Mississippi Power CEO, Ed Holland, issued an op-ed discussing the impact of the Supreme Court’s ruling on rates. If the ruling stands, it will mean higher rates in the future.

Since the Feb. 12 Mississippi Supreme Court ruling regarding a 2013 rate increase approved by the Mississippi Public Service Commission for Mississippi Power’s Kemper County energy facility customers have had questions. I want to take this opportunity to make clear what the Supreme Court’s ruling means to Mississippi Power and its customers and what action Mississippi Power is taking to help lower costs of the Kemper project to customers.

In the ruling, the court mentioned customer refunds. Any refunds would not be available until a final court ruling is received following a rehearing process and the Mississippi Public Service Commission makes a determination.

There is a more troublesome aspect of the ruling. If the Supreme Court’s recent action is carried out, it will result in higher rates and bills to customers. We are committed to doing all we can to help ensure our customers are not hurt by the court’s decision.

Mississippi Power has worked hard to make sure our customers pay the minimum increase for the costs of the Kemper facility. On the two occasions the PSC certified the Kemper facility as the most economical, reliable source of new generation for the customers, it was estimated that the initial rate increase when the plant came on line would be approximately 35 percent. Since that time, the PSC and Mississippi Power worked tirelessly to find ways to mitigate this rate increase. The increases that were put in effect in early 2013 and 2014, totaling 18 percent, were designed to do just that. In fact, the PSC and Legislature demonstrated leadership in establishing a framework for the initial seven years after the plant came on line, that assured the increases to customers would not exceed 22-24 percent.

The Supreme Court’s ruling voids this plan. If the Court’s opinion stays in place and the refund is required, we will have little choice but to seek at least the original estimated amount of approximately 35 percent in rate increases.

Mississippi Power will file a rehearing with the court. It may take weeks, months or perhaps even a year for the court to decide if it will rehear our arguments and then conduct the hearings. If the court rules as they did before, then the matter will be remanded to the Mississippi Public Service Commission for them to decide how to proceed.

If the court determines a refund is appropriate, the PSC will decide the form in which it is provided.

Mississippi Power will fully comply with the PSC’s decision for any such refunds. And, if a refund is issued, it is likely that it will be a temporary relief as rates will increase if the Supreme Court’s action is executed.

As we go through the legal process, rest assured that Mississippi Power customers will not pay one penny more for construction costs approved by the PSC. The bottom line is that there is still too much to be worked through legally and through the regulatory channels for anyone to know precisely what the Supreme Court’s ruling will ultimately mean for Mississippi Power and its customers.

We will continue to update our customers and the community at large regarding the information we know about the ruling and provide updates as the ruling and its consequences become clear in the near future.
This ruling in no way affects the current construction and our scheduled completion date of the Kemper County facility. We continue to work diligently to complete the project and bring this innovative energy facility online so that we can continue to provide safe, reliable, affordable energy to our customers. Once online the facility will be a showcase for energy companies across the globe and something we all can be truly proud of here in Mississippi.

This project meets the demand for reliable, low-cost energy that is essential to produce jobs for Mississippi’s future. This is something the PSC recognized when it first approved the construction of the plant and that’s why Mississippi Power is committed – more than ever – to the success of this project for the long-term benefit of its customers.

Ed Holland
President and CEO, Mississippi Power

Mississippi Power has also issued a fact sheet on the Supreme Court action.