Jackson Free Press

Friday's decision from the Mississippi Public Service Commission on Mississippi Power's request to raise electric rates could severely hamper the project.

The three-member PSC voted unanimously to reject Mississippi Power Co.'s request to raise electric rates. Mississippi Power said the increase was needed to cover $58.6 million in construction-related debt on its $2.76 billion power plant, now under construction. The hike would have averaged about $20 per month per customer.

Southern District Commissioner Leonard Bentz explained his rationale for denying the increase by saying that although he supports the project, he doesn't want to raise rates while litigation is ongoing.

The Kemper plant, which proposes to burn lignite coal using internal gasification combined-cycle technology, has been embroiled in legal controversy since Mississippi Power announced plans to build the plant.

In 2010, the PSC voted to cap the cost of building the generating station at 2.4 billion, but then upped the cap to $2.88 billion a month later. The Mississippi Sierra Club pursued the matter all the way up to the Mississippi State Supreme Court to block lifting the cap. The state's high court agreed with the Sierra Club and remanded the issue back to the PSC for consideration. In a brief meeting this spring, commissioners again let Mississippi Power continue construction, which prompted another Sierra Club lawsuit.

Louie Miller, executive director of the Mississippi Sierra Club, said the lawsuit that the organization filed in Harrison County Chancery Court could take up to 18 months to resolve.

Mississippi Power, which Atlanta-based Southern Co. owns, has indicated that the company might not be able to afford the plant unless it can up the cap on costs. Miller believes the PSC's recent decision could jeopardize the project.

"I'd sure as hell rather be in my shoes than Mississippi Power's shoes right now," Miller said.