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PSC brings Kemper plant saga to an end


An eight-year struggle over a troubled “clean-coal” power plant came to an end Tuesday before the Mississippi Public Service Commission.

The commissioners voted unanimously during a meeting to bring the case to a close and then discussed at a press conference that the resolution of the Mississippi Power Co. case would actually mean a 2.4 percent reduction in bills for the average residential bill.

The coal-gasification plant never achieved successful commercial operation of turning lignite coal into “syngas.” The commission ordered that the company could never operate the gasification aspect of the plant and charge ratepayers for that.

The concept was to provide cheaper energy but the price of natural gas dropped to historic lows because of advances in production, primarily hydraulic fracturing, or fracking.

The commission ordered the utility to continue to operate solely on natural, which it has been doing since August 2014.

The project in Kemper County swelled to a cost of $7.5 billion from the initial estimate of $2.9 billion. Early in the case with its numerous hearings and 450,000 pages of testimony there had been some speculation was that the plant could lead to double-digit increases, commission Chairman Brandon Presley said in an earlier interview.

Mississippi Power and its parent, the Southern Co., will absorb $6.4 billion in losses. Southern Co. will write off $3.4 billion on its books and “recapitalize” its operating company based in Gulfport.

The utility serves 189,000 customers in southern and eastern parts of the state, making it the third-largest power provider in the state behind Entergy Mississippi and Mississippi Cooperative.

It said in a statement on its website that it “is pleased with this final order from the Public Service Commission, which effectively settles all costs associated with the Kemper County energy facility.”

“Throughout the settlement process, Mississippi Power has met each directive from the Commission and has worked with key parties to ensure our customers are shielded from any increase in rates related to Kemper.

“We look forward to the continued operation of this efficient natural gas facility, which has been serving our customers for more than three years.”

Presley, who was the lone voter against issuing a certificate for the plant in 2010, said that the natural-gas-fired plant is more than sufficient to provide electricity, currently producing more power than the certificate calls for – 661 megawatts, compared with 518 megawatts.

Central Mississippi Commissioner Cecil Brown and Southern District Commissioner Sam Britton were not on the panel when the plant was certified.

Thomas Blanton, Hattiesburg oilman and staunch opponent of the project from the beginning, had argued since the case entered the PSC-mandated resolution phase that the regulators had overstepped their authority.

However, Blanton said after the press conference that he has no plans “at this time” to appeal the case to the state Supreme Court.

Questions asked of Mississippi Power about what it intends to do with the coal-gas assets were not immediately returned on Tuesday.


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About Jack Weatherly