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Mississippi's Affordable Energy Prices

There are many qualities or records a state can tout while trying to attract new business and industry, but few are more important than low electricity rates, particularly when trying to appeal to energy-intensive manufacturing facilities. Fortunately, this is an advantage for economic development officials in Mississippi. Advance Mississippi recently reviewed the average residential and commercial electricity rates (in dollars per megawatt hour) for Mississippi as well as the national average. In this brief Advance Mississippi provides statistical information that shows Mississippi's average rates to be considerably lower than the national average, providing a major benefit to Mississippi's residential and commercial ratepayers. How Mississippi Measures Up Statistics from the Energy Information Administration, a part of the U.S. Department of Energy, show that the national average cost per megawatt hour (MWh) for calendar year 2010 was $115.80 for residential customers and $102.60/MWh for commercial customers. The average monthly cost in Mississippi was $99.50/MWh for residential customers and $93.20/MWh for commercial customers. These figures show Mississippi's average for residential ratepayers is 14% below the national average while Mississippi's average commercial bill is 9% below. Why are rates in Mississippi lower than the national average? When look at electricity rates there are many factors to consider. One is the types of power generation available in the state, or generation mix. A majority of the power in Mississippi is generated using nuclear energy, natural gas, and coal. Electricity generated by nuclear energy is typically the most affordable power. Grand Gulf Nuclear Power Station, located in Port Gibson, will soon be the highest producing nuclear reactor in the country, increasing Mississippi's supply of affordable energy. The discovery of new deposits of natural gas and the potential of shale gas has stabilized and lowered the price of natural gas. Many analysts now predict that natural gas prices will remain around their current levels for years to come. Coal has always been an affordable fuel source due to the large supply available in the United States. Lignite, a lower grade form of coal found in abundance in Mississippi, has been utilized as a power source in the state at the Red Hills Power Plant in Ackerman and will be the fuel for Mississippi Power Company's state-of-the-art IGCC plant in Kemper County. Another reason for low rates is forward thinking by Mississippi utilities and power regulators. Utilities must make long term plans that ensure the lowest rates possible both now and in the future. Working with regulators at the Mississippi Public Service Commission, they ensure that Mississippi has access the enough affordable, reliable power that is needed to meet current and future electricity demands.

120 North Congress St., Suite 620, Jackson, Mississippi 39201 · Phone: 601.397.6667 · Fax: 601.397.6668 · www.advancemississippi.com

Economic Benefits Lower electricity prices result in lower prices of goods and services. This means food, clothing, and even healthcare cost less. These lower costs result in more available capital which both small and large businesses can use to expand and create more jobs. These lower prices are particularly beneficial in current economic conditions when the costs of other necessities have increased. In addition to helping existing companies create jobs, low electricity prices are used by economic development officials to attract new businesses to an area. With commercial electric costs 9 percent below the national average, Mississippi has an advantage over other states in attracting new, energyintensive industries. Conclusion Mississippi is fortunate to have utilities that work hard to keep rates lower for their customers. These lower rates provide Mississippi with important advantages in attracting new businesses, improving the economy, and reducing the cost of living. Lower electricity rates give Mississippi a bright economic outlook and a reason to be optimistic about the state's future. Additional Resources U.S. Energy Information Administration http://www.eia.gov/ Entergy Mississippi http://www.entergy-mississippi.com/ Mississippi Power Company http://www.mississippipower.com/ Tennessee Valley Authority http://www.tva.gov/ Electric Power Associations of Mississippi http://www.epaofms.com/

Advance Mississippi's mission is to advocate for sensible energy policy that will fuel economic opportunity in Mississippi, and educate policy makers, business and community leaders, and the general public about superior energy policies that will foster economic growth. For more information, visit www.advancemississippi.com. Entergy Mississippi, TVA, and Mississippi Power Company are all members of Advance Mississippi.

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