Southern Company continues to press its generation monopoly to the limits but just might have gone beyond the breaking point even in Mississippi. Southern's 582-megawatt, coal gasification Kemper plant, that was budgeted to cost a very large $2.4 billion, now is running a gargantuan $4.2 billion or $7 per watt.
Though the plant is not running and won't until 2014 at the earliest, the captured monopoly ratepayers of Southern in Mississippi have been and are paying for the plant. The latest cost overrun at Southern brings to mind the many lectures by Southern's Chief Executive about his belief in the superiority of the traditional monopoly generation system to electricity generation competition practiced in Pennsylvania and some other states.
In Pennsylvania, the power plant builders own all a plant's profits or losses and earn no revenue from consumers, unless and until they actually produce a kilowatt-hour. If that alignment of incentives sounds better to you, you are right that it is.
And by the way, Southern is building two nuclear plants in Georgia that are behind schedule and over budget. Southern's Georgia captive ratepayers are also paying today for those to-be-built nuclear plants.
It's good to be the monopolist.