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Kemper Project clean coal power plant will miss yet another start date

By   /   March 16, 2017  /   News  /   No Comments

 

Photo illustration by Steve Wilson

VIABLE: Despite low natural gas prices and a study that shows that running the Kemper Project clean coal power plant on natural gas would be more cost efficient, Mississippi Power plans to ask customers to pay to run it on lignite coal.

 

Mississippi Power revealed its troubled Kemper Project clean coal power plant will miss yet another start date in a filing Thursday with the U.S. Securities and Exchange Commission.

Mississippi Power didn’t specify a date when the troubled $7.1 billion plant will become fully operational and said it will provide a revised schedule when it releases its next monthly report to the Mississippi Public Service Commission in April.

The plant — which is designed to convert lignite coal mined on site into a natural gas-like substance called synthesis gas to fuel its electricity-generating turbines — is nearly three years behind schedule. It was supposed to come online in May 2014.

The company blamed “certain tube leaks” in the syngas cooler on one of the plant’s two gasifiers, which convert the treated lignite to syngas, and inititated an outage to correct the problem. Previously, the company had to take the other gasifier offline on Feb. 20 to remove ash deposits.

RELATED: Why the Kemper Project can’t get started

The company also added a clause in its standard boilerplate language in the 8-K filing about cost increases and schedule extensions: “including additional costs to satisfy any operational parameters ultimately adopted by the Mississippi PSC.” This indicates that the regulatory body is taking a tougher stance on Kemper’s availability and efficiency before a rate filing is due from the company by June.

The clean coal power plant has seen cost increases for 21 consecutive months. The project, announced in December 2006, was originally estimated to cost $1.8 billion.

Here’s a timeline on the last six months of schedule delays:

  • Oct. 2 – Mississippi Power announces the plant will be operational on lignite by Nov. 30.
  • Oct. 28 – The utility insists that the plant will be operational by that date.
  • Oct. 31 – In an earnings call with investors, Tom Fanning, the CEO of Mississippi Power’s parent company (the Southern Company), says on the call that “as we moved through the startup process and we’ve knocked over these dominoes that you normally expect with the startup process, I think it has gone beautifully. This plant is going to work. It is working.”
  • Nov. 4 – The company announces in a news release that it has revised Kemper’s in-service date to Dec. 31.
  • Dec. 2 – In a news release, the company announces that Kemper’s commercial operation date is pushed back to January.
  • Jan. 31 – The company admits in a news release that the plant won’t be operational until late February.
  • Feb. 22 – Due to the need to shut down one of the plant’s two gasifiers for ash removal, the plant won’t go online until mid-March, according to a news release.
  • March 16 – The company reveals that Kemper will miss its mid-March start date.

Mississippi Power says that every schedule hiccup will cost the company an additional $25 million to $35 million for startup, maintenance and other costs.

Steve Wilson reports for Mississippi Watchdog. Contact him at [email protected] and on Twitter.

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Steve Wilson is the Mississippi reporter for Watchdog.org. Beginning his career as a sports writer, he has worked for the Mobile Press-Register (Ala.), the LaGrange Daily News (Ga.), Highlands Today (Fla.),McComb Enterprise-Journal (Miss.), the Biloxi Sun Herald(Miss.) and the Vicksburg Post (Miss.) Steve's work has appeared on Fox News, the Huffington Post and the Daily Signal. His bachelor's degree is in journalism with a minor in political science from the University of Alabama. Steve is also a member of the Mississippi Press Association and Investigative Reporters and Editors. He served four-plus years in the United States Coast Guard after his high school graduation and is a native of Mobile, Ala.