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Mississippi Power Rate Increase for Kemper County Coal Plant Denied
Case Updates:
January 28, 2013
January 28 marked the third trip to the Mississippi State Supreme Court regarding our Kemper Coal Plant fight!
Mississippi Power’s appeal of the Public Service Commission’s denial of cost recovery was argued at the state Supreme Court last week. The case centered on whether Mississippi Power should to be able to charge its customers for the $3-billion Kemper County clean coal plant before it starts making electricity in 2014. Several groups showed up to the court united by one thing; opposition to the dirty, expensive, and unnecessary Kemper Coal Plant. Groups ranged from the Mississippi Tea Party, small business owners, retired County Supervisor, Harrison County AARP, Gulfport NAACP, Kemper County Landowners, and many more.
A few days after the hearing, Mississippi Power filed a request to increase customer rates by 21%, following a settlement agreement the company signed with the Public Service Commission.
While ongoing litigation is being pursued by the Sierra Club’s Environmental Law Program, the state legislature is separately considering enacting new legislation that would allow Mississippi Power to recover an additional $1 billion dollars above and beyond the $2.88 billion dollar cost cap set by the Public Service Commission.
June 22, 2012
On June 22, the Mississippi Public Service Commission voted to deny a controversial rate hike of 15.7% for residential customers over the course of six months to pay for construction of Mississippi Power’s Kemper County Coal Plant.
Nearly a dozen individuals, representing organizations including the AARP of Harrison County, Mississippians for Affordable Energy, the North Gulfport Community Land Trust, and Sierra Club spoke in opposition to the proposed rate increase. Multiple speakers raised concerns about current cost overruns at the plant. With less than one-third of construction complete, Mississippi Power had drained its $167 M contingency fund and has overspent in engineering and construction costs, as well as other areas.
Sierra Club has challenged the dirty, expensive, and unnecessary Kemper County Coal Plant project from its inception, successfully arguing before the Mississippi Supreme Court that the PSC had improperly and illegally issued permits to Mississippi Power for construction and development of the project. After the Supreme Court decision, the PSC rubber stamped approval for the plant in a 45-second hearing with no public comment, which Sierra Club appealed to state court. . The PSC denied the rate increase pending the outcome of the Club’s challenge to Kemper’s permit.
April 26, 2012
On April 26, 2012, the Sierra Club appealed the most recent flip-flop by two members of the Mississippi Public Service Commission (PSC) on the Kemper County power plant and asked for a stay of the order granting Kemper a certificate of need. In a four minute meeting on April 24, Commissioners Leonard Bentz and Lynn Posey again refused to allow the public or opponents of the plant to speak, and without explanation reversed key findings of their original April and May 2010 orders approving the $2.8 billion dollar power plant.
In the April 24 order, key portions of which were drafted by Mississippi Power for the Commission, Bentz and Posey reversed their previous findings and stated that the plant is in the public interest, even if it costs the ratepayers more than Mississippi Power’s estimates.
Sierra Club continues to call on the Mississippi Public Service Commission to re-open the Kemper County coal plant case, accept new evidence and public comment, and accurately determine whether the plant is a good deal for ratepayers.
March 31, 2012
On March 30, in a closed meeting lasting less than one minute, the Mississippi Public Service Commission voted to issue an emergency authorization to Mississippi Power to continue spending $3 million per day building the Kemper coal plant. Since the March 15 state Supreme Court ruling that revoked the plant’s permit, Mississippi Power has scrambled to try and protect their investments in the project and burden coastal ratepayers with the expenses. The Commission’s actions were met with shock, disbelief, and anger from meeting attendees; opponents of the project travelled hours to attend the hearing, but were not given a chance to voice their concerns. In response, Sierra Club filed a motion with the state Supreme Court, asking the Court to prevent the Commission from taking this illegal action.
