By Rudi Keller
The bill that originated in the state Senate drew bipartisan support and opposition on the 96-44 vote, with 20 Democrats joining 76 Republicans to support it and 23 Republicans lining up with 21 Democrats to oppose it. Three Democratic members voted “present.”
(Area representatives voting yes were Lane Roberts, R-Joplin, Bob Bromley, R-Carl Junction and Cathy Jo Loy, R-Carthage. Casting no votes were Ben Baker, R-Neosho and Ann Kelley, R-Lamar. Rep. Dirk Deaton, R-Noel, was absent.)
With the vote, the bill became the third measure to clear both chambers this session.
While the bill makes a variety of changes to utility law, the most controversial piece would give the Missouri Public Service Commission authority to allow customers to be charged for building new electric generating plants.
Known as a charge for Construction Work in Progress, or CWIP, it has been banned since 1976, when consumers were worried about the cost of nuclear power.
For backers of the bill, the question to be answered is whether Missouri will become the home to new electric generation plants. For opponents, the question is whether it will force power rates up faster than they would increase otherwise.
If Missouri utilities aren’t given the CWIP allowance, they will be forced to buy power in the interstate competitive market when demand peaks, state Rep. Josh Hurlbert, the bill’s handler, said during debate.
“If you truly care about the utility bills of your constituents, voting for this bill actually helps them, because it protects them from those massive prices at the other market,” Hurlbert said.
Opponents of the measure have argued it will add as much as $1,100 a year to residential utility bills. Arguments that the power will be cheaper with the bill than without it are hard to accept, said state Rep. Ray Reed, a Democrat from St. Louis County.
“Folks don’t care how bad it could have been,” Reed said. “They just see that eggs are $9 and that we voted for utility bills to go higher.”
The CWIP charge would be allowed for power plants that use natural gas to generate electricity. In another section, it would be allowed for new generating plants, including nuclear, that are part of an approved plan for meeting power demands.
Supporters have said it is unlikely it will be used for nuclear power because the plant would have to be completed by 2035, when the allowance for CWIP charges expires.
Other provisions in the bill would:Allow “future test year” rates. Currently, rates are set after the PSC examines the actual costs incurred to deliver service and determines if each expense was prudent and necessary. In a future test year scenario, the utility would outline what it expects to spend and the costs would be pre-approved by the PSC.
Require electric utilities to submit plans projecting demand for at least 16 years into the future and plans for meeting those demands. This is the section that allows CWIP for any form of generation approved in the resource plan.
Increase the assessment on utility revenue to fund the PSC and, for the first time, add an assessment to support the Office of Public Counsel, which represents consumer interests before the commission.
Change the shut-off rule for hot and cold weather. Instead of using 24-hour forecasts, the rule would use 72-hour forecasts, prohibiting shutoffs for non-payment in summer if the temperature is expected to exceed 95 and winter if it is forecast to go below 32 within that period.
Passage of the CWIP repeal is the culmination of decades of work by utility companies. The last major effort came in 2009, as Ameren was seeking a license to build a new reactor at the Callaway nuclear plant.
Some of the Republican opponents to the measure objected to the heavy lobbying pressure for the bill. State Rep. Don Mayhew, a Republican from Crocker, said there were “squadrons” of lobbyists “roaming our halls” but he hadn’t heard from any utility customers asking for the bill to be passed.
Instead, he noted, even his voters, who get their power from rural electric cooperatives, are worried about higher prices. Electric cooperatives are not regulated by the PSC.
“I’ve had no less than 25 emails from constituents who are concerned about this, and I’ve reassured them that they’re in coop, this doesn’t affect them,” Mayhew said. “But that doesn’t mean I shouldn’t care about my friends and the Kansas City and the St Louis areas.”
State Rep. Brad Pollitt, a Sedalia Republican, said power from generating plants built in Missouri is more reliable than power from plants built elsewhere. Pollitt sponsored one of the House bills to repeal CWIP.
“It’s important that when we flip the switch, our lights come on,” Pollitt said. “In agriculture, it’s important that when we have hundreds of thousands of dollars worth of grain and grain bins, that those dryers are going to work.”
Passage of the bill drew praise from business interests and scorn from environmentalists.
“Reliable, resilient and affordable energy is essential to retaining and attracting business to the state,” said Kara Corches, president and CEO of the Missouri Chamber of Commerce and Industry. “This legislation will help Missouri meet the growing demand for energy.”
The bill upsets the balanced utility ratemaking process that weighs consumer protection against utility profits, the Sierra Club said in a statement.
“This bill will financially harm families and businesses,” said Jenn DeRose, Missouri senior organizer with the Sierra Club, “because increasing electric bills several years before a power plant begins producing power will drive up the price of everything, from eggs to electronics and beyond.”
With the vote, the bill became the third measure to clear both chambers this session.
While the bill makes a variety of changes to utility law, the most controversial piece would give the Missouri Public Service Commission authority to allow customers to be charged for building new electric generating plants.
Known as a charge for Construction Work in Progress, or CWIP, it has been banned since 1976, when consumers were worried about the cost of nuclear power.
