Archive

Archive for the ‘Mississippi Power Company’ Category

Miss. Power seeks permission to recoup from ratepayers $45,000 payment to MEI

August 29th, 2013 No comments

Mississippi Power Co. filed as part of its most recent list of business expenses a $45,000 payment to the Mississippi Energy Institute.

Utilities routinely file the expenses with the Mississippi Public Service Commission, asking regulators to allow them to include the expenses in their rate base. That would essentially pass them on to ratepayers.

Northern District Public Service Commissioner Brandon Presley said in an interview Thursday morning that Mississippi Power Co. should not be allowed to recoup from ratepayers the payment to MEI. “It’s ridiculous they’d include that,” he said of the payment. The MEI, an energy policy think tank, is one of the primary supporters of a plan to store and transport nuclear waste in Mississippi. Presley has spent the past week opposing the plan.

Jeff Franklin, Mississippi Power’s VP of customer service organization, sits on MEI’s board of directors.

Presley said MEI’s support of the nuclear storage proposal amounted more to lobbying than developing energy policy. He said he plans to try to exclude the payment from the utility’s rate calculations at the PSC’s Sept. 10 meeting. He added that state law prohibits lobbying fees from being included in utilities’ customer rates.

Mississippi Power spokesman Keith Guillot  said in an email Thursday afternoon that utility officials “believe our contribution to MEI is consistent with the purpose of furthering economic development.”

No public money funding Bigger Pie, organization claims

August 21st, 2013 No comments

Biggie Pie Forum says accusations by an Alabama-based organization that the Kemper opponent has been funded with public money are false.

Patrick Cagle, the executive director of JobKeeper Alliance, wrote Aug. 16 in an editorial for the Clarion-Ledger that Biggie Pie’s funds came from the mothballed Institute for Technology Development, a nonprofit corporation formed in 1983 to promote economic development. Cagle claimed that more than $32 million in public money had gone to Bigger Pie via the ITD.

A Bigger Pie press release issued Tuesday denied those claims, saying money received by ITD had been generated via research contracts with federal agencies and private parties. Bigger Pie claims ITD money – which it claims is not public – has been spent appropriately, and monitored by independent auditors and accountants.

“All of (JobKeeper’s) claims are blatantly false and are reckless and irresponsible attempts to quiet opposition to the Kemper Power Plant through intimidation and by misleading the public and public officials,” Bigger pie says in its release.

ITD, the Bigger Pie release says, also generated money via the development and commercialization of technology related to microelectronics, space remote sensing and infrared sensing.

Bigger Pie was formed in 2012 as a Mississippi LLC. Its mission is to promote economic development, although its most public image has been that of the chief opponent of Mississippi Power Co.’s Kemper County coal plant. Bigger Pie has claimed the facility relies on unproven technology, and is an unfair economic burden on the utility’s 190,000 ratepayers.

JobKeeper is a business-labor cooperative based in Montgomery, Ala. It was formed in 2011 to, according to its website, promote new jobs and keep existing jobs.

PSC tenure done, Bentz starts new role at SMPDD

August 20th, 2013 No comments

Leonard Bentz resigned from the Mississippi Public Service Commission at 7:59 a.m. Monday.

He officially started his new job as the executive director of the South Mississippi Planning and Development District one minute later. Bentz confirmed the transition Tuesday morning.

“We had economic development meetings (Monday) and I’m on my way to Jackson now to meet with the Division of Medicaid,” he said in a phone interview. “We’ve hit the ground running.”

Bentz’ last meeting with the PSC was Aug. 13. He said afterward that he was comfortable with his decisions regarding Mississippi Power Co.’s Kemper County coal plant. He said then he hopes his successor will adhere to the agreement between regulators and the utility that holds the plant-related costs ratepayers will have to bear to $2.4 billion.

“I own Kemper,” he said then. “I believe it is the right thing to do.”

Bentz’ staff remains in place, he said, and will continue to operate the Southern District PSC office. The PSC will meet again Sept. 10. Ideally, a replacement will be named by then, but it’s not imperative that happen, Bentz said. Gov. Phil Bryant will appoint Bentz’ replacement. Bryant’s spokesperson Mick Bullock said in an email Tuesday morning that he wouldn’t speculate on a timetable for filling the post.

“The sooner the better, obviously, but I don’t think there will be any decisions that are pertinent at that meeting, but it would be nice,” Bentz said Tuesday. “Otherwise, it’ll be business as usual at my old office. My former chief of staff and the rest of the people there have been with the PSC a long time and are very capable of doing what needs to be done.”

