PSC approves over $60 million in compliance projects for coal units in Jackson County

Print Share on LinkedIn More

The Public Service Commission gave Mississippi Power Co., a subsidiary of one the nation’s largest utility companies, Southern Power, the green light last Thursday by approving $62.5 million in compliance projects for two coal-fired units at Plant Victor Daniel.

The projects, which focus on closing a coal ash pond at the plant, are required for Plant Daniel to comply with federal environmental standards updated last year, the PSC ruled. In July, 2018, the Environmental Protection Agency extended the deadline for plants to close ash ponds to October, 2020.

It’s unclear yet whether Mississippi Power will pass the costs onto its ratepayers.

The PSC heard arguments from the Mississippi chapter of the Sierra Club in a public hearing. The Sierra Club argued that if Mississippi Power instead closed the coal-fired units altogether, only the ash pond closure would be necessary, trimming the costs by  $45 million.

A breakdown of the project’s costs:

  • A bottom ash handling facility, costing $23.85 million
  • Ash pond closure, costing $16.75 million
  • A low volume wastewater treatment facility, costing $21.95 million

Despite Mississippi Power’s uncertainty around who will pay the costs, the Sierra Club argued under the assumption that ratepayers would be the ones held responsible.

“There’s a disagreement between Mississippi Power and the Sierra Club about how uneconomic this plant is, but it’s just a difference of degree, it’s not a question of whether the plant is uneconomic,” argued Robert Wiygul, attorney for the Sierra Club.

Mississippi Power, which generates energy for Southeastern Mississippi, responded that closing the Jackson County plant would create reliability issues for its customers.

Plant Daniel, which generates over 1,000 MW of electricity at maximum capacity, only operates around 25 percent of the time, according to the Sierra Club.

Northern District Commissioner Brandon Presley contented that by not approving the projects, the PSC would in effect place Mississippi Power in violation of federal law.

Mississippi Today

Brandon Presley, chairman of the Mississippi Public Service Commission

“I don’t think that anybody would contest that if this (project is not approved), that if they miss that deadline in 2020, they will have violated federal law,” Presley said at the hearing.

He added that approving the projects does not stop the PSC from closing the coal units in the future. Both units are scheduled to retire by 2046.

The federal law at hand is the EPA’s Coal Ash Rule, which took effect in 2015 after coal ash spills in Tennessee and North Carolina that led to river contamination. EPA Administrator Andrew Wheeler, a former coal lobbyist, updated the law in 2016 to give utility companies more flexibility.

Florida utility Gulf Power, which owns a 50 percent share of the coal units at Plant Daniel, has already announced its intentions to retire its portion of the plant.

A March report from The Environmental Integrity Project examining coal ash pollution found that groundwater near Plant Daniel showed five times the safe amount of lithium.