Mississippi Power Co. on Friday announced a settlement agreement with Mississippi Public Utilities Staff and other parties for the $7.5 billion Kemper County power plant.

According to a statement from the utility, key parties have agreed on final terms, which are pending review and approval from the Mississippi Public Service Commission.

The PSC on Friday canceled a hearing scheduled for Monday to “encourage a negotiated settlement” for the plant.

“The Commission will take up consideration of the December 1 stipulation, and finds that additional time is required before a hearing on the December 1 Stipulation can be held,” the PSC order said.

“This agreement represents significant compromise from all parties involved, but is an important step to settle all costs remaining on the Kemper project,” said Mississippi Power President and CEO Anthony Wilson. “Putting the gasifier portion of Kemper that did not meet our expectations behind us is in the best interest of our customers, company and the state. We are pleased to continue operating an efficient natural gas facility at Kemper which has been serving our customers for more than three years.”

Other parties involved in the settlement include Chevron and federal executive agencies, the statement said. Mississippi Power officials maintain that this agreement meets the PSC’s directives from earlier this year, including removal of risk to Mississippi Power customers for the gasifier and related assets, no customer rate increase to Kemper and operation of the plant as a natural gas facility.


In the settlement terms of the filing, the annual revenue requirement will be $112.6 million, a decrease from the former rate of about $126 million. The filing also states that the “stipulated total company Kemper CC capital investment” is equal to about $853 million.

“If this stipulation is approved, we expect significant changes to our business,” Wilson said. “As we adjust to this considerable loss of revenue, our top priority will be to maintain safe and reliable service to our customers.”

The issues surrounding the plant began when the PSC on July 6 ordered Mississippi Power and the other parties to reach a settlement within 45 days.

After several months, parties were unable to reach an agreement, prompting the PSC to set the December hearing when commissioners would write an order deciding how much customers should pay.

Atlanta-based Southern Co., the parent company of Mississippi Power, announced earlier this year that it would absorb an additional $2.8 billion in losses from the Kemper County power plant’s lignite coal operation — bringing the total to nearly $6 billion in losses.

Charges recorded through May 2017 were $3.07 billion.

No securities fraud case 

Late Friday afternoon, Southern Co. said the U.S. Securities and Exchange Commission has ended its securities fraud investigation into whether the utility misled investors about progress at a Mississippi power plant and won’t recommend any enforcement action.

The Atlanta-based parent of Mississippi Power Co. made the statement in a Friday securities filing.

The company still faces lawsuits from shareholders, a former employee and a former business partner over claims that Southern lied about problems at the plant, concealing delays and overruns.