Supreme Court revises Kemper litigation briefing schedule

July 16th, 2013 No comments

In an order Tuesday, the Mississippi Supreme Court changed the briefing schedule for attorneys involved in litigation surround Mississippi Power Co.’s Kemper County coal plant.

In June, the Mississippi Supreme Court consolidated two different sets of litigation surrounding the project.  Justices also ordered that attorneys for a Hattiesburg resident who is challenging the Baseload Act — the 2008 law that allows utilities to charge ratepayers for facilities as they are being built — and Mississippi Power submit briefs related to the issue within 30 days.

That would have set July 21 as the briefing deadline. The court heard oral arguments on the Baseload issue earlier this year.

The new briefing schedule allows attorneys a total of 70 days to file briefs related to the issues in question. The clock started July 10, when the order was entered.

Earlier this week, Mississippi Power asked the Mississippi Public Service Commission to start reviewing the coal plant’s costs. The prudency reviews could take several months; it could be the first part of 2014 before hearings are held.

The cost of the plant has gone up to just a little more than $4 billion, though commissioners have routinely said they will not allow the utility to pass any costs above $2.4 billion to ratepayers.

Bentz: Sierra Club claim about Kemper overrun incorrect (Updated)

June 20th, 2013 1 comment

The Sierra Club has filed papers with the Mississippi Supreme Court asking justices to direct the Mississippi Public Service Commission to supply records pertaining to a $366 million cost overrun at Mississippi Power Co.’s Kemper County coal plant.

The overrun was revealed in May 2012, shortly after the PSC reissued the plant’s certificate of public convenience and necessity. Regulators reissued the certificate after the state high court invalidated the first one that was issued in 2010, saying in a ruling that it did not properly cite the record of proceedings.

Southern District Commissioner Leonard Bentz and his staff have been investigating when the utility knew about the overrun. Bentz said in May that gathering information the past year has been difficult because former Mississippi Power president Ed Day had ordered it withheld. Day resigned last month and was replaced by Ed Holland.

In a Wednesday press release, the Sierra Club said Bentz and Central District Commissioner Lynn Posey – who along with Bentz has voted in favor of the project – should have known about the $366 million overrun when they voted to reissue the plant’s certificate.

The environmental advocacy organization, which has long opposed the plant, says a timeline prepared by Mississippi Power shows that both the utility and commissioners knew about the overrun in March 2012.

Bentz disputed that in an interview Thursday morning. He said regulators had been alerted by their independent monitors that there were “cost constraints” related to the plant.

“But we never knew a number” until Mississippi Power revealed the $366 million overrun, he said. “Our issue is about the power company not giving us the information we requested.”

Bentz said the investigation into when the utility knew about the overrun should be finished by early August.

“And if need be, we’ll have hearings,” Bentz said. “That’s a fact. We’re even looking at some options on the prudency hearings to make sure that (MPC) will not be given the green light before we get to the bottom of this. That’s in the best interest of the ratepayer.”

The coal plant is scheduled to start commercial operation in May 2014. Bentz reiterated that the utility, per the terms of a settlement with the PSC, will be allowed to charge ratepayers no more than $2.4 billion in construction costs. “That’s always been the number,” he said.

UPDATE: Thursday afternoon, the Mississippi Supreme Court consolidated two different sets of litigation surrounding the project. Justices also ordered that attorneys for a Hattiesburg resident who is challenging the Baseload Act — the 2008 law that allows utilities to charge ratepayers for facilities as they are being built — and Mississippi Power submit briefs related to the issue within 30 days. That would set July 21 as the briefing deadline. The court heard oral arguments on the Baseload issue earlier this year.

Miss. Power names new VP of generation and development

June 6th, 2013 No comments

Mississippi Power Co. announced Wednesday afternoon that John Huggins has been elected vice president of generation development.

Huggins replaces Tommy Anderson, who abruptly left in April.

Like Anderson, Huggins will oversee the development and construction of the utility’s Kemper County coal plant. Huggins has served since 2010 as general manager of the Kemper County facility’s start-up, engineering and construction services.

“John is not only a proven leader in engineering and construction, but also in implementing and sustaining successful energy facility operations,” Mississippi Power president Ed Holland said in a company press release. “He has the knowledge and experience needed for this role, but most importantly he knows this facility. I have every confidence in his ability to ensure the successful completion of the Kemper project.”

Huggins joined Southern Company in 1972 as an engineer. During his career he has held a number of leadership roles at Mississippi Power, Alabama Power and Southern Company. He served as general manager of clean air compliance, construction services and environmental program strategic planning. Huggins earned a bachelor of mechanical engineering degree from the University of Alabama, and is a registered, licensed professional engineer.

