Mississippi Power Co. made moves recently to resolve some of its Kemper County energy facility project woes about one week before the Public Service Commission will hear testimony and evidence for and against the $7.5 billion-plus Kemper plant as part of a settlement process.
However, the commission has the final say on any plan that solidifies Mississippi Power Co.’s recovery rates for its customers.
Mississippi Power, Chevron Products Co., The Chemours Co. and others conclude the unit of Atlanta-based Southern Co. should collect an estimated $117.78 million annually – or around $942 million total – in rates over a period of eight years starting Jan. 2018 – for its in-service assets and liabilities in what is known as a stipulation document filed with the commission last Wednesday. The company already expects to cover $6 billion in project costs.
Mississippi Power says this agreement amounts to less than they wanted to recover for the project.
In a recent filing, Mississippi Power lowered the plant average rate base value to $907 million compared to an August filing when Mississippi Power suggested the value of the plant was worth almost $1.1 billion.
It has since disputed this plant value with Mississippi Public Utilities Staff officials, who said a lower price should be recovered.
The costs being considered for recovery are over the plant’s in-service assets include the combined cycle portion of the plant fueled by natural gas; its transmission projects such as lines and substations; and wastewater and natural gas pipelines, a commission filing states.
Mississippi Power Co., the Mississippi Public Utilities Staff and others are currently in a hearing process the Public Service Commission scheduled from October through December. Commissioners expect to make a decision on the fate of the plant in January.
Earlier this month, Mississippi Power in two annual rate filings with the commission requested of 8.5 percent increase in residential rates amounting in an extra $11.45 per month.
The company said in a statement that the increase “is not designed to address major capital costs such as the addition of new generating plants, like the Kemper County energy facility or major environmental control equipment,” but instead stems from the cost of operating and maintaining company facilities such as the poles, wires, substations, generating plants and staff.
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Raw deal all around. MP asks customers for $942 million for a gas plant generating maybe 700MW of cheap juice? Entergy Mississippi recently bought its 620MW Hot Spring gas plant for only $253 million. And didn’t MP’s parent company, Southern Company, dish out $8 billion for AGL Resources back in 2015? They seem to have the resources to bail themselves out without sidling up to their customers.