Bryant signs 2 bills ratifying Kemper settlement

Published on NewsOK Modified: February 26, 2013 at 8:26 pm •  Published: February 26, 2013
Advertisement
;

The settlement says Mississippi Power can earn profit on $2.4 billion in plant costs as well as $377 million in lignite mine and pipeline costs. Customers would repay up to $1 billion in bonds issued by a company subsidiary to cover plant costs above $2.4 billion, but Mississippi Power would earn no profit.

The Sierra Club, which is the main opponent of the plant, has derided that ability to issue bonds as a "blank check" for more cost overruns. Kemper County's cost has risen from $2.4 billion to $2.88 billion, and could rise more by the time it goes into commercial operation, projected to be in April 2014.

The Sierra Club also objects to a provision of the bond law that says anyone except Mississippi Power who wants to appeal a PSC decision on debt has to post enough money before an appeal to cover the amount that the PSC finds bonding will save customers. Mississippi Power says the plan will save customers $1 billion.

The Sierra Club has said it's mulling a legal challenge to the laws.

The 7-year rate plan projects that the base power charge, separated from what the company will collect for the debt surcharge and fuel costs, will fall 2 percent in January 14. The company claimed in a statement Tuesday that will lower the overall rate impact on customers to an average of 20 percent.

The rate plan locks in charges without the chance to change them if Kemper's operating costs turn out to be higher or lower than projected. The company projects steadily falling operating costs, which could portend a rate cut after 2020. If it costs more to operate Kemper, the PSC could allow Mississippi Power to collect additional money after 2020. If it costs less, rate decreases could be greater.

___

Online:

House Bill 1134: http://bit.ly/Z0t10p

House Bill 894: http://bit.ly/YKQ5fU

___

Follow Jeff Amy at http://twitter.com/jeffamy