Southern Company

New Fraud Allegations Emerge at Troubled 'Clean Coal' Project As Southern Co. Records Multi-Billion Loss

Southern Company CEO Tom Fanning

Southern Co. is accused of fraudulently misrepresenting the prospects for its troubled “clean coal” project in Kemper County, Mississippi in several legal filings this summer.

Southern announced in late July that it was shuttering the troubled “clean coal” part of Kemper after construction ran years behind schedule and the company spent $7.5 billion on the 582 megawatt power plant — over $5 billion more than it first projected.

In a lawsuit filed today, Brett Wingo, a former Southern Company engineer, alleges he warned the company's top executives that it would not be possible to meet key construction deadlines. Management responded by retaliating against him, the complaint asserts, and Southern continued to assure investors and the public that Kemper's schedule and budget targets would be met, then blamed unpredictable factors like the weather when those goals were missed.

'Clean Coal' Officially Dead in Mississippi as Southern Company Battered by Kemper Fallout

By Dan Zegart, crossposted from Climate Investigations Center.

Clean coal officially died in Mississippi today as state regulators voted unanimously to issue an official order denying further money for the Kemper coal plant and beginning a settlement process with its builder, Southern Company.

The order provides a legal framework for the state Public Service Commission's June 21st vote proposing the plant continue to operate on natural gas, as it has since August 2014, instead of spend additional money to try to use Kemper's non-functional multi-billion dollar gasifier to generate power from lignite coal.

“The commission today is taking firm steps towards resolving all substantive matters associated with the Kemper Project,” says the 35-page PSC order.

These Companies Plan to Expand Coal Power Worldwide by 43 Percent

Coal protesters in Victoria

In Paris in 2015, more than 195 nations committed to slowing the rise of global warming to less than 3.6°F (2°C). In 2016, renewable energy saw unprecedented growth around the world. 

Yet in 2017, more than 120 companies have plans to build new coal-fired power plants (or expand existing ones), increasing coal capacity by roughly 43 percent across the globe. That’s more than 840,000 megawatts (MW) of additional coal power. 

Some of those expansions are slated to occur in countries that don’t yet have any coal power, including Egypt and Malawi, likely locking them into at least 40 years of polluting infrastructure.

This is according to an analysis just released by the German environmental nonprofit Urgewald, which states that if all of these coal expansion plans go ahead, the resulting average rise in global temperatures would be a blazing 7.2°F (4°C).

Mississippi Regulators Veto Any More Money for Southern Company's Kemper 'Clean Coal' Plant in Stunning Vote

By Dan Zegart, originally published at Climate Investigations Center

In a historic vote this morning, Mississippi state regulators slammed the brakes on the Kemper coal power plant, saying they will refuse to ask utility customers to pay anything for Kemper's non-functional multi-billion dollar “clean coal” gasification technology and will re-designate the plant as a natural gas facility.

In a joint press release explaining their unanimous decision, the three Mississippi Public Service commissioners said they seek a solution that “eliminates ratepayer risk for unproven technology and assures no rate increase to Mississippi Power customers,” and that they want Mississippi Power, the Southern Company subsidiary that built Kemper, to consider rolling back existing rates.

“I think it's high time we finally turn the corner on this project and also strongly protect our ratepayers, who should only have to pay for what actually delivers electricity,” said PSC chairman Brandon Presley in an interview. Presley was, until recently, the lone opponent of a bloated, runaway project that saw costs jump from $2.3 billion in 2010 when work began to $7.5 billion now. 

Brain Drain: Engineers and Managers Flee Southern Company’s Troubled Kemper ‘Clean Coal’ Plant

This is a guest post by Dan Zegart of the Climate Investigations Center

With builder Southern Company still promising that the Kemper power plant will go online soon, a group of key engineers and managers who work on the plant's so-far-inoperable gasifier has left the company.

Earlier this month, Southern Company posted a cluster of want ads on its web site for a “gasification owner,”  a “refinery technician-mechanic,” a “refinery technician-entry level,” and a “gasification technician.”

