New York Times pens scathing article against Mississippi Power K - WDAM-TV 7-News, Weather, Sports-Hattiesburg, MS

New York Times pens scathing article against Mississippi Power Kemper Plant

The New York Times penned a scathing article against the Mississippi Power Kemper Plant. Source: WLOX The New York Times penned a scathing article against the Mississippi Power Kemper Plant. Source: WLOX
KEMPER COUNTY, MS. (WDAM) -

The New York Times published a scathing article Tuesday against The Mississippi Power Kemper Plant.

The Kemper Plant, located in De Kalb, is an electrical generating station currently under construction with the goal of producing electricity from coal.

The plant’s owner, Southern Company, was cited in the article for everything from fudging completion timelines, to outright misleading the public on the success of the project.

"They would go to the Public Service Commission in Jackson, and tell lies about how much it was costing and how soon it would be up and running and that they would meet these schedules," said Hattiesburg's Thomas Blanton, who won a lawsuit against Mississippi power in 2015 that refunded customers millions.

The key piece of evidence in The New York Times article against the plant’s mismanagement was a whistleblower by the name of Brett Wingo.

Wingo was an engineer who worked on the inside, and recorded countless errors made by management. The New York Times obtained thousands of pages of public records and over 200 hours of secretly, but legally recorded conversations from Wingo.

"Mississippi Power and The Southern Company falsely stated scheduling and were way overly optimistic, and they had managers on the scene and engineers telling them 'We can't finish it on time,'" Blanton said. "The reason they were doing all of this was to 'earn' tax credits and to qualify for hundreds of millions of dollars in grants from the Department of Energy, and as it's coming to light through this article that was publish (Tuesday), it was mostly lies. And they knew it. They knew they were lying." 

Wingo brought to light many problems the plant faced during construction. Some of the problems highlighted were starting the plant’s construction when plans were less than 15 percent completed.

"They've admitted now, and we've known since 2012, they only has 15 percent of the engineers' drawings done when they came in, put their hand on the Bible, raised their hand and swore that it's only going to cost $1.8 billion," Blanton said. "They had no idea how much it was going to cost or how long it was going to take to build it because they didn't even have a drawing done."

Other issues mentioned were increasing ratepayers rates before projects were completed, and the company’s decision to conceal cost overruns of about $366 million.

"The knew that this thing was costing way more than they were telling the Public Service Commission," Blanton said. "I filed my intervention on the rates in 2011. Five years ago. And I knew in 2010 that this was happening. When utility bills go up substantially, like 20 percent, there's human impacts, so I was really happy to be able to win the refunds. It was more than $357 million that came back to the ratepayers in November and December."

Blanton said he has friends who had their refunds credited to their bills in November 2015 and just received their first bills in June. He also said he's heard from strangers explaining how essential the refund money was to their livelihood. One letter from a "poor, displaced, fifth-generation farmer," said the money allowed him "for the first time ever" to buy "new shoes and new clothes" for his six children for Christmas.

Blanton said the company and the Public Service Commission were under intense political pressure from as high up as the White House to produce a plant with working technology.

"Undue political pressure is placed on them (from) the governor," he said. "They're getting letters from the president of the United States, the Department of Energy and all of these people (are pressing, pressing, pressing. 'We've got to have it. We have to have this clean coal technology' because the Obama administration was building their entire energy policy on the back of this technology working."

The most concerning problem outlined was the poor quality of work in the plant.

RELATED: Southern Company responds to NYT's report on Kemper project

Wingo also claimed that Ed Day, Mississippi Power’s former chief executive, heavily controlled the public’s perception of the plant’s success.

In an email obtained through public records requests by The Times, Day is quoted saying, “’again’ no numbers, schedules or information in general should be communicated to external parties until I review it/them first.”

According to the New York Times article, Wingo, along with many other engineers working for the plant, said the final straw was when the company promised a false construction completion date.

After Wingo brought this to the attention of the chief executive, rather than correcting the record on the false date, the company chose to damage control instead.

The choice to damage control put more pressure on the engineers, because management asked them to create an optimistic timetable for completion so that investors and lawmakers would not be spooked.

Aside from poor management decisions and false promises, Wingo told The Times he was concerned with the poor quality of work that was being done at the plant.

Leaking gaskets, cracked ductwork, missing inspection records and defective pipes all topped Wingo’s list of faulty construction at the plant.

Wingo then told The Times that he presented his allegations to management, but was then told by company officials to stop sending emails because they could become public in litigation.

According to the article, Wingo was even offered $975,000 to keep quiet.

"The scope of the corruption at Kemper is billions and billions," Blanton said. "When it all shakes out, only the Madoff scam will be a bigger scam. Enron wasn't this big. WorldCom wasn't this big. This goes to the top. All the way to the White House. What you have is an industry respond to huge chunks of money, like red meat in front of a bulldog for a corporation. tax credits in the hundreds of millions. Grants in the hundreds of millions that were triggered by being able to meet certain schedules, mile posts. So Southern Company put up miles posts that were not real in order to satisfy goalposts that the government was putting up. They lied about it."

The article goes on to claim that Wingo was sued by Southern Company and was later fired.

Today, the plant is still not completed.  Taxpayers and investors are expected to pay billions of dollars in cost overruns, according to the article.

Mississippi Power released a statement regarding the article Tuesday afternoon. You can read that statement here.

To read the New York Times investigation in full, click here. 

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