Green Real Deal" proposal that considers nuclear, natural gas and energy efficiency's role for reducing reliance on coal.
"Lithium-ion battery storage is not the answer. It's good up to a certain point, but it's not the answer," Fanning said. "It's not just renewables, even though renewables will be incredibly important."
The chief executive's comments come as Southern subsidiary Georgia Power and its project partners push to finish units 3 and 4 at the Alvin W. Vogtle Nuclear Plant plant after falling behind schedule and budget. Georgia Power is also facing calls from the Georgia Public Service Commission's staff and industry observers to consider going beyond the 1,000-MW of renewable capacity it plans to add as part of its 20-year integrated resource plan.
One shareholder questioned whether Southern subsidiaries like Georgia Power are doing enough to meet Southern's decarbonization goals, but Fanning asserted they are.
"Let the process work out," he said of Georgia Power's IRP.
In addition to Fanning's executive compensation, shareholders also voted on three other items. According to preliminary results announced at the meeting, 97% of shareholders voting supported re-electing 15 members of the board of directors, including Fanning. Shareholders also voted to ratify the appointment of Deloitte & Touche to be the company's independent registered account firm for 2019, with 99% of votes supporting the measure.
Shareholders did not approve an amendment to Southern's certificate of incorporation that would have reduced the supermajority vote requirement to a majority vote, with 61% of shareholder votes supporting the measure, though Southern's board of directors recommended voting for the proposal.
-- Ellen Meyers, S&P Global Market Intelligence, firstname.lastname@example.org
-- Edited by Gail Roberts, email@example.com