Southern Company (SO) is playing the CWIP game of charging customers for electricity they won’t for years with coal in Kemper, Mississippi, not just with nuclear at Plant Vogtle in Georgia. Maybe we should elect some new Georgia Public Service Commissioners so we won’t see the kind of behavior Mississippi’s PSC has turned to.
Cassandra Sweet wrote for Dow Jones and WSJ 25 July 2012, 2nd UPDATE: Southern Co. Second-Quarter Profit Up as Economy Improves,
The company is proceeding with construction of a $2.88 billion advanced-coal plant in Mississippi, despite a decision last month by state regulators to deny a $55 million rate increase the company requested while a related court case is pending. The company’s Mississippi Power unit has filed an appeal of that decision with the state Supreme Court, and argues that without the rate increase it won’t be able to cover certain project expenses that could boost its customers’ future costs.
Mississippi’s Public Service Commission actually denied that rate increase, partly due to opposition from AARP, Sierr Club, and other concerned organizations and citizens. Imagine Georgia’s captive PSC doing that! Mississippi Power took it all the way to the MS Supreme Court, challenged by MS Sierra Club, and that Supreme Court also denied the rate increase. According to MS Sierra Club:
Sierra Club has challenged the dirty, expensive, and unnecessary Kemper County Coal Plant project from its inception, successfully arguing before the Mississippi Supreme Court that the PSC had improperly and illegally issued permits to Mississippi Power for construction and development of the project. After the Supreme Court decision, the PSC rubber stamped approval for the plant in a 45-second hearing with no public comment. (I guess somebody explained to them who they really work for.) Sierra Club appealed that decision to state court. The PSC denied the rate increase pending the outcome of the Club’s challenge to Kemper’s permit.
So Mississippi Power customers may yet have to pay for coal they don’t want even before they get any electricity from it (if ever), just like Georgia Power customers have to pay for construction of new nukes at Plant Vogtle years before they see any electricity from there (if ever).
That’s how SO can show big profits even as its sales declined:
Southern Co. reported a second-quarter profit of $623 million, up 3.2% from $604 million a year earlier. Earnings per share were flat, at 71 cents, due to more shares outstanding in the latest quarter. Excluding a two-cent gain related to insurance recoveries in the quarter, earnings were 69 cents a share. In January, the company predicted earnings of about 65 cents a share.
Analysts polled by Thomson Reuters had predicted earnings of 68 cents a share and revenue of $4.76 billion.
Total energy sales fell 3%, while kilowatt-hour sales to retail customers fell 1.9%.
Regulatory capture, it’s profitable! For SO executives: not for customers of Georgia Power or Mississippi Power. And not for the rest of us who have to deal with the pollution and climate change caused by SO’s coal plants. It’s time for a change.