No Decision Yet on Mississippi Power Rate Increase, But an
Increase is Certain Perhaps it has to do with the day, Friday the 13th, but Mississippi Power's 9.2 percent rate increase will have to wait some more as the full Public Service Commission has yet to make it happen. Last week, Southern District Public Service Commissioner Leonard Bentz
told GCN that a decision on the rate Bentz told GCN that he knows that any rate increase at this time will be tough on Mississippi Power's customers, but he is hamstrung over the PSC's inability to actually determine the needs of the utility over its fuel costs. The Public Service Commission is actually two agencies that operate from two separate budgets. The PSC's three commissioners do not control the PSC's staff or executive director, and Bentz says neither entity has the tools to audit the performances of utilities that they supposedly regulate. More on the two PSC's in a moment. But regarding the rate increase, Bentz tells GCN that a full vote is still pending. "The vote on my petition to approve the increase could come by the other commissioners next week, or even later," Bentz said. He says the vote is likely to be in favor of Mississippi Power eventually. The timing couldn't be worse. Mississippi Power entered into a two year contract to acquire coal and natural gas last summer when prices for both were high. Since then, the world economy has tanked, sharply reducing the price of fuel. But the company is obligated by its contracts and regulations that allow power companies to recover fuel costs in rate increases from their customers. Even so, some think any rate increase is not warranted and the power company should cut back on its profits to ease the burden of the higher electric bills south Mississippians will have to pay when the rate increase is approved. That has been part of the numerous meetings among the PSC has held since Mississippi Power made its request to increase rates late this past year. Normally, rate increases are virtually a slam dunk for utilities because the state's Public Service Commission doesn't have the tools or the funding to properly audit the information provided by the utilities they regulate. Back in the early 90's shortly after several PSC commissioners were found guilty of corruption, the state legislature reorganized the PSC dividing it into what essentially is two agencies with the same name, neither funded with enough money or people to actually audit the information provided to them from the utilities. A bill in this year's legislature, HB1087, seeks to fix some of the problems. It initially failed in the house earlier this week, but was revived this morning on a recall vote and passed. Now it goes on to the state senate. The bill's outcome is still uncertain, but Bentz says it is badly needed. "We need help to get this bill approved," Bentz told GCN. In any case, the Mississippi Power rate increase seems to be a certainty, but just not today, or maybe even next week. But when the increase is approved, it will be applied quickly. Bentz says it could be in effect as soon as the next billing cycle after its approval. The fact that the Mississippi Public Service Commission does not have the tools to do its work is alarming many at a time when power and fuel costs in general are so uncertain. More Information: Decision on Mississippi Power's Rate Increase Next Week - GCN 2/5/09 Mississippi Power's Rate Increase Unwarranted - GCN Analysis 1/1/09
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increase would come this week. Bentz called GCN late today to say that he
has petitioned the other two commissioners to approve the rate increase,
but they have not yet accepted his petition. That means it's a no-go for
now.