Members of the Mississippi House passed a pair of rate mitigation and securitization bills that would allow the Mississippi Public Service Commission (MPSC) to approve a multiyear rate plan for Mississippi Power’s $2.88 billion Kemper integrated gasification combined cycle (IGCC) plant that is under construction in Kemper County.

One bill would allow the utility to sell up to $1 billion of "securitized" bonds to cover costs of the plant beyond the MPSC-set hard cap of $2.8 billion that the utility can recover through base rates. The bonds will be repaid over a long period of time through a charge on customers’ bills.

The other bill greenlights a settlement reached by the MPSC and the Southern Co. subsidiary to seek higher customer rates for rising costs associated with the 582-MW lignite-fired power plant. The utility last month filed for a $172 million rate hike to cover certain financing costs related to Kemper.

The bills now head to the state Senate, where similar measures are pending. Mississippi Power said it was "very pleased" with the House’s decision, saying the action would take it one step closer to saving "Mississippi Power customers $1 billion or more."

Sources: POWERnews, Mississippi Power