Southern Company’s Dream

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Bigger Pie Forum | Southern Company’s Dream | BPF
 
The Southern Company’s dream of a multi-billion plant to transform lignite into electricity will be history in four short years.
According to a filing with the U.S. Securities and Exchange Commission, the gasifiers and chemical plant will be scrapped by 2024.  Remediation of the Liberty lignite mine will be completed this year.  Southern Company shareholders wrote off $6 million in costs and when the scrap man’s torch cuts away the final piece of steel in Kemper County, it will be the closure on a fatally-flawed concept.  The Department of Justice is investigating whether the company lied to investors about problems with the $7.5 billion plant.
The plant ultimately generated more controversy and lawsuits than megawatts of electricity.  It was supposed to provide 40 years of cheap, clean electricity from lignite mined on the site.  Instead, Kemper is now a more expensive natural gas plant ($1 billion paid for by ratepayers) that should not have been constructed in the first place.
Southern’s dream of a clean coal future borne on the backs of a ratebase in south Mississippi is dead.  In the deal, Mississippi Power customers avoided double-digit rate hikes that would’ve likely torpedoed the Coast’s economy for decades.  The Georgia-based Southern Company tried to use its genius for rent-seeking by offsetting the massive costs onto the costs of taxpayers.  It was a technological leap that couldn’t be made.
The administration of then-President George W. Bush started a Clean Coal research program that provided grants for utilities to build environmentally friendly power plants to be fueled with abundant coal.  Southern received a grant in 2004 to build a clean coal plant near Orlando, Florida.  The plant would use gasification to could turn low-energy, high-moisture grades of coal (such as lignite) into a gas that could generate electricity.

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