PSC meetings not impressive

Opinion

March 16, 2013

PSC meetings not impressive

By Wyatt Emmerich, Syndicated columnist The Picayune Item Picayune Item Sat Mar 16, 2013, 07:00 AM CDT

PICAYUNE — I attended my first Public Service Commission (PSC) hearing last week. I was not impressed.

Because power companies have monopolies, the PSC is there to protect the consumer. But that’s not what I witnessed. Instead, PSC commissioner Leonard Bentz seemed irritated at some of the citizens who showed up to protest the new rate hikes precipitated by the new $3.7 billion Kemper lignite plant.

Bentz started the meeting by complaining about “misinformation” published by various reporters and columnists. I guess that includes me.

During a break, I approached Bentz, gave him my card and told him I would be happy to meet with him to straighten out any misinformation. I was not warmly received.

I can certainly understand the pressure Bentz feels. It would make me testy as well. But what about the 300,000 or so utility customers who will soon see a 25 percent increase in their utility bills?

Bentz takes issue with Sierra Club reports indicating rates will eventually go up 60 percent or more. He pointed out that the rate increase is 25 percent, not 60 percent. Regarding this first rate increase, he is correct. But who said this will be the last? It could well be the first of many.

The question is, why are rates going up at all? As a businessman, I buy new equipment to lower my cost of production, not raise it. I don’t recall any brownouts in Southeast Mississippi. So why was this plant built in the first place?

The tab for the new plant is $3.7 billion and rising rapidly. The total number of customers served by the plant is about 300,000 - about a fourth of the state. That comes to $12,000 per utility customer on average. The interest and principal to pay that off over 20 years could easily top $1,000 per year per customer. That’s why tensions are running high.

To be sure, the PSC limited the public’s exposure to $2.4 billion and held firm on that. So the Southern Company went straight to the Legislature and got another billion dollars in bonds, which the customers have to pay back through their utility bills. Those two numbers add up to $3.4 billion.

For the record: Bentz opposed the extra billion that the Legislature approved, and he has no blame for that. Rumor has it that just about every lobbying firm in Jackson was in on the action.

The Southern Company will be looking to its Mississippi customers to pay for the cost of the plant, sooner or later.

There is something very wrong when a company making $3.75 billion in operating profit can force utility customers in the poorest state to pay for an experimental $3.7 billion power plant that isn’t even needed.

Typically, efficiencies are gleaned from decades of tweaking complex industrial processes. I predict this experimental plant will be an operating disaster.

And in the off chance lignite gasification miraculously works the first time out of the gate, the Southern Company owns 90 percent of the patent rights — not the Mississippians who financed it.

Former gov. Haley Barbour lobbied hard for the project and appointed Bentz to the PSC board. Barbour’s lobbying firm has received $2.6 million from the Southern Company, according to the Sierra Club.

Perhaps when natural gas was $9 in 2008, there was a sliver of logic. But that was a 40-year high. Since then, natural gas prices have dropped below $4. With the advent of fracking, low prices are forecast indefinitely.

For Kemper to break even with the natural gas alternative, gas prices would have to immediately go up to their all-time highs and stay there for the next 40 years. That isn’t going to happen.

As one industry observer put it: “We built a $4 billion experimental plant when all we needed was a few small natural gas turbines to handle peak loads. We could have achieved that for a fraction of the cost.”

A full-scale natural gas plant would have cost one-sixth as much and produced 50 percent more electricity.

Any private company would have pulled the plug long ago. But that’s not how it works in the world of a regulated monopoly. Instead, the Southern Company will spend millions to lobby influential government officials and make Mississippi’s families swallow a huge increase in their monthly power bills. This is the very thing the PSC was designed to prevent. Instead, the commission is enabling it.

Along with Bentz, who comes from the coast, PSC Commissioner Lynn Posey has supported Kemper. Posey represents the Central District where the plant is being built, but his voters won’t have to pay for it. So Posey may see jobs for his district at no cost.

Brandon Presley, the northern commissioner, has opposed Kemper with no small amount of outrage. But he is outnumbered. He has written several guest editorials along the lines of this one, but to no avail.

I have written about this misguided project for years now. Never once has anyone from Southern or the PSC disputed my facts or attempted to show me the light. I hope to meet with Southern Company officials in the near future and visit the plant. Nothing would make me happier than to discover I am completely wrong, for I feel sad that this economic albatross is going to be around the neck of my beloved state for the next 40 years. This is 72 times the size of the beef plant.

I recall taking a government course in college about how regulatory agencies end up getting cooped and manipulated by the very industries they are supposed to regulate. As far as I can tell, this is precisely what has happened here. Monopolies are simply bad for society. Don’t try to regulate them. Break them up and allow consumers choice. Given a choice of electricity providers, I seriously doubt many Mississippi utility customers would have chosen the one with the highest price — even if it is bleeding edge technology.

