Wednesday, October 29, 2014

AP: Another half a billion smackers for Kemper

The Associated Press reported Kemper costs are going up again:

Southern Co. says it will cost at least another $496 million to finish the power plant it's building in eastern Mississippi's Kemper County, pushing the total cost above $6.1 billion.

And, unlike other recent overruns, customers could have to pay $167 million of the charges if regulators agree.

The Atlanta-based parent of Mississippi Power Co. pushed back the completion date for Kemper from June 2015 to at least March 2016, and said further delays beyond that would cost $20 million to $30 million a month.

Southern said the additional money will pay for material and labor during the plant's startup phase, as well as additional interest the company will earn on money it's already invested because of the delay. The plant and associated lignite mine were originally supposed to cost $2.8 billion and begin operating last year.

"We absolutely continue to feel that this is in the best interest of our customers and the state of Mississippi," Mississippi Power President Ed Holland said in a phone interview.

While it was once construction delays and complications driving up the cost of the project, Holland said this time the company is slowing down and spending more money on starting what the company calls Plant Ratcliffe.

"We wanted to look realistically, from both a training perspective and a startup perspective at how long it would take," Holland told The Associated Press in a phone interview..... Rest of article


Anonymous said...


Anonymous said...

Republicans better run, hide and wear disguises because the ratepayers are going to track them down and lynch them for SB2793. The GOP is killing Mississippi.

Anonymous said...

What MPC/SO need to be afraid of is what happens if the damn thing is actually ever started up with the gassifier instead of on natural gas: whether it can be operated safely without blowing its top at 1800 degrees; whether it can operate at all consistently within tight temperature and ash tolerances or will require long down periods; and whether it can operate with acceptable maintenance costs. It's a potentially a lot worse than just the cap-X issue visible now.

Anonymous said...

"We absolutely continue to feel that this is in the best interest of our customers and the state of Mississippi," Mississippi Power President Ed Holland said in a phone interview". This man is either a liar or a fool. Not only does this hurt the ratepayers, who are already paying 18% more for electricity, but also will be devastating for business and industrial recruitment.The total costs are unknown but be assured this is not a good deal for anyone accept the people involved in the cost plus construction of the money pit called Kemper.

Anonymous said...

Haley Barbour's hits just keep on coming. Nearly everything he touched has turned into absolute shit. The money this Kemper disaster will take out of ratepayer pockets is going to hammer the state economy for decades.

Anonymous said...

When can we tar and feather the Public Service Commission? I have grown to really hate those bastards.

Anonymous said...

4:30 I vote liar.

Anonymous said...

Proof that idiocy knows no party affiliation.

Anonymous said...

A billion dollars just won't buy what it used to. The state just needs to print more money. Problem fixed.

Spending OPM is so easy, especially public funds.

Anybody have the address handy where I need to send an invoice for my consulting services?

Anonymous said...

most likely it will never make a megawatt unless a NG pipeline is built to feed it. I am more certain a host of people will testify that it was a prudent decision.

Anonymous said...

5:44 The plant is fed by large natural gas pipelines and is operating on NG right now, producing electricity. The question is if the plant will ever be used to turn lignite into synthesis gas in place of abundant, cheap natural gas, which is where all the capital costs over the first $800 million or so are. But larger capital costs translate into higher rate of return revenues. Get it?

Anonymous said...

5:44 - Isn't it already currently running on NG?

I wonder who is going to get boned worse at the end - the Southern Co or the Jackson water & sewer ratepayers.

Anonymous said...

If the lignite doesn't work there is an outfit out there ready to sell its receipe for tree oil on the cheap.

Anonymous said...

"I wonder who is going to get boned worse at the end - the Southern Co or the Jackson water & sewer ratepayers."

Here's how I analyze this one:

Which entity has the better lobbyists? Which entity offers the best future employment and consultation opportunities for retired or defeated/disgraced politicians?

Think I know who ought to stock up on the lube. It isn't Southern.

Anonymous said...

word on the street is that lynn posey, central district PSC, might not run for re-election because "he doesn't like the job".....ah, maybe he's just afraid of the voters come next year

Anonymous said...

I ain't no math wiz, and correct me if I'm wrong, but if 186,000 customers are responsible for an additional $167,000,000, doesn't that average out to a little less than $1,000 per "customer" for this? Then, for the $1,000,000,000 they convinced the legislature to approve "on a wave a shrimp & whiskey," another approximate $5,000 per "customer." Then, for the $2,880,000,000 that was approved by the Public Service Commission, another approximate $15,000 per "customer."

So, the average customer is "investing" more than $21,000 in this thing? When do I get to see some returns on that?

For me, although we talk "billions" and "millions," until you see the commas and zeros it doesn't really sink in as to how large this project really is. Hell, the entire Southern CO only has a market cap of 41,000,000,000.

Anonymous said...

Sugar sugar, awe honey honey. ( go watch the video on YouTube and maybe you'll get it in regards to politics as of now)
It will FLOP.
There are people that know how to do 'clean energy' efficiently and most of all cost effective. Said persons have to sit back and wait for all of this crap to flop in order to move and actually move forward. The real problem is that the current floppers promised you a carrot and you got a big fat lie thus not trusting furthered and integral clean energy businesses.The clean energy business isn't so clean when it comes to projects like this.

Anonymous said...

Lynn Posey has helped Miss. Power and Southern Company screw the customers. I live in south Mississippi and wonder how we'll ever attract another industrial prospect due to outrageous power costs. It bothers me that someone I can't vote for has raised my rates. Then again, the PSC is in charge of the No Call List and I'm getting more calls than ever. Really Lynn, please don't run again.

exjxnres said...

It is ALWAYS about the money. Follow the money to the root of the corruption.

Anonymous said...

@4:40pm Would you also "tar and feather" Brandon Presley who has said from the beginning this was a boondoggle?

Anonymous said...

The state is not on the hook for any of these dollars, despite all the commentators on here that try to push the agenda. The ratepayers are not on the hook for all the cost overruns, again despite all the commentators here (and elsewhere for that matter) that try to push that agenda.

Southern Company stockholders might want to question these overruns. Customers might want to question the original investment ($2.8 +/- billion) and the concept. But to try to label this as an expenditure of tax dollars you obviously don't understand capitalism - just want to label anything that doesn't benefit you personally as cronyism.

Anonymous said...

You are leaving out the $1 Billion bond that ratepayers will have to pay back in addition to the $2.88 Billion, making the cost to rate payers a total of about $4 Billion--all when a gas powered plant could have been built for $600 million or so.

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