ATLANTA — In Mississippi, the Southern Co. utility took financial losses when the cost of building a new power plant went over budget. In Georgia, another of the company’s projects is going over budget, but it has not yet taken a financial hit.
Southern Company subsidiary Mississippi Power promised utility regulators that it would charge its customers only for $2.4 billion in costs for building a coal-fired power plant in Kemper Country. Those customers will also have to pay off another $1 billion in bonds for the project, though the utility cannot make a profit off that borrowed money.
The utility’s deal in Mississippi has become a point of debate as Georgia regulators consider who should pay for the increased cost of building two more nuclear reactors at Plant Vogtle (VOH’-gohl), southeast of Augusta. Public Service Commissioner Tim Echols said he wants Southern Co. subsidiary Georgia Power to consider a Mississippi-style deal here, and Georgia regulators are carefully tracking financial developments in Mississippi.
Echols said he was interested in the idea of a project spending cap.
“I’m sure when they made that deal they didn’t think they were going to over the cap, but they did,” Echols said.
Georgia Gov. Nathan Deal said this week that it would be a “good solution” if Southern Co. could absorb more of the costs.
Opponents of both Southern Co. projects say the settlement agreement in Mississippi increases the political pressure on Georgia Power to accept losses rather than pass all extra costs onto customers. Though the projects are not perfectly comparable because of differences in technology and customer rates, the Mississippi agreement created a political precedent, said Jenna Garland, a spokeswoman for the Sierra Club’s Beyond Coal Campaign.