Mississippi Power has pushed back the in-service date of its much-delayed Kemper County integrated gasification combined cycle (IGCC) plant by a month, to October 31, 2016.
Initial production of syngas at the plant began on July 14, and testing continues of gasifier B and related lignite feed and ash systems. “The schedule extension provides for time to complete mechanical equipment modifications to the gasifiers’ supporting systems to increase capacity to the levels necessary to complete the remaining start-up activities and achieve sustained operations on both gasifiers,” Southern Co., Mississippi Power’s parent company, said in an August 8 filing with the Securities and Exchange Commission (SEC).
“The remaining schedule also reflects the time expected to complete the initial operation and testing of the facility’s syngas clean-up systems, as well as the integration of all systems necessary for both combustion turbines to simultaneously generate electricity with syngas,” it said.
However, it warned that delays beyond the October 31 startup date might be unavoidable. “Significant testing activities, including those for coal feed and gasification systems, as well as the initial operation and testing of the facility’s gas clean-up systems and production of clean syngas, and, ultimately the generation of electricity, remain in process,” it added. Any extension beyond October 31 could cost between $25 million and $35 million per month. Those costs will include startup labor, materials, and fuel, as well as operational resources required to execute startup and commissioning activities.
Southern Co.’s 10-Q filing with the SEC reveals that the company expects to incur estimated losses of $134 million as a result of delays at the Kemper IGCC plant over the past year. Those losses reflect revisions of estimated costs expected to be incurred for construction of the plant in excess of the $2.88 billion cost cap established by the Mississippi Public Service Commission.
Fueled by locally mined lignite, the 582-MW plant will use transport integrated gasification technology. It will also capture its carbon emissions and transport them via pipeline infrastructure for use in enhanced oil recovery.
The project’s original cost estimate outlined in a 2012 certificate of public convenience and necessity order was $2.4 billion, net of $245 million in grants awarded to the project by the Energy Department under the Clean Coal Power Initiative Round 2. That figure didn’t include the cost of the lignite mine and equipment and the cost of the carbon dioxide pipeline facilities.
The project was, meanwhile, originally projected to be placed into service in May 2014. Mississippi Power put the combined cycle and other common facilities online by August 2014, but has experienced difficulty placing the gasifiers in operation.
—Sonal Patel, associate editor (@POWERmagazine, @sonalcpatel)