Kemper County Power Plant: Mississippi Power Wants To Settle: Official

JACKSON, MS — Mississippi Power Co. wants to settle on terms to wind down a coal-fueled power plant project in Kemper County, according to a state official overseeing the talks.

Public Utilities Staff Executive Director Virden Jones said Thursday he believes the unit of Atlanta-based Southern Co. wants to settle on terms set by Mississippi's Public Service Commission and the company has already made proposals. The staff and commission are separate agencies.

The three elected commissioners have said Kemper should run on natural gas — not gasified lignite coal. Rates should stay level or fall, they said, and customers shouldn't pay for the gasifier. Last week, Mississippi Power said it was suspending efforts to complete the gasifier, which is three years behind schedule. The plant is more than $4.5 billion over budget. (For more Meridian news, click here to sign up for real-time news alerts. If you have an iPhone, click here to get the free Patch iPhone app.)

Southern Company and Mississippi Power have announced the suspension of gasification operations at Kemper - https://t.co/zhRWcAjVtz
— Mississippi Power (@MS_Power) June 28, 2017

Southern could have to absorb another $3.4 billion in losses on the $7.5 billion plant, after already losing $3.1 billion, if the gasifier isn't used.

If Mississippi Power doesn't settle, commissioners say they will require the Gulfport-based company to show why the license for the entire Kemper facility shouldn't be revoked. That could mean the company wouldn't collect even the $800 million-plus already placed in rates for the part of the plant that has been burning natural gas since 2014.

"They want a settlement in this and I think that now that the gasifier is off the table, there's a lot better prospect that will happen," Jones said.

Cindy Duvall, a spokeswoman for Mississippi Power, said the company is examining the order and will respond later.

Commissioners formalized an order Thursday saying the gasifier should be abandoned because of high costs and other problems. It instructs Mississippi Power and staff to negotiate a settlement within 45 days. The commission says it will take public comments and then vote within another 45 days.

By Jeff Amy, Associated Press

Photo credit: Rogelio V. Solis, Associated Press