Southern (NYSE:SO) continues to see the total price for the Kemper County coal gasification power plant inch higher in Mississippi while major milestones are being met on new nuclear generation in Georgia.
Those points, along with unusually cool, wet weather, are some of the highlights from the Southern Oct. 30 earnings report.
Southern reported 3Q13 earnings of $852m, or 97 cents per share, compared with earnings of $976m, or $1.11 per share, in 3Q12.
Results would have been better if the weather in the Southeast had not been so wet and cool during the quarter, officials said.
“During the past quarter, our service territory experienced its highest level of rainfall in nearly 100 years,” said Southern CEO Thomas A. Fanning.
The increased rainfall across the Southern territory might be one reason that Southern saw its share of hydroelectric and other non-fossil, non-nuclear electric generation double from 2% during the first nine months of 2012 to 4% during the first nine months of 2013.
The share of gas-and-oil generation in the Southern fleet has decreased from 45% in the first nine months of 2012 to 42% during the first three quarters of 2013. Coal power output has increased slightly from 37% to 38% while nuclear energy stayed flat at 16%.
Kemper IGCC timetable, cost adjusted
Earnings for the three months and nine months ended Sept. 30, 2013, include after-tax charges of $93m (11 cents per share) and $704m (81 cents per share), respectively, related to increased cost estimates for the construction of Mississippi Power‘s Kemper County project.
In an Oct. 28 8-K filing with the Securities & Exchange Commission (SEC), Southern said the cost for the Kemper IGCC is now roughly $4.02bn. That’s net of $245m in federal clean coal power grants. The $4.02bn figure is also net of the cost of the lignite mine and equipment, the cost of the carbon dioxide pipeline facilities, allowance for funds used during construction related to the Kemper IGCC, and certain general exceptions, the company said.
Southern and Mississippi Power previously said they did not expect to meet the May 2014 date for completion of the IGCC. Southern now expects commercial operation of the 582-MW coal gasification plant in the fourth quarter of 2014.
Southern is taking a $150m charge to earnings as a result. It’s important to note that Mississippi Power customers won’t be responsible for costs above the $2.88bn cost cap, Fanning said.
There is progress being made at the Vogtle 3 and 4 nuclear units being developed by Georgia Power and its partners. Final assembly of the Unit 3 nuclear island auxiliary building (CA-20) is expected in December. The Unit 4 nuclear island basemat pour is expected in November, Fanning said.
Southern and the federal government have extended the deadline for reaching an agreement on a Department of Energy (DOE) nuclear loan guarantee for the new Vogtle units until the end of this year.
Southern is in the process of seeking certain IRS production tax credits for the Vogtle units.
Southern is expected to spend $17.9bn in capital expenditures between 2013 and 2015.