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Kemper plant: Yes or no?

May 4th, 2010

The state Public Service Commission issued an order April 29 approving Mississippi Power Company’s $2.4 billion Kemper County clean coal plant – with conditions attached.

But Mississippi Power says the Commission has said no to the plant.

And at least two media outlets published erroneous stories saying the company has decided not to build the plant, while the Mississippi Business Journal correctly reported that MPC was mulling its options. And today a company official said MPC will file for a rehearing tomorrow.

How can such simple information be so complicated?

Central District Commissioner Lynn Posey said in an interview that the Commission had indeed approved the plant in its order, although he wished the conditions had been more lax. “I’m very much for the plant, and hopefully we can get that done,” Posey said.

MPC officials call attention to the Commission’s 50-page order on the plant which says the plant does not pass the state’s test for a certificate of public convenience and necessity but “explains how MPC can obtain Commission approval of its Petition.”

“It is very clear that the Commission found that the Kemper request did not warrant a certificate of public convenience and necessity. On page 48 of the Order in the FINDINGS paragraph, they describe the condition as being able to ensure that the ‘certificate, if granted, is consistent with the statute’s ‘public convenience and necessity’ test.’ The words ‘if granted obviously states that a certificate was not granted. Also, on page 49, the Commission expressly states that if Mississippi Power agrees to all the conditions, it will issue an order, certainly stating that they have not issued an order to date,” said Todd Terrell, company director of corporate communications, in a statement.

After April 29 Commission decision, MPC spokesperson Cindy Duvall issued this statement:

The Mississippi Public Service Commission denied Mississippi Power permission to construct the Kemper County IGCC Project.  (See p. 2 of today’s Order, Overview Section)

If the Company agrees with certain conditions within the next 20 days, then the Commission will consider whether the Company should be granted permission to proceed with the project.

The Commission conditions seem to make it impossible for Mississippi Power to finance or construct the Kemper County IGCC Project even if the right to construct had been – or might in the future – be allowed.

We are disappointed in this decision.

We put forth the best option available to us to meet our customers’ needs with reliable and affordable energy.”

The Clarion-Ledger published an Associated Press story with the headline “Utility nixes Kemper Co. plant,” and Bloomberg Businessweek said “Mississippi Power will not build coal-fired plant.” Along with the Mississippi Business Journal, Reuters got it right: “Mississippi Power ‘disappointed’ in state ruling.”

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