Public Service Commission approves Mississippi Power’s option to convert a Plant Daniel coal unit to natural gas

The Public Service Commission approved a staff-recommended joint stipulation allowing Mississippi Power to reserve which of the Plant Daniel coal units it may convert to natural gas operations.

Miss Meyer, the staff presenter, told commissioners that Mississippi Power filed on Feb. 12 for a certificate of public convenience and necessity to convert Plant Daniel Unit 2 from coal to natural gas and later filed a supplemental petition asking the company be allowed to choose either Unit 1 or Unit 2 at a later date. She said the company estimated incremental project costs at $69,000,000 and that the conversion would result in an estimated bill impact of about $1 per month for a 1,000 kilowatt-hour residential customer.

“Mississippi Power proposes its decision as to which coal unit to convert be reserved for future determinations so that the economic benefits promised by such a conversion can be optimized,” Miss Meyer said in presenting the joint stipulation.

Commissioner Stamps said the state should set fuel-diversification goals and make that policy decision internally, rather than allowing outside actors to dictate the mix. Commissioner Carr asked whether conversion would extend the unit retirement schedule; staff indicated the planning data provided still showed a 2046 retirement in the scenarios reviewed but that the company could address that more precisely when it elects the unit.

Ben, a Mississippi Power representative, told the commission the company had secured firm gas transportation and that converting one unit would preserve overall capacity while addressing environmental regulatory risks. He said the company expects engineering and procurement in 2028 and gas operations possible in June 2029.

The commission approved the item by voice vote. As a condition, commissioners and staff noted Mississippi Power must submit a compliance filing when it declares which unit will be converted and must provide updated cost, schedule and accounting impacts at that time; staff also reserved its right to pursue additional discovery once the election is made.

Why it matters: The approval preserves the company’s flexibility to choose which unit to convert while requiring further detail before construction begins. Commissioners emphasized state-level planning for generation mix and cautioned about future natural-gas price risk and the potential loss of fuel diversity.

Next steps: Mississippi Power will file a compliance notice specifying which unit it elects to convert and will update the commission on cost and schedule details; staff said it would retain discovery rights to review those updates.