Text Only

Opinion

Not your mother’s Ladies’ Home Journal
By Rheta Grimsely Johnson/Syndicated columnist

I haven’t seen the Ladies’ Home Journal in about a million years, except maybe in the dentist’s office when I was trying to avoid a television permanently set on Fox News.
Somebody’s grandchild was selling magazines for a school project, and Ladies’ Home Journal was the only one on the list I recognized. Now it comes to the house.
Let’s just say: It’s not my mother’s Ladies’ Home Journal. This month, right behind a feature called “A Country of People Who Never Stop Eating” is one called “Nice Girls Do Get Tattoos.”

March 29, 2013
Health care market needs oversight
By Gene Lyons/Syndicated columnist

Sometimes the best journalism explains what’s right under our noses. In Steven Brill’s exhaustive Time magazine cover article, “Bitter Pill: Why Medical Bills Are Killing Us,” it’s the staggeringly expensive, grotesquely inefficient and inhumane way Americans pay for medical care.

March 29, 2013
VA’s appalling failures not recent
By Sid Salter/Syndicated columnist

While recent national press attention to ongoing problems at Mississippi’s G.V. (Sonny) Montgomery Veterans Administration Medical Center in Jackson is welcome and needed, the failures of the overall VA service apparatus in Mississippi are not recent problems.
In short, former U.S. Rep. Sonny Montgomery — Mississippi’s “Mr. Veteran” and author of the modern G.I. Bill that bears his name — must be spinning in his grave. There have been significant failures and poor service to veterans documented by state and local media since 2008.

March 27, 2013
Dolley Madison politically savvy
By Cokie and Steven V. Roberts/Syndicated columnists

When Dolley Payne Madison became first lady in 1809, she instituted Wednesday evening gatherings at the White House where political rivals could meet and talk. They were called “squeezes” because so many people showed up and crowded the room. As Cokie wrote in her book “Ladies of Liberty": “All were welcome as long as they were appropriately dressed. And all went — skipping a Wednesday night might mean missing a vital piece of political information or being left out of a crucial deal.”

March 27, 2013
Mississippi isn’t immune from national college tuition trends
By Sid Salter/Syndicated columnist
Higher education in Mississippi has not been immune from national trends cited in a recent Center on Budget and Policy Priorities report which concludes that over the last five years, the global economic downturn and a “no new taxes” political climate have increasingly shifted the burden of higher education finance to students and parents at a time when enrollment is increasing and the percentage of state support is decreasing.

March 23, 2013
Right to vote not ‘racial entitlement
By Donna Brazile/Syndicated columnist
The Supreme Court heard oral arguments in the case of Shelby County v. Holder — a challenge to the Voting Rights Act of 1965, specifically Section 5, which requires states and localities with a history of voting discrimination against racial and language minorities to get “pre-approved” by the federal government before changing how elections are conducted or voters are registered.

March 23, 2013
1st day of spring brings memories
By Wyatt Emmerich/Southside Sun

The first day of spring! My favorite month, April, is just around the corner. Now we just need one big gullywasher to get rid of the pine pollen.
Normally, spring gives me a strong sense of rebirth and renewal, but this spring I seem surrounded by moments crystallizing the passage of time.
It was a year ago, I walked up the porch to my mother’s home to box up her possessions following her funeral.

March 22, 2013
Soaking up in tiger paw-shaped hot tub
By Rheta Grimsely Johnson/Syndicated columnist

No springtime ritual was better at Auburn than sitting on hard rocks at a nearby state park to let cold water rush over your feet. You wore cut-off blue jeans and Dr. Scholl’s sandals, the unofficial uniform for coeds in the 1970s, and when you left, you felt ready to tackle tests, term papers and blind dates.

March 22, 2013
Medicaid or not, costs will be paid
By Sid Salter/Syndicated columnist

While the battle continues between state Republicans and other fiscal conservatives intent on focusing on the long-terms costs of Medicaid expansion under the Affordable Care Act and Democrats, health care advocates and state hospitals intent on focusing on the short-term benefits, the fact remains that one way or another, the costs of providing health care for the poor, the blind, the aged and the disabled will be paid by the taxpayers one way or another.

March 20, 2013
Multiculturalism is not rational
By Thomas Sowell/Syndicated columnist

Among the many irrational ideas about racial and ethnic groups that have polarized societies over the centuries and around the world, few have been more irrational and counterproductive than the current dogmas of multiculturalism.
Intellectuals who imagine that they are helping racial or ethnic groups that lag behind by redefining their lags out of existence with multicultural rhetoric are in fact leading them into a blind alley.

March 20, 2013
More Opinion Headlines

Opinion

Search Results

PSC meetings not impressive

Site Map

Contact Us