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Sierra Club Voices Concern About Cost Kemper County Plant

By Evelina Burnett | Published 10 Jul 2013 08:47am | comments

The Sierra Club is sponsoring ads calling on regulators to take action on the new Kemper County Coal plant.

An environmental group is once again calling on the Public Service Commission and Mississippi Power to put a stop to rate hikes related to the controversial new power plant currently under construction in Kemper county. 

The Sierra Club has placed a billboard ad on this busy road in Gulfport. It calls on Mississippi power to give more details about its new Kemper power plant. The utility said in a recent Public Service Commission report that it’s found another $160 million in likely cost increases. Louie Miller of the Sierra Club says the commission should reconsider Kemper-related rate increases until it’s clear how much the plant is going to cost.

"Suspend any rate increases until we know who knew what and when, where this is going and how much the ultimate price tag is going to be," said Miller. 

The Commission has said Mississippi Power could recover up to $2.4 billion of construction costs from customers. Southern district commissioner Leonard Bentz says he’s committed to keeping the utility at that number.

"They said they could build it for 2.4 billion dollars, and I expect them to build it for 2.4 billion dollars," says Bentz.

In March, the commission approved Kemper-related rate hikes of 15% this year and 3% percent next year. Mississippi Power says that, after the plant is online and prudency hearings are held, it expects to ask for an additional 4 percent rate increase. This would help pay back up to $1 billion in bonds it got legislative approval for this spring. That would bring the total Kemper-related rate increase to about 22 percent. But, they may get some push back on that additional request. 

"It's going to be very interesting to figure out how those bonds are going to be paid back because if it takes approval from my office, you can rest assured they will not be getting approval from me," emphasized Bentz. 

The Kemper county plant will create power by gasifying a local coal called lignite. Mississippi Power spokesman Jeff Shepard says the plant was found to be the best way to create the power customers will need in the future while diversifying its fuel sources.

"With Kemper, we'll have regular coal, natural gass and now lignite in our fuel mix and we feel like that's the best thing to do for price stability for our customers," said Shepard. 

Shepard says the company expects the Kemper plant to be operational in May 2014.






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