Question: So a 15 percent rate increase for Mississippi Power has been approved, with an additional 3 percent expected next year to pay for the Kemper plant. Is that correct?

    Answer: Yes, and then there is a 4 percent rate increase that comes on after that. So, in general, you are talking about a 22 percent rate increase for customers.

    Q:  You have criticized the rate increases prior to the plant coming on line. What precedent is there for this?

    A:  None. Never. Ever. Never. No. The law had to be changed and I fought the law vehemently. I think it equates to, literally, corporate socialism — where you have customers who are paying in an increase power bill today for something they do not get any benefit out of today. When you have the great title of a monopoly — it’s always been a tried and true legal precedent of what we call the “used and useful principle.” Consumers in Mississippi never paid for public utility costs until whatever they are paying for was used and useful by the consuming public. The Mississippi Legislature passed what’s called the Baseload Act (which allowed for rate increases to pay for construction), and that’s what allowed for this to happen. Personally, I think the Baseload Act is unconstitutional. The Mississippi Constitution says the aid and credit of the state cannot be pledged for a corporation. There’s no doubt when you have agencies in state government, universities in state government, paying an increased power bill, they are pledging their credit  for the aid of Mississippi Power Company. I feel like it violates that provision of the constitution. But it passed. I testified in hearings and did everything I could to keep it from going into law but it did.

    Q:  It has been said the cost to ratepayers will be capped at $2.4 billion, with another $1 billion for stock. Can you talk about that?

    A:  Well, $2.4 billion was the original cost cap. They came back and said we can’t make it if we don’t get a 20 percent escalation. That got them to $2.88 billion. Then the Legislature approved a bond bill this year that would allow it go another $1 billion on top of that, so you are looking at $3.88 billion that would be paid for. The $1 billion in the bond would only be at the rate of the debt, probably around 3 percent so the company. You still have to pay the band. At the end of the day, there is no Tooth Fairy, there is no Santa Claus, that is going to come to Mississippi and give us this plant. For all the ideas and numbers that get thrown out there, it still has to be paid for and the people are going to have to paid for.

    You have 186,000 customers essentially paying for $3.88 billion. Those numbers just don’t work. In studies shown in the case, and one of the most egregious parts of this case, is that they filed those rate impacts secret. So the public could not know what the rate impacts would be while we were deciding the case.

    Q: Is this a done deal?

    A: No. We still have to look at the rate plan, so I can’t comment on that. We still have to look at prudence, so I can’t comment on that. What I can comment on is before the Mississippi Supreme Court right now – the second challenge to the case. As of yet, Mississippi Power has not been able to muster one vote on this Supreme Court – not once. Not one time have they been able to get a vote on this Supreme Court. It hasn’t been 5-4. It has been unanimous, 8-0, every time, because (Chief) Justice (William) Waller recused himself.

    Q: You have said this is experimental technology. Can you explain?

    A: This is an experimental plant in which the technology used is not used anywhere else in the world. Don’t let the smoke and mirrors of all their other plants that use lignite … yes that’s correct, there other plants that use lignite. But they do not use the trig technology which was developed by Southern Company, who will make the money off of it if it is sold, that’s the engine to the plant, and there is not another one up and running.

    I just felt the customer shouldn’t be the guinea pig. If the company developed the technology, let them go get private investors and if it works, hallelujah, we can buy power from them.

    Here are the facts, and this is just from 2010. As it stands, the technology today has only ran a total of 1,795 hours, which is equates to 75 days of run time at the Wilsonville experimental plant. Mississippi Lignite has been run at the rate of 5,610 pounds per hour at Wilsonville, whereas this project will be expected to run at 401,145 pounds per hour. Synthesis gas (taken off lignite and burned) has been running at the rate of 28,000 pounds per hour. The proposed project at Kemper County would be 1,311,100 pounds per hour. Both the lignite and the sand gas have only run 2 percent of the total project time.

    I just don’t think 2 percent is enough to sign up captive customers on an experiment.

    Q:  If this doesn’t work, what does the state of Mississippi do?     

    A:  I wish I had you an answer. I don’t know. As much as I have voted in the past, every turn against this, in my heart of hearts, you gotta hope and pray the thing at least turns on and puts something out. What if it doesn’t? What if you get to the point where it gets built and you realize, oh my Lord, we have to spend another $2 billion to get it to do what we want? To me, in the real world, that risk is on the people who are going to make money on it, not on those who are going to get taken.

    

    Q:  What’s next?

    A:  I think what you have looming out there is the Supreme Court. If the Supreme Court comes back and overturns it again that would put it all on Mississippi Power. We are at a too big to fail scenario with this. Nobody wants to say it and you are not going to hear it from anybody’s mouth. But Mississippi Power Company’s total assets, net utility plant, the day in which this order was signed was $1.208 billion. Go look those facts up. What if this thing won’t work? Even if the thing fires up and does everything they said it will do, you still have to pay for the thing.     

    Q:  How bad do we need additional power?

    A:  I think there’s no doubt in my mind as the state grows you are going to have a need for additional power. We set this case up in two separate proceedings. The first was to look at whether or not there was a need. It’s as if I said to you I need to go from here to Tuscaloosa and I need to find me a way to get there. Well, do you buy a Chevrolet with manual windows, the cheapest thing you can get? Or do you go buy a Cadillac Escalade?

    I voted to say that there was going to be a need for additional power at the rate we are going in Mississippi. Common sense tells you there will be as the state grows. The question becomes, “How do you fill the need?” And I felt like we could do things through energy efficiency, through other types of power that would have made more sense and less costly to ratepayers. The idea that I hear put out that this is somehow a great capital investment in Mississippi is just, honestly, laughable. When you are taking billions of dollars out of the economy of the state, that’s not like you and I getting together and having a company and going to Alabama and putting in a shop. We are taking our private money and opening a building. This is sucking money out of the economy of Mississippi to pay on power bills for rate increases that are already in effect. And if the rate increases on the table are approved, then they will obviously be paying for that. To me it is anything but an economic development project when you are sucking out of the economy of Mississippi billions of dollars.

    Q: Just to be clear, we are not talking about rate increases for just Mississippi Power. We have a co-ops that buy power from Mississippi Power don’t we?

    A: That’s exactly right. The co-ops are in a little federal litigation about the costs that are going to be borne by them. They are going to own 15 percent of that plant out there. That is going to push those costs out to other people in Mississippi who are not Mississippi Power customers.