Southern Co delays advanced coal plant to 2015 amid rising costs

Posted by Joseph R. Fonseca
Tuesday, April 29, 2014
logo

 

Southern Co will take a $235 million charge in the first quarter and delay the startup of its $5.5 billion coal-gasification power plant in Kemper County, Mississippi, the company said in a filing with regulators on Tuesday.

Southern Co, based in Atlanta, is scheduled to release its first-quarter earnings on Wednesday.

Southern has previously taken $729 million in charges related to more than $1 billion in cost overruns at the 582-megawatt Kemper County plant, one of only two integrated gasification combined-cycle (IGCC) plants in the nation.

Mississippi Power, Southern's smallest utility, owns the facility and plans to complete the gas-fired, combined cycle portion of the project this summer.

However, the in-service date for Kemper's complex gasification system has been delayed to the first half of 2015, one year later than initially planned.

"The company remains focused on working safely and tirelessly to complete the facility and bring it online for the benefit of customers for decades to come," Mississippi Power said in a statement.

The power industry has been closely watching progress at the Kemper plant. Because it will be able to capture carbon dioxide emissions, the Kemper plant has been cited as a model for future coal-plant design by the U.S. Environmental Protection Agency which has proposed strict limits on carbon pollution from coal-fired power plants.

However, Southern officials have asked the EPA to refrain from using Kemper as a standard for the industry because of its unique location.

Southern blamed the latest cost overrun on lower construction productivity due to adverse weather at the site, unexpected worker turnover and installation "inefficiencies" related to the complex piping in the gasification system.

Earlier this year, Southern reported additional construction costs of $184 million. On Tuesday, the company revised its cost estimate by another $61 million and added $135 million related to the delay in the expected in-service date.

With the $380 million increase, Kemper's price tag now exceeds $5.53 billion, more that twice the $2 billion figure announced when the plant was proposed.

Mississippi Power can only recover $3.8 billion of Kemper costs through customer rates and the sale of securitized bonds. Customers began paying higher rates related to the plant last year after a lengthy battle with state regulators.

Maritime Today


The Maritime Industry's original and most viewed E-News Service

Maritime Reporter May 2016 Digital Edition
FREE Maritime Reporter Subscription
Latest Maritime News    rss feeds

Finance

Defense Appropriations Bill Includes $1 Bln for US Icebreaker

The U.S. Senate Appropriations Committee’s FY2017 Defense Appropriations Bill has included $1 billion in funding to accelerate construction of a new polar icebreaker for the U.

Higher Capesize Demand Pushes up Baltic Index

The Baltic Exchange's main sea freight index, tracking rates for ships carrying dry bulk commodities, rose on Friday buoyed by higher demand for capesize vessels.

TT Club Reports Robust Financial Results for 2015

TT Club has announced its financial results for the year ended December 31, 2015, and AM Best affirms its A- (Excellent) rating for the 10th consecutive year.   Knud Pontoppidan,

Energy

GloMEEP Project Forges Ahead with Train-the-Trainer Workshop

A global Train-the-Trainer workshop on energy efficiency has been delivered in China (23-27 May), preparing the personnel needed to cascade knowledge on energy

Hercules Offshore Filing for Bankruptcy Again

Hercules Offshore Inc said it planned to file for prepackaged Chapter 11 bankruptcy, just six months after the rig contractor emerged from bankruptcy protection.

Strike Idles 38 Oil Tankers at Fos-Lavera

Some 38 oil tankers have been held up at the Fos-Lavera oil port in southern France, the country's biggest, including 25 at harbour, up from 12 the previous day,

News

GloMEEP Project Forges Ahead with Train-the-Trainer Workshop

A global Train-the-Trainer workshop on energy efficiency has been delivered in China (23-27 May), preparing the personnel needed to cascade knowledge on energy

Diana Charters Out Two Bulkers

Diana Shipping Inc. today announced that, through a separate wholly-owned subsidiary, it entered into a time charter contract with Bunge S.A., Geneva, for one of its Panamax dry bulk vessels,

Long Beach Port Maintains Strong Bond Rating

Fitch Ratings, one of the top three U.S. credit analysis agencies, has affirmed the Port of Long Beach’s “AA” rating on its outstanding debt. Fitch stated the AA rating — its highest for U.

 
 
Maritime Careers / Shipboard Positions Maritime Contracts Maritime Security Naval Architecture Navigation Offshore Oil Pipelines Salvage Ship Electronics Ship Repair
rss | archive | history | articles | privacy | contributors | top maritime news | about us | copyright | maritime magazines
maritime security news | shipbuilding news | maritime industry | shipping news | maritime reporting | workboats news | ship design | maritime business

Time taken: 0.1191 sec (8 req/sec)