I lost the bubble on Southern Corporation's Kemper project. Apparently the last time I posted a note about the Kemper "clean-coal" project was October 18, 2017, about a year ago, when I thought the project was still underway. I was wrong. See below. [I really did lose the bubble on this one: I actually noted in June - July 2017 that the Kemper "clean coal" project was shut down; the plant would be natural gas only.]
From a post dated October 16, 2015 (about three years ago):
More Sticker Shock
Southern Company / Kemper
Who was it that said, "a sucker is born every minute"?
So, what is the status of the Southern Company / Kemper project? It was shut down -- according to a June 28, 2017, article in The Atlanta Journal-Constitution:Just when I thought it could get no more ridiculous, I was sent this story by a reader. First, for background, re-read the Kemper story, the cost of "clean coal" in the US:Note: at $6.1 billion this was three times more than expected; now it's up to $6.3 billion.
This is a 582-megawatt plant. So, $6.3 billion (and still rising) / 582 MW = $11 million /MW. Remember, even the most expensive solar energy / wind energy project seldom gets above $3 million / MW and even at $3 million / MW, that's outrageous -- in the US.
Southern Company is suspending efforts to get a troubled Mississippi plant running properly that had been touted as the future for “clean coal” power plants.
The Atlanta utility company said Wednesday it is “immediately suspending start-up and operations activities” for the coal gasification unit at its Mississippi Power subsidiary’s Kemper plant.
The power plant, which also burns natural gas, will continue operating using that fuel.But we certainly haven't heard the last of Southern Corporation boondoggles.
The decision marks a huge reversal for the first-of-its kind plant, which aimed to burn cheap lignite coal more cleanly than conventional plants. But the $7.5 billion plant was billions of dollars over budget and years behind schedule, and still not working properly.
Southern’s action follows a decision last week by the Mississippi Public Service Commission to order the company to pull the plug on the project and absorb billions in costs.
A reader noted this today, from oilprice: Southern Corporation now estimates it will cost $28 billion to complete a Georgia nuclear project, twice the original estimate of $14 billion. From the story:
Southern Company's Georgia Power subsidiary announced yet another increase in the estimated cost to complete the Vogtle 3 and 4 nuclear units.
At this moment this is the only ongoing nuclear construction project in the United States. Georgia Power has raised its cost to complete the nuclear project by 15 percent.
This pushes the final cost estimate for these units to almost $28 billion.
Perhaps more significant for investors, Southern's management agreed to write off almost $1.1 billion of Vogtle costs, rather than attempt to charge ratepayers for the expenditures.
Later this fall, all owners will vote on whether to continue the project.
These revised cost estimates indicate that total cost of the two units could approach $28 billion upon completion. Back in 2012, when the Georgia Public Service Commission regulators approved them, the cost estimate was $14 billion. This is a 100 percent cost increase over initial estimates and represents incremental financial risk for investors.Wow, there certainly seems to be a pattern here.
For the Kemper (Mississippi) "clean-coal" project:
- triple the original price estimate, $6 billion vs $2 billion
- then the "clean-coal" project shut down
- from $14 billion to $28 billion
- later this fall, owners will vote whether to continue this project
I was surprised and dismayed that the writer of the oilprice article failed to mention the Kemper project. He is obviously wearing blinders and only looking at this story as an "expensive" nuclear power plant story.