Regulators settle with Miss. Power on Kemper plant

Published on NewsOK Modified: January 24, 2013 at 6:39 pm •  Published: January 24, 2013
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Commissioners in June rejected the company's request for a rate increase to cover such "construction work in progress," denting Mississippi Power's credit rating. They said at the time they wouldn't consider rate increases until a challenge of the plant's license by the Sierra Club was resolved. The environmental group is currently appealing a ruling of a Harrison County chancery judge upholding the license.

The Supreme Court had asked the parties to be prepared to discuss why the PSC shouldn't have frozen the rate request during legal proceedings.

"This is clearly designed to be an end-run around the Supreme Court," said Louie Miller, the Sierra Club's state director.

He said Bentz and Posey had flip-flopped by agreeing to consider up to $172 million in construction charges.

"They've moved back to 'Hey, we're going to give you $172 million in 90 days,'" Miller said.

Bentz, the southern district commissioner, has insisted that the plant would cost ratepayers no more than $2.4 billion, and he said the settlement was vindication.

"This is a victory for the ratepayers of Mississippi," he said.

Bentz predicted that rates would rise in the lower band of a 20 percent to 28 percent range to pay for the plant, or maybe even less. The company has said rates would rise about 33 percent, while opponents have warned it might be significantly higher.

But Presley, the northern district commissioner, said the deal doesn't rule out customers paying for amounts above $2.4 billion.

Mississippi Power is supposed to seek "alternate financing" for amounts above $2.4 billion. Presley said a bill could be introduced in the Legislature to allow the company to sell bonds to cover higher amounts. No such bill had been publicly posted as of Wednesday afternoon. Presley said customers could be charged for the bond payments, including interest, but Mississippi Power wouldn't make an additional profit on its money.

"That's the mother of all exemptions on containing costs," Miller said.

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