09/01-17 15:08


Kemper CCS plant on track for Jan. startup


Southern Co.'s next-generation coal plant in Mississippi remains on track to fully start up by the end of this month, the company said Friday.

Southern Co.'s next-generation coal plant in Mississippi remains on track to fully start up by the end of this month, the company said Friday.

The next few weeks will give the company and its Mississippi Power unit enough time to integrate all the complex systems with both combustion turbines, according to a filing with the U.S. Securities and Exchange Commission. This will let the power plant generate electricity by using synthetic gas.

Once fully operational, the Kemper County energy facility will be the first large coal-burning power plant in the United States to capture and store the majority of its carbon dioxide. The power plant will turn lignite coal into synthetic gas and is expected to capture 65 percent of the carbon dioxide from it.

Southern and Mississippi Power file monthly reports to shareholders and state utility regulators about the project's cost and schedule. Friday's report is for the November period.

"As we reported last month, we felt like January would be the month for the commercial operation date," Mississippi Power spokesman Jeff Shepard said. "This filing just confirms that."

Despite its promises of a new future for coal, Kemper has been mired in significant delays and cost increases. The project's original startup date was May 2014, and the price tag was under $3 billion.

Pushing Kemper's startup date until the end of January has added $51 million, bringing the total cost to more than $7 billion. This includes $34 million that Southern Co. will absorb and $17.5 million that Mississippi Power is allowed to ask to recoup from customers.

The project received $136 million from the Energy Department, shaving that total to $6.9 billion.

Southern has taken back-to-back charges totaling $2.6 billion. Mississippi Power can ask the Public Service Commission to collect $4.2 billion from its 186,000 customers.

"The commission will have the ultimate say on that," Shepard said.

Kemper has been running on natural gas for more than two years. Each of the two gasifiers has been able to produce synthetic gas from coal. They also started producing electricity.

The next few weeks are critical if Southern and Mississippi Power want to meet the in-service date. The utility must synchronize operations of both gasifiers, and if this does not happen, the date "may require further revision," the filing said.

"This is one part of the process; it's going to have to run for a period of time," said Paul Patterson, a utility analyst with Glenrock Associates LLC. "It's positive that we haven't seen any pushback [in the latest filing], but you have to cross your fingers given the long and bumpy road."