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Supreme Court decision possible setback for Kemper County coal plant

JACKSON- In a 9-0 decision March 15, the Mississippi Supreme Court ruled the Mississippi Public Service Commission’s decision to issue a certificate of public convenience and necessity to Mississippi Power Company to build a coal-fired generation plant in Kemper County was not based on “substantial evidence presented,” as required by law.

The decision was in response to a challenge to the $2.88 billion project by the Mississippi Chapter of the Sierra Club, which advocates for environmental issues. The Sierra Club argued the plant was unnecessary, dirty and expensive. A Harrison County chancellor ruled in favor of MPC, and the Sierra Club appealed to the state’s high court.

Mississippi Public Service Commissioner Brandon Presley hands documents to fellow commissioner Leonard Bentz at a 2010 PSC meeting in April 2010 to decide the future of a multi-billion clean coal power plant to be built by Mississippi Power Company.

What the court’s decision means is that the evidence the PSC considered in issuing the certificate will have to be revisited. Exactly how that occurs is still up in the air.

After denying a certificate for the project in April 2010, the PSC reversed course two months later, voting 2-1 to issue one, and to allow MPC to pay for the project with an average 45 percent increase in ratepayers’ power bills. Northern District Commissioner Brandon Presley was the only dissenting vote. He expressed concern that the technology MPC planned to use at the facility — which would rely on lignite coal that’s indigenous to East Mississippi — was unproven and could not be relied on to produce electricity on a commercial scale. Presley also said the company should finance the project’s cost, not its ratepayers. Southern District Commissioner Leonard Bentz and Central District Commissioner Lynn Posey, who voted in favor of the project, did not respond to messages last week.

When the certificate will be rendered invalid will come within 21 days of the supreme court’s March 15 decision. The high court will issue a mandate to Harrison County Chancery Court, which will most likely kick the proceedings back to the PSC. At that point, the proceedings will be at the point they reached in April 2010, after the last evidentiary hearing. Commissioners can re-issue the certificate of necessity, deny it, or choose to hold more evidentiary hearings.

Presley wouldn’t speculate on what would happen then.

“We need fresh eyes on this,” he said. “There needs to be a new examination of the facts.”

The Sierra Club has already asked the PSC to do just that. In a motion seeking a status conference, filed last Tuesday, the Sierra Club provides updated long-term forecasts from a regulated utilities expert for natural gas prices compared with price data MPC initially used. Both sets of data are blacked out due to confidentiality.

“This is anything but a technicality,” said Louie Miller, director of the state’s Sierra Club chapter. “This, in our opinion, puts us back to square one. This thing deserves to be looked at objectively and not politically.”

The Sierra Club’s motion also seeks an “orderly halt” to construction at the plant.

For now, construction will continue, a MPC spokesperson said in a statement issued one day after the court’s decision.

“We are confident there is substantial evidence in the record to support the Commission’s approval of the certificate,” said Jeff Shepard. “It is our hope and expectation that the Commission will address this expeditiously.” Shepard did not respond to messages seeking further comment last week.

“Right now they technically have a legal certificate,” Presley said last week, referring to MPC’s decision to continue construction, which started last year. Presley added that MPC has told PSC field monitors that it expects a cost overrun on the project between $60 million and $100 million. “There’s an old saying that when you find yourself in a hole, you quit digging,” Presley said.

If the PSC grants the Sierra Club’s motion and stops construction, any money MPC spent on the project between March 15 and whenever the PSC rules cannot be recouped from ratepayers.

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