“The collection of interest costs for the plant during construction will accomplish two important objectives,” said Moses Feagin, vice president and CFO. “One, to lower the overall cost of the plant for our customers, and two, to reduce the potential rate shock they would have otherwise experienced.” Since the PSC’s cost recovery denial, Mississippi Power has received a credit rating downgrade with a negative outlook. Timely recovery of financing costs is critical to the company’s ability to maintain financial health and have access to capital needed in its everyday operations as well as in emergency situations when customers need it most.
The $2.88 billion Kemper plant is scheduled to be completed by May 2014. Now a projected 15% over budget, the complex is one of only two IGCC plants under construction. Duke is building another ultra-modern, clean burning plant in Indiana.
The Sierra Club, which opposes the construction of any coal-fired power plant, no matter how clean burning, has fought the Kemper plant every step of the way. Now citing high costs and rate impacts, the anti-development group successfully challenged the commission’s 2010 approval of Kemper and has appealed the commission’s move to re-issue Kemper’s certificate in April. Thousands of construction workers are employed at the project site and an adjacent surface mine is being developed to supply lignite throughout the life of the plant.