Cooperative raising rates due to Kemper plant costs

MERIDIAN — East Mississippi Electric Power Association is raising rates for some customers because of higher wholesale power rates charged by Mississippi Power Co. to cover the costs of its Kemper County power plant.

The Meridian-based electric cooperative says customers in Lauderdale, Clarke, Newton, Wayne and Jasper counties will see power rates rise by 9.3 percent starting with May bills.

EMEPA buys wholesale power for customers in those counties from Mississippi Power, a unit of Atlanta-based Southern Co. It buys wholesale power for its customers in Kemper, Winston and Attala counties from the Tennessee Valley Authority. EMEPA has about 37,000 customers.

The cooperative says bills will go up $10.80 per month for a customer who uses 1,000 kilowatt hours per month. Average Mississippi electric consumers use more electricity than that, federal figures show.

EMEPA officials said they challenged the rate increase with the Federal Energy Regulatory Commission. They also said the cooperative refinanced other debt to cut costs.

South Mississippi Electric Power Association, which supplies wholesale power to 11 other cooperatives in southern and western Mississippi, is buying 15 percent of the Kemper plant and has already passed some rate increases to its member cooperatives.

Bills are also going up for Mississippi Power’s 186,000 customers. The Public Service Commission approved a 15 percent rate increase in March, to be followed by a 3 percent rate increase in 2014. The higher rates will allow the company to start paying off debt related to what it calls Plant Ratcliffe even before it begins operations, scheduled for next year. Kemper’s overall costs are approaching $3.3 billion, when the $2.88 billion cost of the plant is combined with costs of the adjoining lignite mine and pipelines. The plant will take lignite, a form of soft coal, crush it and turn it into a gas before burning it to generate electricity. The plant is designed to strip out carbon dioxide and other hazardous gases from the gasified lignite.

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