The Mississippi Public Service Commission is still trying to determine if the utility knew about a $366 million cost overrun that was revealed a couple weeks after regulators re-affirmed the project’s certificate of public convenience and necessity. Southern District commissioner Leonard Bentz told the Mississippi Business Journal in late May that the PSC had pursued information related to the overrun for the better part of a year, before learning that it had been withheld under former president Ed Day’s direction. Day resigned last month. Bentz said his office would continue to investigate the matter.

The plant, whose total cost has risen above $4 billion, is scheduled to start commercial operation in May 2014.

Regulator: Day’s departure due to his withholding Kemper information

May 20th, 2013 5 comments

Mississippi Power Co. has made an abrupt change at the top.

Southern Co.’s board of directors voted Monday to name G. Edison “Ed” Holland the utility’s new leader. Holland replaces Ed Day, who has been president since 2010. Day has spent a total of 30 years with Southern Co.

The change will be effective immediately. Holland will be “responsible for the operations of Mississippi Power, including overseeing the continued construction of the Kemper County energy facility,” said a company press release.

Southern Co. gave no reason for Day’s departure, but it comes about a week after the Mississippi Public Service Commission learned that Day had ordered that documents containing details of when the utility knew about cost overruns at the Kemper County coal plant be withheld from regulators.

The PSC in April 2012 affirmed the project’s certificate of public convenience and necessity, after the Mississippi Supreme Court ruled that the original certificate – issued in 2010 – did not cite sufficient evidence from the record of proceedings.

In May 2012, Mississippi Power revealed that the Kemper facility would cost roughly $300 million more than it had originally estimated.

Southern District Commissioner Leonard Bentz, who counts as his constituents most of Mississippi Power’s 190,000 ratepayers, said in an interview Monday morning that regulators asked about a year ago for information that outlined when the company knew about the overrun, in response to it being revealed right after the PSC reaffirmed the project’s certificate.

Day, Bentz said, ordered that the information be withheld.

“My investigation revealed about a week ago that there was information not being given to us under the direction of Ed Day,” Bentz said. Bentz said regulators received the requested overrun information last week. He added that his office will continue to investigate the matter.

“We’re not done,” he said. “This is an absolutely ridiculous way of doing business. Corporations sometimes hide behind trying to protect the shareholders. If this is what that is, they live in a different society than what’s right. We were not fed and given the proper information. What does that do to the credibility of Mississippi Power moving forward?

“This is a culture that has kind of somewhat become acceptable in the corporate world, to put a spin on everything,” Bentz continued. “Talk straight and give me the truth. A spin is a lie to me. We are not done. We are going to protect the ratepayers. Ed Day’s departure is a direct result of us as regulators doing our jobs and protecting the ratepayers.”

Bentz said Southern Co. CEO Thomas Fanning “has done everything he said he would do” since becoming involved in the matter. “He deserves a lot of credit.”

The Kemper County coal plant is scheduled to begin production in May 2014. Mississippi Power last month revised the project’s cost estimate upward, bumping it to just over $3 billion. Per the terms of a settlement with the Mississippi Public Service Commission, the utility can charge ratepayers only for the first $2.4 billion in construction costs. Lawmakers approved in the session that ended in April up to $1 billion in bonding authority that would cover cost overruns. The bond falls outside PSC jurisdiction.

“They told us they could build this plant for $2.4 billion, and that’s what we expect them to do,” Bentz said.

Miss. Power increases cost estimate for Kemper plant

April 23rd, 2013 2 comments

Mississippi Power Co.’s Kemper County coal plant will cost $3.42 billion to build, the utility announced Tuesday afternoon.

That’s just under $600 million more than the $2.88 billion figure that has been the maximum estimate for several months. In a press release, CEO Ed Day said the utility will not seek to recover the additional costs from ratepayers.

Doing so would have been difficult. A recent settlement that allowed Mississippi Power to ask for cost recovery stipulated that the plant’s rate base – or what costs the utility could recover from its 190,000 ratepayers – be limited to $2.4 billion. The settlement was reached after Mississippi Public Service commissioners denied last summer a cost recovery request pending the outcome of litigation that has circled the facility since before construction started.

“While we are disappointed that costs have increased, we believe we have done the right thing by remaining accountable to our customers,” Day said in the company press release.

The Sierra Club, which opposes the plant, still has litigation active against it. A Hattiesburg resident has also challenged the Baseload Act, the 2008 law that allows utilities to recover constructions costs associated with new facilities as they are being built. The Mississippi Supreme Court heard oral argument related to the Baseload challenge earlier this year, but has not yet ruled.

The palnt is scheduled to begin commercial operation in May 2014.

