Ameren Missouri gets the approval to increase electric rates, but one southeast Missouri company will pay a lower rate.
The Missouri Public Service Commission has authorized a rate increase of nearly $121.5 million, which is approximately $142 million less than what Ameren requested in July of 2014. Noranda Aluminum is Ameren’s biggest customer, but company officials said higher rates would force the company to shut down. Noranda Aluminum operates a smelter in New Madrid and purchases more than 10 percent of all Ameren’s electricity.
Public Service Commission Chairmen Robert Kenney said residential customers will see an estimated rate increase of a little over 5 dollars a month and explains why Noranda will receive a lower rate.
“If Noranda left Ameren’s system all together, all of what Noranda is currently paying would then be shifted to other customers and that shift would be greater than the decrease we’ve allowed,” said Kenney. “It’s in the public interest and better for the remaining rate payers for Noranda to continue taking service from Ameren than if they shut down and left.”
Kenney said Noranda would be required to meet certain requirements in order to receive a discounted rate.
“There are employment levels that have to be maintained at the smelter, there are restrictions on their ability to pay special dividends to their shareholders, and there was a requirement that a certain level of capital expenditure be made at the plant itself,” said Kenney.
Ameren claims it needed to raise rates due to continued investment in the company’s generation and energy delivery systems, large investments in environmental controls at the company’s Labadie Energy Center, and a new reactor vessel head at the Ameren Missouri Callaway Energy Center. It also cited escalating net energy costs, the recovery of solar power investments, and customer rebates as other driving factors to increase rates.
The rate increase is Ameren’s 6th rate increase since 2007.