PSC opening access to more Kemper power plant documents

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Mississippi Power

Kemper Power Plant

Documents regarding the $6.6 billion Kemper County Energy Facility will soon be easier for the public to access.

The Mississippi Public Service Commission on Thursday directed its staff to post on the commission’s website executive summary updates detailing the power plant’s construction progress. The plant is scheduled to open around August, said Jeff Shepard, spokesman for Mississippi Power Co.

The documents are available to the public, but have been subject to a public records request, he said. The commission also is determining if it can unseal records related to the plant that have been kept confidential.

The vote took place during a public work session where monitors and engineers reviewed the construction status of the Kemper County Energy Facility with the commission.

PSC Commissioner Cecil Brown

Public Service Commission

Public Service Commissioner Cecil Brown

“There’s so many people affected by it,” said Cecil Brown, Central District commissioner for the Mississippi Public Service Commission. “It’s good to hear our monitors confirm what we have heard before the people.”

The Kemper County facility has run on natural gas since August 2014. An extension of the plant scheduled for completion in the third quarter of this year is designed to convert lignite, a type of coal, into a gas that will help create electricity in a process that has not been used previously.

Before certification, the plant was scheduled to start generating power from coal in 2013. Once certified by the Public Service Commission, Shepard said the plant was then scheduled to start generating power in 2014.

While the natural gas portion of the plant began operating that year, there was harsh weather and delays in productivity that kept the extension from being completed, Shepard said.

“The main driver in a lot of it is that this is a first-of-its-kind technology that’s being implemented,” Shepard said. “We are working and discovering issues and problems that arise, then having to correct them as we go along, and that extends the schedule. That’s something we’re focused on from a safety standpoint, is not sacrificing safety just to make the schedule.”

Mississippi Power announced in February some issues at the plant that were causing delays. Those issues, which were also discussed in detail with the commission Thursday, included difficulties operating several rotary valves/airlocks for unloading coal and gasifier refractory issues at high temperatures.

Rate increases related to the plant have impacted the power company’s roughly 186,000 customers in 23 counties from the Gulf Coast to Meridian. Shepard said the first rate increase related to the Kemper facility went into effect in April 2013. Those increased customers’ base rates by 15 percent, he said.

In January 2014, an additional 3 percent increase was added, bringing the total rate increases related to Kemper to 18 percent.

Last summer, the commission ordered Mississippi Power to rescind the rate increases for one month.

The rate increases zeroed out for one month, returned to 18 percent through the rest of 2015. A Mississippi Supreme Court ruling returned the rate increase to 15 percent on a permanent basis, beginning in January.

The total cost of the project is about $6.6 billion, more than double the original estimate for the plant at about $3 billion, Shepard said.

The company says it won’t collect above a $2.88 billion cap, part of an agreement reached with the commission to limit rate increases on the utility’s customers.

Shepard said the main reason why Mississippi Power realized it needed a new power plant: It has been 38 years since one of these facilities was built, and using lignite would diversify its fuel portfolio.

“This was built to protect customers from (becoming) over reliant on a very volatile fuel source (natural gas),” Shepard said.

Yet, the delays and added costs to get the plant running have sparked lawsuits against Mississippi Power.

Most recently, according to the Sun Herald newspaper, Island View Casino Resort, Biloxi Freezing & Processing Inc. and John Carlton Dean of Gulfport filed a lawsuit against Mississippi Power on March 2 seeking to have the company refund all charges for the plant, claiming it was a fraud to the two companies and Dean.

The three claim in their suit, filed with Harrison County Circuit Court, that the energy company deceived and defrauded the public in constructing the Kemper power plant, passing its costs off as rate hikes approved by the commission.

The plaintiffs also seek economic and punitive damages, plus attorney’s fees and other court costs, the Sun Herald said.