Mississippi Power files for rate increase
Some Scott County residents and businesses could be facing higher power bills in 2018.
Mississippi Power has filed notice that it plans to increase prices by about $11.45 per month for the typical household.
The state Public Service Commission must approve the increase for the company’s 187,000 customers in 23 counties in southeast Mississippi.
Mississippi Power’s residential rates are already about 20 percent higher than Entergy Mississippi, which covers the western half of the state.
Nicole Faulk, vice president of customer services, said in testimony filed with the PSC that the increases are needed to maintain the level of service it provides customers. She said they have kept operations and maintenance costs relatively flat over the past five years, but costs have risen and electric use has been “stagnant,” with about 0.1 percent sales growth from 2013 to 2018.
She said the company has reduced its workforce by 8 percent since early 2016 and they’re 3.2 years behind on their tree trimming schedule to keep limbs off high-voltage power lines.
Mississippi Power lost $48 million in 2016, according to its annual financial report. It’s a subsidiary of the much larger Southern Company, which is based in Atlanta.
“MPC has seen a decrease in average daily use for residential customers for a number of years, consistent with a national trend in electricity sales,” Faulk said. “Cost pressures are resulting from several factors including aging infrastructure, changes in OSHA regulations, changes in technology and cybersecurity requirements, compliance with regulatory requirements related to the bulk electric system, delayed maintenance and vegetation management, and changing customer expectations.”
The annual rate review requests an estimated increase of $6.85 per 1,000 kWH, which is a typical monthly household usage.
On its annual fuel filing, Mississippi Power estimates an increase of $4.60 per 1,000 kWh. By law the company does not make a profit on fuel but passes its costs on to customers.
The rate increase being considered is separate from that regarding the $7.5 billion Kemper County power plant. Mississippi Power initially planned years ago on that plant generating power using coal gasification and passing the costs onto customers. But the technology didn’t work as promised, a sharp decrease in natural gas prices made that method of generating power inefficient and a long citizen and media campaign against the project led to new members of the three-man PSC being elected who are less favorable to the company.
In June, the PSC told Mississippi Power to begin negotiations with regulators, saying it should run on natural gas and not coal gasification and that customers wouldn’t be on the hook for the nearly $6 billion in costs related to building the coal gasifier, according to Associated Press reports. The PSC and Mississippi Power are still in negotiations about how much of the costs of the natural gas portion of the Kemper plant to pass on to customers. The PSC in 2015 previously approved a 15 percent rate increase to pay for part of the natural gas plant.