HOUSTON May 20 Southern Co's smallest
utility unit, Mississippi Power, named a new president on
Monday in response to pressure from state regulators concerned
about cost overruns at a controversial coal-gasification plant
under construction in Kemper County, Mississippi.
Mississippi Power said its board elected G. Edison "Ed"
Holland president and chief executive officer, replacing Ed Day
who was named to the job less than three years ago.
Mississippi Power said Day retired and that the change was
Tommy Anderson, Mississippi Power's vice president of
generation development, who oversaw the Kemper project, has also
left the company, a Mississippi Power spokeswoman said.
Anderson's replacement has not been named.
Last month, Mississippi Power said the cost to build Kemper,
a 582-megawatt, integrated gasification combined-cycle (IGCC)
plant, had risen by $540 million to more than $4.2 billion. That
amount includes the cost of a coal mine to supply the plant, a
carbon dioxide pipeline, financing and other costs.
Leonard Bentz, chairman of the Mississippi Public Service
Commission, said Monday's abrupt management change took place
after he called Southern Co Chairman Tom Fanning about two
months ago when his "communication relationship had broken down
with Mississippi Power."
"I just hit a brick wall and I had some concerns," Bentz
Southern said Kemper's higher price tag was the result of a
decision to use higher-quality pipe and to add additional
workers to complete the cutting-edge plant by a 2014 deadline.
Bentz said the commission will continue to scrutinize
Mississippi Power and how it provided information to regulators
regarding Kemper project costs.
"We are going to circle back around on everything that has
been addressed and I think there are also some other
communication breakdowns within Mississippi Power Co and we are
going to find out where they are and address those," Bentz said.
Mississippi Power's Holland apologized for the company's
"Information was asked for by the commission and
unfortunately we did not provide that information in the detail
requested," Holland said in an email. "I will see that it never
Bentz said he has a "wait and see" attitude following
Monday's management shake-up. "I don't think an issue gets much
larger than the president and CEO of the company abruptly
Bentz complimented Fanning's response but said the
commission will continue to hold Mississippi Power to the $2.4
billion cap it set for Kemper.
Mississippi Power's 185,000 customers saw bills jump
12-percent, or nearly $19, on an average monthly bill, tied to
early recovery of Kemper costs.
Fanning told investors last month that the Kemper experience
was "not representative of the kind of performance that Southern
Co delivers year in and year out."
"This is unusual performance for us and it's something that
we are going to work very hard not to repeat," Fanning said in