Those four positions are located at the gasification island, home to the patented TRIG technology developed by Southern Company and Kellogg Brown & Root that is supposed to turn lignite coal from an adjacent mine into a cleaner burning syngas to produce electricity.  The project's twin gasifiers, however, have been troubled by frequent shutdowns and lengthy repairs.

Congressional Energy and Climate Committees Are Loaded with Ex-Fossil Fuel Lobbyists

U.S. Capitol building

Though the U.S. Congress has been in session for two months, much of the policy action which has taken place since Donald Trump assumed the presidency on January 20 has centered around his Executive Orders.

As some have pointed out, Trump's first speech in front of a joint session of Congress on February 28 can be seen as a reset moment, with the clock ticking on Republicans to deliver on promises made to voters in the 2016 election. In the energy and environment sphere, those efforts will likely center around gutting climate and environmental protections, and much of it will be carried out by congressional committee staffers. 

A DeSmog investigation has revealed that many Republican staff members on key committees are former fossil fuel industry lobbyists, which could help fast-track the industry's legislative agenda in the weeks and months ahead. In total, 15 staffers on the eight main energy and environment congressional committees previously worked as industry lobbyists on behalf of oil, gas, mining, coal, petrochemical, and electric utility interests. 

Southern Company Says Its Delayed Kemper Power Plant Not Viable as Coal Plant

Aerial view of Kemper coal gasification plant under construction

This is a guest post by Dan Zegart, originally posted on Climate Investigations Center.

In an apparent first salvo in a public relations campaign to shift blame for the Kemper power plant boondoggle away from himself and corporate management and onto state regulators, Southern Company chief executive officer Tom Fanning admitted this week that the Kemper plant is not economically viable as a coal-burning power plant.

The startling reversal came during an earnings call Thursday at a time when Southern faces intense scrutiny from federal and state regulators and the Securities and Exchange Commission (SEC) — and as its Mississippi Power Company subsidiary, the plant's owner, faces a Moody's downgrade over Kemper's skyrocketing costs and failure to operate despite being three years past its promised operating date.  Southern took a 27 percent hit to its fourth quarter net income thanks to Kemper schedule delays.

Southern Company's Kemper Coal Plant Could Get Billions in Tax Credit Bail-Out

By Dan Zegart from Climate Investigations Center

If Donald Trump really wants to get rid of federal corporate welfare, he should be frantically tweeting against a congressional plan that could send billions to the grossly mismanaged Kemper power plant by expanding tax credits for injecting carbon dioxide into oil fields.

These so-called “45Q” tax credits would get richer and could even become a permanent part of the federal tax code depending on which of three bills now being considered by Congress becomes law. 

And that could result in the so-called “clean coal” Kemper facility that utility giant Southern Company is building in eastern Mississippi getting between $789 million and $4.5 billion, according to a new report co-authored by Friends of the Earth and Taxpayers for Common Sense — Coal Tax Subsidies: A Boon For Kemper.

Weeks Before Dakota Access Pipeline Protests Intensified, Big Oil Pushed for Expedited Permitting

Dakota Access oil pipeline installation between farms, as seen from 50th Avenue in New Salem, North Dakota.

In the two months leading up to the U.S. Army Corps of Engineers' decision to issue to the Dakota Access pipeline project an allotment of Nationwide 12 permits (NWP) — a de facto fast-track federal authorization of the project — an army of oil industry players submitted comments to the Corps to ensure that fast-track authority remains in place going forward.

This fast-track permitting process is used to bypass more rigorous environmental and public review for major pipeline infrastructure projects by treating them as smaller projects.

To Fight Clean Power Plan, Fossil Fuel Companies Paid for Private Meetings with Republican State Prosecutors

Republican Attorney General Scott Pruitt of Oklahoma.

Just one week before Republican state attorneys general asked federal courts to reject the EPA’s Clean Power Plan, which requires states to regulate emissions from electricity generation, they met privately — for a handsome fee — with energy companies Murray Energy and Southern Company, which are also suing to halt the plan’s implementation. 

The timing of the secret meetings and financial contributions reveal what appears to be a well-coordinated effort to hobble the Obama administration’s climate policy agenda.

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