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Miss. commission denies challenges of power plant

The Mississippi Public Service Commission has denied two motions, including one filed by state Attorney General Jim Hood, challenging the application for a planned $2.2 billion power plant in Kemper County.

Hood had said he was concerned Mississippi Power Co. was blending the certificate or application for the plant with a rate increase request. He also said in his motion that the PSC has jurisdiction over electric utilities, but not over the manufacturing of synthetic gas.

The plant would be an integrated gasification combined cycle (IGCC) facility that converts locally mined lignite, or “brown coal,” into a gas to generate lower-emission electricity.

Mississippi Power is the first to potentially use a 2008 state law that lets companies seek a rate increase in advance to help pay for an electrical-generating facility. Under the old law, a utility had to wait until a plant was operating before asking for rate increases to recover construction costs.

In an order filed Friday, the three-member commission said it would separate the issues during the hearing process — first addressing the need for the power plant, which is the main part of the application, and then the possible rate increase.

“The commission denies the attorney general’s motion … because it finds the issues raised in his brief are addressed in this procedural order,” the PSC said.

The PSC disagreed with Hood’s challenge to its jurisdiction and ruled that it could determine the fate of the application because the gas process is part of the power plant.

“Without it, there would be no IGCC plant,” the PSC said.

Entegra Power Group and Magnolia Energy, two independent power producers, and the Sierra Club filed the other motion, challenging the need for the lignite clean-coal power plant.

The PSC denied that motion, saying it had “determined that this filing is a legitimate petition, and further, the company has a statutory obligation to serve its customers.”

Mississippi Power said it was pleased with the PSC’s order. The attorney representing Entegra Power Group and Magnolia Energy could not immediately be reached for comment.

“With the scheduling order in hand, Mississippi Power will prepare for those dates and looks forward to the opportunity to detail the project formally before the Public Service Commission,” company spokeswoman Cindy Duvall said Tuesday in an e-mail.

Mississippi Power is part of the Southern Company, which includes Alabama Power, Georgia Power and Gulf Power. It has about 184,000 customers in the 23 counties of southeast Mississippi and announced in December 2006 that it was considering building the plant in east central Mississippi’s Kemper County.

Besides the 260 permanent jobs, the utility says 1,000 jobs will be available during peak construction. The company has received a $270 million grant from the U.S. Department of Energy and $133 million in investment tax credits under the National Energy Policy Act of 2005.