March 15, 2012
On March 15, the Mississippi Supreme Court issued a unanimous ruling that dealt a major blow to the dirty, expensive, and unnecessary proposed Kemper coal plant. Siding with Sierra Club, the Supreme Court ruled that the Public Service Commission had not provided evidence to support its May 2010 decision to allow Mississippi Power to raise project costs that would be passed off to local customers. In April 2010, the Commission determined that the proposed plant was a risky investment and capped the cost of the project at $2.4 billion. Less than a month later, the Commission overturned its decision, allowing Mississippi Power to raise project costs yet again without an explanation. The Supreme Court remanded the issue to the Commission for further proceedings.
March 4, 2011
On February 28, Harrison County Chancery Judge Jim Persons upheld the Mississippi Public Service Commission’s decision that will allow MS Power to move forward with its proposed coal-fired power plant in Kemper County. Despite admitting that the Commission’s order "lacked specific findings on the balancing of risks" and expressing concern about the project’s potential economic impacts on ratepayers, Judge Persons affirmed the final Certificate of Public Convenience and Need for the plant. Sierra Club has plans to appeal the decision to the Mississippi Supreme Court.
February 15, 2011
Photo courtesy Gulf Restoration Network.
On February 14, Sierra Club got its day in court to fight the Mississippi Public Service Commission’s (PSC) approval of MS Power’s proposed coal-fired power plant in Kemper County. The PSC conditionally approved the Certificate of Public Convenience and Need for the project in April 2010. Citing concerns with financial risks associated with the project, the PSC implemented a cost cap that would have made it difficult for MS Power to move forward with construction. Shortly after, bowing to pressure from MS Power, the PUC raised the cost cap, putting the power plant’s total potential cost to ratepayers at over $2 billion. Sierra Club appealed the PSC’s decision to the state Supreme Court in June of 2010, and the case was sent back to the Harrison County Chancery Court for further proceedings.
Over 50 people packed the small Chancery courtroom on February 14 to hear the case, many of them wearing stickers that read “dirty, expensive, and unnecessary” to show their opposition to the project. At the hearing, Sierra Club reiterated that, in addition to having harmful environmental and public health impacts, the project presents a huge financial risk to ratepayers. The Club argued that natural gas is a more viable fuel option, and customers should not be required to foot the massive bill to burn coal, an antiquated and dirty energy source.
Photo courtesy Gulf Restoration Network.
Details and Documents:
PSC Denies Mississippi Power Rate Increase for Kemper County Coal Plant
June 22, 2012, Sierra Club Press Release
Sierra Club Takes Latest PSC Flip-Flop to Court
April 26, 2012, Sierra Club Press Release
Miss. Public Service Commission Violates Law to Favor Mississippi Power, Disregard Public
March 30, 2012, Sierra Club Press Release
Sierra Club Files Motion to Mississippi Supreme Court After Public Service Commission Illegally Authorizes Kemper Plant Construction
March 30, 2012, Sierra Club Press Release
Proposed Kemper Coal Plant Permit Remanded
March 15, 2012, Sierra Club Press Release
Mississippi Supreme Court Decision
March 15, 2012
News Articles:
Customer challenges Miss. Power Kemper Rates
January 28, 2013 by Jeff Amy, Associated Press
Mississippi Power's Addition
July 18, 2012 by R.L. Nave, Jackson Free Press
Southern Co appeals Mississippi's coal-plant rate hike denial
July 9, 2012, Reuters
No rate hike, PSC says
June 22, 2012, Clarion Ledger
Mississippi rejects Southern Co coal plant rate request
June 22, 2012 by Eileen O'Grady, Reuters
PSC looking into timing, amount of Kemper County Coal Plant overrun
June 15, 2012 by Clay Chandler, Mississippi Business Journal
PSC lets Miss. Power coal plant to proceed for now
March 30, 2012 by Jeff Amy, Associated Press
Kemper Co. power plant case goes to court
February 14, 2011 by Doug Walker, WLOX
Kemper power plant challenge going to court
February 14, 2011 by Michael Newsom, Sun Herald
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