Workers’ rights groups forge deal with Southern Co. for Kemper plant

The Mississippi AFL-CIO and the Central Mississippi Building and Construction Trade Council have forged an agreement with Southern Co. that will have members from both organizations working on the Kemper County coal plant.

Mississippi Power Co., a subsidiary of Southern Co., is building the plant.

Neither the AFL-CIO’s Robert Shaffer nor the CMBCTC’s David Newell would give many details about the deal. Newell said the agreement is “to finish the project.”

They both urged the Sierra Club to drop their opposition to the project. The environmental advocacy group has long fought the coal plant, calling it dirty, expensive and unnecessary.

Tuesday morning’s announcement contrasts sharply with what Newell told the Mississippi Business Journal earlier this year. Newell said during the summer that Southern Co. had reneged on a similar deal, and that the plant was likely to be poorly built and well over budget because the company was not using his membership. Philadelphia-based Yates Construction Co. and Texas-based KBR, who were the project’s original contractors, took exception to that. Each said its history of delivering quality work on time and on budget was proof that it could do the same with the Kemper plant.

“I don’t know” what made Southern Co. reverse its position on dealing with the two organizations, Newell said. “Maybe they need our skills now more than ever.” Newell said the current deal had been in the works about three months.

Shaffer said the AFL-CIO had been in negotiations with Southern Co. since construction started on the plant in 2010. “You never know why corporations do certain things, because you’re dealing with so many different people, you never really know who’s pulling the strings,” he said.

Workers from both organizations are already on site. Shaffer said the number of workers would likely “start to build up pretty rapidly after the first of the year.” Newell said whether existing workers will have to join either the AFL-CIO or the CMBCTC “has not been decided yet.” It was also unclear how forcing them to would violate Mississippi’s right-to-work statute.

Independent monitors hired by the Mississippi Public Service Commission and the Public Utilities Staff have issued different estimates recently that put the cost of building the plant between $2.88 billion and $3.15 billion. A Mississippi Power spokesperson said last month that the company still expects the project to cost $2.88 billion or less. Public service commissioners have capped at $2.88 billion the costs Mississippi Power can pass to its ratepayers. Any pass-through costs above $2.4 billion must meet prudency requirements before commissioners will approve them.

Commissioners over the summer denied Mississippi Power’s request to raise rates about 13 percent to generate $58 million for the plant. Commissioners said then they would not consider anymore rate increase requests related to Kemper until the Mississippi Supreme Court had ruled on the latest round of litigation involving the company and the Sierra Club. A Harrison County chancellor is currently considering the issue. Whoever is on the losing end of that ruling will almost certainly appeal to the state’s high court.

The plant is scheduled to begin commercial operation in 2014.

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