Environmentally focused groups are praising a proposal by a corporation they often clash with – the state’s largest utility.
Ameren Missouri has submitted a plan to regulators that would offer 26 energy efficiency rebate programs to customers over a six-year period. The plan would require a $550 million investment from the utility giant that would provide $285 million in rebates to both residential and business ratepayers.
Customers could take advantage of the incentives in a variety of ways such as upgrading their heating and air conditioning systems to more energy efficient units.
Another program would offer a rebate for the installation of smart thermostats, a move that’s being praised by James Owen, the Executive Director of Renew Missouri, a nonprofit group focused on renewable energy and energy efficiency policy.
“This kind of technology provides not only more information to the utility, so they can properly manage their resources, but also lets customers make smarter, more informed choices,” said Owen. “That’s the only way the marketplace can truly work.”
Owen worked at the Missouri Office of Public Counsel under Democratic Governor Jay Nixon’s Administration, where he was a customer advocate watching over state-regulated utilities.
He thinks Ameren’s energy efficiency plan has a chance to be effective because the company has offered to keep it in place for six years, double the time period of any of its previous such proposals.
“Renew Missouri sees this as a chance for Ameren Missouri to really get their technology and programs into good shape in order to maximize their value”, Owen said.
Bill Davis, director of energy efficiency and renewables at Ameren said in a statement that by expanding the program to six years, the company will be able to include a wider range of options.
“(That includes) 15 new programs,” said Davis. “There are savings opportunities for every home and business, including specific savings for limited-income customers and social service agencies.”
Ameren Missouri filed its energy efficiency plan with the state’s regulatory body, the Public Service Commission (PSC), Monday morning. It did so under the Missouri Energy Efficiency Investment Act (MEEIA).
MEEIA was enacted by the state legislature on 2009 with bipartisan support and the backing of consumer and environmental groups. It’s intended to allow utilities to earn a profit on the electricity saved as a result of energy efficiency programs and incentives they offer to their customers.
According to Owen, the rate of profit generally granted by the PSC is roughly 10%. He notes that 10% will be subsidized by ratepayers which means customer utility rates will go up.
But he says the increase will be offset by a decrease in energy consumption because of the efficiency plan. Owen also noted that customers that use the rebates to help pay for upgrades will see larger cost savings over time.
The Sierra Club, one of the country’s most prominent environmental groups, has also endorsed Ameren’s proposal. John Hickey with the Sierra Club of Missouri says the type of program being offered by Ameren delivers environmental as well as economic dividends.
“We are totally behind energy efficiency as a resource because it’s the cheapest form of energy,” said Hickey. “It’s even cheaper than wind and solar (energy). It’s the cleanest because it cleaner than wind and solar. And it creates the most jobs.”
Hickey says energy efficiency measures such as upgrades to air and heating systems are good for jobs because they put local contractors and crews to work.
Owen says energy efficiency programs provide an attractive path for regulated utility companies to become more energy efficient.
“Large utility companies don’t have an incentive to encourage energy efficiency because they would make less money,” said Owen. “So, by doing this, it gives them the ability to produce less energy but still not lose out on making money.”
Both Renew Missouri and the Sierra Club have a dim view of Ameren’s environmental performance overall. Hickey with the Sierra Club thinks the utility’s energy efficiency proposal is a rare bright spot for the company. “Ameren still has a long way to go and remains the utility with the dirtiest electricity generation mix in the state.”
Renew Missouri’s Owen says Ameren has been very slow to embrace cleaner forms of energy generation. “Ameren really, for its size, is a very dirty utility. They rely very heavily on coal. They rely somewhat heavily on nuclear. And we just want to see them get away from that.”
Owen was fired from his position with the Office of Public Counsel in February 2017, shortly after now-former Republican Governor Eric Greitens took office.
He’s highly critical of the Greitens administration’s handling of utilities and hopeful that his replacement, fellow GOP member Mike Parson, will offer a different approach.
“We are…hopeful that the new administration in Jefferson City will be less hostile to energy efficiency and providing flexibility to utility companies to modernize their efforts,” said Owen. “The Office of Public Counsel, in particular, have done nothing but put forward arbitrary and regressive arguments to keep Missouri’s utilities in the dark ages. We think Governor Parson’s past public support for low-income development projects, as well as his pro-business commitments, will lead to more cooperation in Jefferson City.”