Lawsuit: Southern Co. lied to DOE over Kemper CCS plant
BY: ZACH BRIGHT | 11/01/2023 06:49 AM EDT
A former employee of the utility said she was ordered to prepare documents with false information on the now-canceled Kemper carbon capture project.
ENERGYWIRE | Southern Co. allegedly defrauded the Department of Energy and state regulators of hundreds of millions of dollars tied to a first-of-a-kind “clean coal” power plant that was never completed, according to a lawsuit unsealed Monday from a former construction manager at the utility.
Kelli Williams, the former worker, said Southern Co. and its subsidiary Mississippi Power Co. repeatedly lied to DOE officials about cost overruns and delays that plagued the $7.5 billion Kemper County Energy Facility, which was slated to capture emissions from gasified coal.
Instead, the companies urged the federal government to continue providing subsidies, which reached about $382 million in funding over the course of the plant’s construction.
If the utility had been honest about the plant’s progress and viability, “DOE would have known the Kemper Project was not viable” and pulled funding, said an amended complaint from Williams filed Monday in the U.S. District Court for the Northern District of Georgia. The plant originally was projected to cost approximately $5 billion less than its ultimate price tag.
The lawsuit alleges violation of the False Claims Act, a federal law that allows private citizens to sue on behalf of the government to recover damages and penalties. If Williams wins the case, she could be legally entitled to up to 30 percent of any relief payments and Southern Co. could be forced to pay more than $1 billion — triple the damages.
Southern Co. spokesperson Schuyler Baehman said the company does not have a comment at this time.
According to the lawsuit, Southern Co. and Mississippi Power urged the state’s Public Service Commission to maintain Kemper’s construction certification, despite the project’s difficulties.
State regulators “would have never issued the Certificate or would have rescinded it” if they knew of the project’s persistent delays, the complaint says.
Williams said in the complaint that she was asked repeatedly to prepare budget documents for state regulators showing that that the project was on track when it wasn’t.
For years, the Kemper County power plant was looked to as a successful example of carbon capture technology on power plants. It was supposed to be able to turn lignite coal into lower-carbon gas and burn it to generate power, with the captured greenhouse gases being used in enhanced oil recovery.
But the carbon capture portion of the plant never became operational. After the utility filed a rate plan, the Mississippi Public Service Commission ordered it in 2017 to stop building a gasifier and chemical removal unit. The plant then continued to run on natural gas, but the rest of the facility has been demolished.
Climate and environmental groups have pointed to the plant’s failures as evidence that carbon capture on coal-fired power plants isn’t feasible. Supporters of the technology say that valuable lessons were learned from Kemper.
Southern Co. faced whistleblower allegations in 2014 to the Securities and Exchange Commission that the company defrauded investors by misrepresenting the plant’s construction schedule. No enforcement actions came of the allegations.
The Associated Press contributed.