Coal plant awaits state supreme court hearing
by MBJ Staff
Published: December 29,2012
The past year has been an eventful one for Mississippi Power Co.’s Kemper County coal plant.
In March, the Mississippi Supreme Court ruled that the 2010 order the Mississippi Public Service Commission issued that granted the plant a certificate of pubic convenience and necessity did not cite sufficient evidence from the record of proceedings.
Justices, in their ruling, kicked the issue back to the PSC. Commissioners, with Northern District Commissioner Brandon Presley opposing, reissued an interim certificate before eventually reissuing a permanent one in the early summer.
The Sierra Club continues its legal assault on the plant, with the latest news arriving just before Christmas, when a Harrison County chancery judge affirmed the PSC’s latest certificate. The Sierra Club announced its intention to appeal that ruling almost immediately afterward. The environmental advocacy group has long argued that the plant is dirty, expensive and unnecessary.
The Mississippi Supreme Court will get a chance to hear the issue again next year.
And when that court has its say is when the PSC will entertain rate increase requests related to the plant. In an unexpected move over the summer, commissioners voted 3-0 to deny a 13 percent rate increase request Mississippi Power made that would have generated about $58 million for the facility.
As part of that ruling, commissioners decided they would not hear any rate increase requests related to the plant until the state’s high court had its say on the latest round of litigation.
Rate increase estimates attached to the plant have varied. Documents Mississippi Power filed with the commission in 2009 said rates would go up an average of 45 percent. In the order granting the second certificate, commissioners said rate increases would peak at 33 percent before going back down.
Mississippi Power CEO Ed Day said earlier this year that the sale of the plant’s by-products would generate more revenue than originally anticipated, keeping rate increases under 30 percent.
The company also reaffirmed in early December the plant’s $2.88 billion cost. Cost estimates set by two sets of monitors hired by the PSC and the Public Utilities Staff have varied, with one group putting the cost between $3 billion and $3.15 billion and another putting it right at $2.88 billion. The last figure is the hard cap commissioners set on the project.
The $2.88 billion plant is scheduled to begin operation in May 2014.
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