The Federal Department of Energy has pledged over $200 million to pay for construction of an unpopular coal-fired power plant in Mississippi. Southern Company, the plant's owner, is a major client of Mississippi governor Haley Barbour's lobbying firm.
But local activists, including both environmentalists and labor, are gearing up to stop the plant, called the "Kemper IGCC."
Barbour will probably run against Obama in 3 years. Why pour $200 million in Federal Department of Energy money into Barbour's lobbying clients' pockets for an unpopular, expensive, polluting coal fired power plant?
The plant will cause doubling of utility rates in a state where several existing power plants seldom even operate. It will produce excessive air pollution.
KRB, the former construction arm of Halliburton, who is implicated in several electrocutions of American troops in Iraq due to shoddy construction, will build the plant, probably with workers imported from around the world, so there will not be many construction jobs for local workers.
Barbour helped the plant obtain waivers from over $1 billion in property taxes, so the underfunded Mississippi government will not obtain much new tax revenue.
The Kemper IGCC is a remnent of a Bush-era program to enrich the coal burning utilities. This project was originally a gift to former Florida Governor Jeb Bush, but not even Florida could swallow this plant.
"IGCC" stands for Integrated Gasification Combined Cycle, which is a process that turns coal into a gas, from which it is easier to remove air pollution, including Carbon Dioxide, an important greenhouse gas. But Southern Company's subsidiary, Mississippi Power, pledges only to remove the minimum amount of carbon dioxide necessary to obtain lucrative federal tax benefits.
Mississippi is overbuilt with existing power plants, left over from when Enron's energy swindles distorted the power plant market. Mississippi Power could easily supply its customers by purchasing power from these underutilized plants.
However, utilities generally make profits as a percentage of their expenditures, meaning if you spend money, for instance $2.8 billion to build the Kemper IGCC, you can make even more money. The problem is that $2.8 billion will be paid by increasing rates on only about 180,000 ratepayers.
But Mississippi has elected Public Service Commissioners whom regulate utilities, and angry ratepayers, with Sierra Club support,will be lobbying the PSC to reject the Kemper IGCC.
Construction unions, angered by KBR's pledge to build the plant non-union, are also mounting opposition.
But one unanswered question is why the Obama Energy Department is pouring money into a project that will only help Obama's likely opponent in the 2012 presidential election?