PSC approves multi-year rate plan for Kemper coal plant

March 5th, 2013 No comments

Mississippi Public Service commissioners voted 2-1 Tuesday to approve a multi-year rate plan for Mississippi Power Co.’s Kemper County coal plant.

Terms of the plan call for the utility to receive $99 million in construction-work-in-progress funds for the rest of 2013. That will create a rate increase between 12 and 13 percent for residential customers who use 1,000 kilowatt-hours per month, starting in April. The average residential customer uses about 1,100 kw/h per month, according to PSC figures. Power bills will rise by a little less than $20 per month, according to utility estimates.

In 2014, rates will increase by another 3 percent, bringing the total rate increase associated with CWiP to 15 percent. When Mississippi Power issues bonds to cover costs exceeding $2.4 billion – company CFO Moses Feagin said Monday that would likely happen in late 2014 – rates will jump again. The cumulative rate impact over the life of the seven-year plan and the bond issuance is expected to peak at 22 percent. Those calculations do not include fuel adjustment costs, which could raise or lower rates, depending on the price of fuel.

Mississippi Power, during a hearing that lasted most of Monday afternoon, had asked for more revenue, but Southern District Commissioner Leonard Bentz said the $99 million figure was appropriate because “we’re in the middle of people’s budget years. I felt that would be the best amount.”

The multi-year rate plan and the bond issuance were part of a settlement between the PSC and the utility that ended litigation brought when regulators denied last summer a 13 percent rate increase for the project. Gov. Phil Bryant signed last week two pieces of legislation that codified the settlement.

The vote on the rate plan came after a public comment hearing that lasted the bulk of Monday morning.  Of the two dozen or so people who spoke, seven were in favor of the project.

One was David Carr, the mayor of Newton, which sits just southwest of the Kemper County site.

“Mississippi Power is our No. 1 economic booster,” Carr said. “They would not have started this plant if they did not think it was in the best interests of customers.”

Most of the objectors had pointed remarks for Bentz and Central District Commissioner Lynn Posey, who has routinely voted for the project. Northern District Commissioner Brandon Presley has been the lone dissenting vote.

Commenters used a variety of terms to describe Bentz and Posey’s support of the project, suggesting they were subservient to “corporate puppet-masters” and calling the rate increases “corporate fascism.”

After the public comment portion of the hearing, Bentz retaliated.

“It’s very easy to sit back and make accusations that are untrue,” he said to the audience in the PSC’s hearing room. Bentz said a lot of the problems arose from “misinformation” being spread by the media and special interest groups on both sides of the issue.

One of the groups Bentz singled out was the Sierra Club, which has opposed the plant from its inception, calling it expensive and unnecessary.

Louie Miller, executive director of the environmental group’s Mississippi chapter, called the PSC’s approval of the rate plan “shameful” and said it would place an additional burden on Mississippi Power ratepayers who are already struggling financially.

Mississippi Power spokesperson Cindy Duvall called Tuesday’s vote “a huge step forward.”

“The sooner we can get cost recovery for our facility, the less overall cost impact for our customers,” she said. We’re going to go and review the order in its entirety and we’ll determine next steps from there.”

 

Miss. Supreme Court asks for more briefs related to Baseload Act

February 14th, 2013 No comments

The Mississippi Supreme Court asked Thursday afternoon for additional briefs related to a Hattiesburg resident’s constitutional challenge to the Baseload Act.

The ruling comes after a Jan. 28 hearing in which Thomas Blanton’s attorney told seven of the court’s justices that the Act – which was passed in 2008 and allows utilities to charge customers for generation facilities as they are being built – is unconstitutional because it violates the Constitution’s 14th Amendment, which prevents confiscatory taking of property without due process.

Mississippi Power attorneys argued in the same hearing that the law allows for utilities to increase rates for used and useful services, and the facilities the Act is designed to pay for are the benefit customers receive.

The hearing was the result of a rate dispute between the PSC and Mississippi Power related to the Kemper coal plant. The two entities settled that less than a week before the hearing. In Thursday’s order, the high court accepted the settlement and dismissed that case.

The court said the briefs it ordered will have to address five issues:

  1. Whether Blanton’s challenge to the Baseload Act is moot.
  2. Whether his challenge is ripe for the court to consider
  3. Whether the Baseload Act provides for an unconstitutional tax, as Blanton’s lawyer alleged Jan. 28.
  4. Whether the Baseload Act is otherwise unconstitutional
  5. Whether Blanton was accorded due process

Attorneys for Blanton, Mississippi Power Co. and the Mississippi Public Service Commission have 20 days from Feb. 12 to submit their briefs.