Georgia Power Purchase Keeps Mississippi Coal Plant Online Past Planned Closure - Data Centers Again

Last October, Georgia Power approached regulators with what it said was a crisis. Unless they did something soon, they discovered, the growing demand for electricity would outpace production sometime in the winter of 2025. Georgia’s Governor Brian Kemp and other state leaders had been courting data centers and new manufacturing plants for some time, and it was all catching up to the aging power grid. The Georgia Public Service Commission, the elected body tasked with regulating the utility company, had approved Georgia Power’s long-term grid plan, which the company makes every three years, in 2022. Since then, the company said, its projections for the growth of electricity demand through 2030 had increased by a factor of 17.

Georgia Power proposed a mix of resources to meet this rising demand, including buying power from neighboring utilities, adding solar and battery storage, and building three new natural gas turbines that could generate 1,400 megawatts of electricity, enough to power more than half a million homes, per year. Experts, including some on the service commission’s own staff, have questioned those projections and the power company’s method of making its forecast. They testified that the growth in energy demand would take longer to materialize than the company projected, giving the utility more time to address the problem. The plan for gas-powered turbines also drew sharp criticism from experts and members of the public alike, who said the utility should rely on carbon-free solutions.

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The deal came with an added concern: In order to provide electricity to Georgia, a Mississippi Power coal plant that had been slated for closure will need to keep running, reversing plans approved by Mississippi regulators and saddling residents of that state with the cost risks and pollution of coal to meet energy needs in Georgia. Georgia Power officials even cited that impending closure as a reason they entered into the deal last year. Asked by Georgia Power’s own lawyers why it was necessary to sign an agreement with a sister company, the utility’s director of resource planning Jeffrey Grubb replied, “Because those units would have been either retired or sold off-system and we needed certainty that they would be there to serve our customers.” The Victor J. Daniel Electric Generating Plant, or Plant Daniel for short, sits in a rural area of Jackson County in the southeastern corner of Mississippi. It has operated two coal units since the 1970s; in 2001, two new gas combined cycle turbines were built on the same site. Together, the four units comprise the state’s largest single power station.

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In January 2024, when Georgia Power finally faced public questioning about the deal, Tim Echols, one of Georgia’s public service commissioners, explicitly acknowledged this aspect of the deal: “I guess the benefit to it being outside is the pollution’s not in Georgia, right?” he said. “It’s in Mississippi. It’s in other places.” To Mississippians, that comment was telling. It was cited in the Sierra Club petition, which asked the commission to weigh in on the purchasing agreement and require Mississippi Power to show how its plans to “continue operating several of its aging fossil plants and sell the power to Georgia Power” would impact Mississippi ratepayers. “Continuing to operate these units past the previously established retirement dates poses potential economic risks to the [Mississippi Power] ratepayer, including potentially significant capital investments to comply with impending environmental regulations, maintenance costs, and risks associated with the storage of coal ash residuals at Plant Daniel,” Robert Wiygul, an attorney for the Sierra Club, wrote.

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https://grist.org/georgia-psc/why-mississippi-coal-is-powering-georgia-data-centers/