Mississippi Power Co. to suspend Kemper coal operations

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November 2015 AP file photo

Aerial view of the Kemper County plant

Mississippi Power Co. will immediately “suspend lignite coal gasification operations” at the Kemper County energy facility, according to information from a utility regulating agency.

Original plans for Kemper called for burning lignite coal, which is abundant in the region, to produce a synthetic gas. Mississippi Power has run into a number of snags with these machines, called gasifiers. The result has been years worth of delays and a price tag that has ballooned to $7.5 billion.

The Mississippi Public Service Commission, which oversees public utilities, last week advised Mississippi Power Co., a subsidiary of Atlanta-based Southern Co., to operate the beleaguered power plant on natural gas.

At the time, commissioners said any settlement presented to the commission should remove responsibility from ratepayers for the plant’s lignite coal technology and related assets; involve no rate increase to Mississippi Power’s customers; and revise the plant’s operating license to only allow for operation of a natural gas facility at the Kemper County project’s location.

Mississippi Power Co. has a $2.88 billion cost cap in place for customers regarding the power plant portion of the project. The company said in a June U.S. Securities and Exchange Commission filing that $4.3 billion in project costs is eligible for recovery. There was no cap in place for recovering infrastructure-related costs, such as the plant’s adjacent lignite coal mine, its proposed carbon-dioxide pipeline and transmission.

Public-service commission officials plan to issue an order at the agency’s July 6 meeting.