For backers of the bill, the question to be answered is whether Missouri will become the home to new electric generation plants. For opponents, the question is whether it will force power rates up faster than they would increase otherwise.
If Missouri utilities aren’t given the CWIP allowance, they will be forced to buy power in the interstate competitive market when demand peaks, state Rep. Josh Hurlbert, the bill’s handler, said during debate.
“If you truly care about the utility bills of your constituents, voting for this bill actually helps them, because it protects them from those massive prices at the other market,” Hurlbert said.
Opponents of the measure have argued it will add as much as $1,100 a year to residential utility bills. Arguments that the power will be cheaper with the bill than without it are hard to accept, said state Rep. Ray Reed, a Democrat from St. Louis County.
“Folks don’t care how bad it could have been,” Reed said. “They just see that eggs are $9 and that we voted for utility bills to go higher.”
The CWIP charge would be allowed for power plants that use natural gas to generate electricity. In another section, it would be allowed for new generating plants, including nuclear, that are part of an approved plan for meeting power demands.
Supporters have said it is unlikely it will be used for nuclear power because the plant would have to be completed by 2035, when the allowance for CWIP charges expires.
Other provisions in the bill would:Allow “future test year” rates. Currently, rates are set after the PSC examines the actual costs incurred to deliver service and determines if each expense was prudent and necessary. In a future test year scenario, the utility would outline what it expects to spend and the costs would be pre-approved by the PSC.
Require electric utilities to submit plans projecting demand for at least 16 years into the future and plans for meeting those demands. This is the section that allows CWIP for any form of generation approved in the resource plan.
Increase the assessment on utility revenue to fund the PSC and, for the first time, add an assessment to support the Office of Public Counsel, which represents consumer interests before the commission.
Change the shut-off rule for hot and cold weather. Instead of using 24-hour forecasts, the rule would use 72-hour forecasts, prohibiting shutoffs for non-payment in summer if the temperature is expected to exceed 95 and winter if it is forecast to go below 32 within that period.
Passage of the CWIP repeal is the culmination of decades of work by utility companies. The last major effort came in 2009, as Ameren was seeking a license to build a new reactor at the Callaway nuclear plant.
Some of the Republican opponents to the measure objected to the heavy lobbying pressure for the bill. State Rep. Don Mayhew, a Republican from Crocker, said there were “squadrons” of lobbyists “roaming our halls” but he hadn’t heard from any utility customers asking for the bill to be passed.
Instead, he noted, even his voters, who get their power from rural electric cooperatives, are worried about higher prices. Electric cooperatives are not regulated by the PSC.
“I’ve had no less than 25 emails from constituents who are concerned about this, and I’ve reassured them that they’re in coop, this doesn’t affect them,” Mayhew said. “But that doesn’t mean I shouldn’t care about my friends and the Kansas City and the St Louis areas.”
State Rep. Brad Pollitt, a Sedalia Republican, said power from generating plants built in Missouri is more reliable than power from plants built elsewhere. Pollitt sponsored one of the House bills to repeal CWIP.
“It’s important that when we flip the switch, our lights come on,” Pollitt said. “In agriculture, it’s important that when we have hundreds of thousands of dollars worth of grain and grain bins, that those dryers are going to work.”
Passage of the bill drew praise from business interests and scorn from environmentalists.
“Reliable, resilient and affordable energy is essential to retaining and attracting business to the state,” said Kara Corches, president and CEO of the Missouri Chamber of Commerce and Industry. “This legislation will help Missouri meet the growing demand for energy.”
The bill upsets the balanced utility ratemaking process that weighs consumer protection against utility profits, the Sierra Club said in a statement.
“This bill will financially harm families and businesses,” said Jenn DeRose, Missouri senior organizer with the Sierra Club, “because increasing electric bills several years before a power plant begins producing power will drive up the price of everything, from eggs to electronics and beyond.”
4 comments:
I don't live there but the rates of all electricity is way beyond means for senior citizens..who are on limited income..Do you ever take those people in account when you make these decisions? Doubtful..I'm on Liberty and we been paying higher prices than ever and paying on some kind of storm repair from few years ago which makes it about 25.00 higher..then they charge fuel fee(they don't come read meters but still charge)..If we made the kind of money you all make it wouldn't bother us..But not everyone brings in Thousands a month..It's literally ridiculous. Look at the community as a whole..not from your point of view.. unless you gonna help those who can't make the payments...Just saying....
^ WHAT HE SAID AND LOUDER!! Electric bills are outrageous
The Problem with Utility Companies - Is there is No Competition for the Consumer to use. You are Forced to use a Certain Company for Gas, Electric, Water, Sewer, Trash, Etc., - and then these Companies are Governed by Federal, State, or Public Service Commissions - Again, the thought of Government Agencies - Governing Anything - Is Scary since most Agencies, are fraught with Waste, Abuse, and Mismanagement - The Consumers can never Win and are at the Whim of these Bureaucratic Agencies - that are not looking out for us - but are paying their Lobbyist and Giving Political Donations to Buy their Will - .
Why do people expect the Republican party to do things to help them?
Post a Comment