Mississippi utilities seek higher rates as gas prices rise

Dive Brief:

Both Entergy Mississippi and Mississippi Power Co. have asked regulators to raise rates in order to help pay for higher fuel costs, in part the result of the rising cost of natural gas.
Mississippi Power is seeking a 4% increase in its Performance Evaluation Plan base-rate review and 4.5% increase in fuel costs, for a total increase of 8.5%. An average residential customer would see an increase of $11.45/month. Those increases are separate from the utility's efforts to recover some costs related to the Kemper County "clean coal" power plant.
At Entergy Mississippi, officials told the Associated Press that they misjudged fuel costs last year and will need to recover $62 million. That would raise average bills from $104/month to $114/month, beginning February.

Dive Insight:

The rate increase requested by Southern Co.'s Mississippi Power is separate from the utility's bid to recover Kemper costs, but that too is likely to hit a customer's bottom line.

AP reports Southern agreed to write off most of the $7.5 billion in costs but will seek to recover the remainder from ratepayers. The 582 MW plant was designed to convert locally-mined coal into a synthetic gas and capture over half of its carbon emissions, but after years of delay and rising costs, the utility resorted to running the facility on gas instead.

Originally estimated at $1.8 billion, Kemper's cost great to $7.5 billion project over the course of many years. Its failure is an expensive hit for Southern, but is also being viewed as a death knell for "clean coal" projects.

In a statement, Mississippi Power said its rate request "is not designed to address major capital costs such as the addition of new generating plants, like the Kemper County energy facility, or major environmental control equipment."

“We have been able to provide our customers with industry-leading customer service and performance without asking for a rate increase over the last four years,” Mississippi Power President and CEO Anthony Wilson said in a statement .“While our employees have found efficiencies in our operations company-wide, these filings are necessary to deliver the level of service our customers expect.”