Oct 30 U.S. power company Southern Co
delayed the planned start-up date of its 582-megawatt Kemper
coal-fired power plant in Mississippi to the fourth quarter of
2014 and boosted the estimated cost of the project again, to
Southern said in a federal filing late on Tuesday that its
Mississippi Power unit had revised the start-up date due to
"lower-than-planned installation levels for piping as well as
abnormally wet weather."
Kemper will use a new type of integrated gasification
combined cycle (IGCC) technology to turn lignite coal into
synthetic natural gas.
The plant will also capture at least 65 percent of the
carbon dioxide it produces as a byproduct. The carbon dioxide
will be piped to an oilfield and used in oil production.
Only a couple of other IGCC plants are in service in the
United States - in Indiana and Florida. Those plants do not
capture carbon dioxide emissions.
The U.S. Environmental Protection Agency, as part of a
proposal to limit carbon emissions from new power plants, has
pointed to Kemper as an example of how new coal-fired plants can
be built with capture-carbon and storage systems.
Earlier this month, Southern said it had revised the plant's
start-up from May 2014 to "later in 2014." In July it boosted
the cost estimate for Kemper to $3.87 billion. Construction of
the plant started in 2010.
Reuters has estimated the project's total cost will climb to
about $5 billion when federal grants, the cost of the coal mine,
the carbon dioxide pipeline system and other items are included.
Despite the cost overruns, Southern said on Tuesday that
Mississippi Power does not intend to seek any joint owner
contributions or rate recovery for any costs related to the
construction of Kemper that exceed the state's $2.88 billion
Southern said it and Mississippi Power recorded a pre-tax
charge of $150 million ($93 million after tax) related to Kemper
in the third quarter, in addition to charges totaling $990
million ($611 million after tax) recognized previously.
Southern also warned that "Mississippi Power could
experience further schedule extensions and/or construction cost
increases with respect to Kemper."
"To the extent it becomes probable that additional costs
will not be recoverable, Southern and Mississippi Power will
have additional charges to income, and such charges could be
material," the company said.