Bentz: The whole Kemper story is not getting told
Bentz disagrees with the notion that he is the one Mississippi Power needs to convince to get a different ruling on the plant. Bentz said he and Posey both favor the plant but are also looking out for ratepayers’ interests.
The commissioners’ views do differ, however.
Posey said in an April 29 Mississippi Business Journal interview that he wished the Commission “could have had an order that wouldn’t have been quite so tight on Mississippi Power.” Posey said he was specifically referring to the order’s stipulation of a $2.4-billion cost cap as well as the denial of Construction Work in Progress (CWIP) in rate base.
CWIP permission would allow the company to charge ratepayers for financing costs before the plant becomes operational. Mississippi Power is adamant that CWIP is necessary in order for the company to be fiscally responsible. The allowance would keep up the company’s credit rating, which would allow it to have access to capital and keep interest rates low, saving customers approximately $500 million over the plant’s life.
Posey said: “I think at some point in time … we’re going to have to come back and visit the CWIP provision … I think that’s the way the majority of plants are being built these days. In the long run — it does have some up-front costs — but in the long run, there’s a tremendous amount of savings that can be there. I’m very much for the plant, and hopefully we can get that done.”
Bentz, on the other hand, stands by the $2.4-billion cap and is skeptical of whether CWIP is in the best interest of ratepayers.
“I am 150 percent for this plant. What I am not for is strapping the ratepayer when they are not able not to afford this plant. If they can’t pay their bills, it does them no good … I am struggling with the economics of the plant,” Bentz said.
“I am 100 percent for allowing this plant to be built, but in order to do that you have got to put some type of stipulations on the company. We live in a totally different day and age than 40 years ago when they built plants (in Mississippi) … As a regulator you have got to make sure that you’re not going to end up with some type of prices at the end of the day where the ratepayers are not protected.”
Regarding MPC’s assertion that restrictions in the order would make building the plant too risky for stockholders, Bentz said, “Didn’t anyone ever think about what might be too risky for the ratepayers?”
Bentz said he fully understands Mississippi Power’s argument that it needs CWIP authority in order to have capital to build the plant, but his job as a regulator is to find the balance between the ratepayer and the utility. “We want the power company to prosper, but at the same time, ratepayers’ interests must be taken into account … Everybody and their grandma knows that we are in tough economic times. I’m having trouble getting the power company to understand that.”
MBJ
5/17/10
Magnolia Tribune
