Mississippi Watchdog: Kemper Syngas Operations Could Raise Costs by 288%

When talking about the Kemper Project clean coal power plant, it’s easy to get fixated on the plant’s capital costs, now up to nearly $6.9 billion. However, according to the consumer advocacy organization, Mississippi Watchdog, there is an even more expensive iceberg lurking below the surface – the cost of operating and maintaining the newly converted syngas (synthesis gas made from lignite coal) facility.

Indeed, the Mississippi Watchdog asserted on October 18, Mississippi Power admitted in a filing (Docket No. 2913-UN-39) with the Mississippi Public Service Commission (MPSC) that the Kemper Project clean coal power plant could cost much more to operate and maintain than it originally estimated – up to $1 billion over the first five years the plant is in production.

That represents a 288 percent increase over the utility’s original projections for the integrated gasification combined cycle plant. An equivalent natural gas plant would have been much cheaper, both in terms of capital and operational costs. Mississippi Power calls Kemper a dual-fuel plant, but the facility’s turbines have increased generation capacity on natural gas, a difference of 148 megawatts (MW), the consumer advocate said.

Also, if the utility decides to run the plant primarily on synthesis gas made from lignite coal rather than natural gas, customers will get less generation capacity — 582 MW versus 732 MW – for a much higher operations and maintenance price tag for its 136,000 customers in the southern part of the state, Mississippi Watchdog said.

In testimony before the commission in 2013, Plant Manager Samuel Sumner, Jr., told the MPSC that further evaluations of the plant’s operations and maintenance costs might be required as more is learned during sustained usage of the facility.

The plant is set to become operational on syngas on November 30 after it was able to generate its first electricity from syngas last week.

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