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Completion of the power plant in Kemper County is more than three years behind schedule.

Regulators order end to Kemper rate increase, plan refunds

JACKSON — Regulators on Tuesday ordered Mississippi Power Co. to lower rates later this month and plan for customer refunds by November.

In issuing the order, the Mississippi Public Service Commission voted 3-0 to comply with a state Supreme Court order that found illegal a 2013 rate increase for the $6.2 billion plant.

The unit of Atlanta-based Southern Co. must roll back the 18 percent increase starting with the August billing cycle, which begins July 20. A residential customer using 1,000 kilowatt hours per month in electricity would see monthly bills fall to $121 from $144 currently. The average residential customer uses more power than that, and thus pays more.

With interest, about $350 million is due to the company’s 186,000 customers from Meridian to the Gulf Coast. Mississippi Power lawyer Ben Stone told commissioners Tuesday that a 1,000 kwh-a-month residential customer is due between $500 and $600.

Hattiesburg oilman Tommy Blanton, who’s running for the southern district PSC seat as a Democrat and brought the lawsuit, said he was pleased.

“This money was taken without authorization of law, it’s being held without authorization of law,” Blanton said. “My mother taught me that’s stealing.”

Commissioners ordered Mississippi Power to submit a refund plan within 14 days, giving customers a choice to either get a one-time check, or credits against future bills. Commissioners said they would vote on the refund plan on Aug. 6.

“Mississippi Power believes the safest and quickest method is by providing bill credits,” spokesman Jeff Shepard said in a statement. “This is safer than mailing checks to customers. If checks are issued it could take months for those to be verified, processed and mailed to customers.”

Tuesday’s order mandates that the plan provide for checks within 90 days. The company has already paid back a roughly $300 million deposit to the South Mississippi Electric Power Association after SMEPA dropped plans to buy a share of the Kemper plant.

Though Mississippi Power accounted separately for the Kemper rate money, it spent it. Tim Leljedal, a spokesman for Southern Co., said Mississippi Power could repay with cash or new borrowing. It could also get loans or sell stock to the parent company.

Northern district Commissioner Brandon Presley, a Nettleton Democrat, amended the order to demand some sort accounting to ensure people who are no longer customers get refunds.

“You’ve got folks who have moved, you’ve got folks who have passed away,” Presley said.

Rates could jump again only weeks after they fall. Mississippi Power says it will use state law to enact a rate increase on Sept. 12 if commissioners don’t approve one by then. Residential customers could see rates rise as high as $181 a month. Mississippi Power’s 186,000 customers from Meridian to the Gulf Coast would pay $273 million more in the first year and $395 million in the second year under one scenario.

Blanton said that he believed Mississippi Power’s new rate proposals were legally defective because the company hasn’t given adequate notice to every ratepayer as mandated by the Supreme Court, and because the plant is not yet fully operational.

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