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Mississippi Power to Suspend Lignite Coal Gasification at Kemper Plant


 

At the end of June, Mississippi Power Company notified the Mississippi Public Service Commission that it will immediately suspend lignite coal gasification operations at its Kemper County facility and the plant will continue operating as a natural gas plant.

Prior to this, the Mississippi Public Service Commission (PSC) moved to have Mississippi Power Company and other parties reach a settlement in the Kemper County Power Plant case to relicense the plant as a natural gas facility. Also, the PSC moved for a settlement that would, at a minimum, result in no rate increase to customers and shield customers from any risks surrounding the lignite coal portion of the plant. Parties were given 45 days to reach a settlement once the commission enters its order on the matter.

The facility in Gulfport was to be the newest large-scale U.S. power plant using integrated gasification combined cycle (ICGG) technology. However, since the 582-megawatt Kemper has been under development, it has been riddled with growing cost problems and project delays, as well as opposition issues.

The Liberty Mine, which is the sole supplier of coal to fuel the gasifier at the Kemper County energy facility, is not slated for amortization per the terms of the agreement now being considered by Mississippi Power, according to the PSC docket. Production levels at the mine, which is operated by Liberty Fuels Co., a subsidiary of North American Coal, were expected to increase gradually to full production of 4.5 million tons beginning in 2023, according to a Form 8-K filed by NACCO, which owns North American Coal.

“Should the decision to suspend operations of the gasifier become permanent, it will have an adverse effect on North American Coal's long-term earnings under its contract with Mississippi Power,” the company said in its filing.

NACCO spokeswoman Christina Kmetko said the situation was fluid and nothing had been finalized.

“Operations are continuing to support the customer,” she said. “We will continue to operate under our contract and support the customer as needed.”