There are differing opinions among two Republican state Senators about how much rates could increase under a proposal that would change rate adjustment methods for public utility companies. The Missouri Senate could soon consider Lamar Senator Ed Emery says his bill would make it feasible for public utilities to modernize their aging infrastructure.
Emery tells Missourinet times have changed from the previous era of increasing electric demand through use of things like appliances, computers and phones to an era of consuming those technologies but in a more efficient way.
“What that has done is, it has disrupted the regulatory structure,” says Emery.
He says utilities need to do more than maintain the current electric grid.
“It (the bill) is designed to set in place a separate path for an element of investment, roughly around $200 million a year, and have an additional method of recovering that other than through the conventional rate case,” says Emery.
He says the potential increase per residential customer would be about 1.2% per year.
Sen. Doug Libla (R-Poplar Bluff) tells Missourinet the measure would allow public utilities to boost their profit margins on the backs of consumers.
“Senate bill 190 has the potential to raise your electric bill another 38% over and above the rate cases they may file during that time with the PSC (Public Service Commission),” says Libla.
He says the measure would also diminish oversight of the PSC. Over the last five years, Libla says Ameren’s stock price has increased more than 64% and KCP&L’s has jumped 48%.
“Ameren and KCP & L, respectively, have received the J.D. Power Award for being number 1 and number 2 in the Midwest for customer reliability. So I don’t see the issue. To me, it’s just greediness,” says Libla.
Emery disagrees with that assessment.
“Saying that because a company is financially sound has absolutely nothing to do with whether or not they need a regulatory reform model in order to make certain investments because that is all decided by the PSC,” says Emery. “If you pull the numbers out of Wall Street or you pull the numbers somewhere else and if you don’t know what is behind those numbers, it’s easy to say ‘Look they don’t need any extra money. Look how well they’re doing.’ They’re only doing that well because some Public Service Commission has acknowledged that they have to do that well in order for them to continue to operate effectively in this industry.”
The bill is a product of a Senate interim committee’s work last year.
The Missouri legislature is on spring break this week. The session reconvenes on March 27.