Clean-Coal' Plant Suffers New Setback

By Russell Gold Features Dow Jones Newswires

Southern Co.'s dream of a fully functional "clean coal" power plant is facing another setback.

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The company said Monday that it would need to redesign and replace a critical component in its Kemper County, Miss., power plant in order for the plant to achieve "long-term sustained operations." The related engineering and construction could take 18 to 24 months, it said.

Southern is trying to build the first power plant of its kind, one able to burn coal and capture about 65% of the carbon-dioxide emissions. But the project has faced repeated delays and cost overruns, and since last year, as the facility began to test the equipment, it has experienced leaks and other problems that have pushed back when the facility would be fully operational.

The company's Mississippi Power unit, which is building the facility, said it has spent $5.9 billion on the power plant so far, and $7.5 billion on the plant, coal mines and pipelines to carry the captured carbon dioxide to oil companies, which would pump it underground to extract more crude oil from wells. In 2010, the facility was forecast to cost $3 billion to build.

Southern, based in Atlanta, didn't provide any estimate of how much the new changes would cost.

The facility is designed to burn either natural gas or a "syngas" -- a synthetic gas made from coal. The natural gas side has been operational for a few years, but Southern has had repeated problems with the syngas side.

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A spokesman for the company said the facility was able to operate, but couldn't specify how long the company has been able to operate the equipment continuously before shutting down.

It has been plagued with several leaks from its equipment and unexpected ash buildup. The leaks are occurring in equipment that handles superheated gas, which can exceed 1500 degrees Fahrenheit.

The company said in a filing that the leaks would require the "redesign and eventual replacement of the syngas cooler super-heaters sooner than originally expected."

Earlier this year, Southern told investors in a filing that due to higher-than-expected operating costs, it wouldn't be economical to run the plant on gasified coal unless the cost of natural gas exceeded $5 per million British thermal units. The federal government doesn't expect the cost of gas to reach that level until 2030.

Write to Russell Gold at russell.gold@wsj.com

(END) Dow Jones Newswires

June 05, 2017 20:22 ET (00:22 GMT)