Missouri approves $172 million electric rate hike

Utility regulators gave the OK on a $172 million electric rate increase Wednesday for Ameren Missouri.

Initially, the St. Louis-based utility had requested $263 million when it proposed the increase in September 2010.

This rate increase will be effective next week. It will add $8 to the average residential customer’s monthly electric bill, said Kevin Kelly, a spokesman for the Missouri Public Service Commission.

Ameren Missouri (part of St. Louis- based Ameren Corporation), led by President and CEO Warner Baxter, claims it needed to raise customers’ electric bills to help cover the cost of the more than $1 billion in improvements it’s making to its energy infrastructure to improve reliability and comply with environmental regulations. Those projects include a $600 million upgrade and two scrubbers at the company’s Sioux plant to eliminate sulfur dioxide emissions.

The Missouri Public Service Commission decided Wednesday to not allow Ameren to recover costs for the Taum Sauk reservoir, which began operating again in April 2010 after four years of rebuilding and $490 million in construction following the reservoir’s catastrophic breach in 2005. That breach sent a 20-foot-high wall of water cascading through Johnson’s Shut-Ins State Park. The company has said customers would not pay for the rebuilding of the reservoir or costs already paid by insurance carriers but rather the costs for enhancements to improve the safety, security and reliability of the plant.

But the commission ruled that customers would not pick up the tab for Taum Sauk. “After the collapse, Ameren Missouri took full responsibility and promised to protect its ratepayers from the consequence of that collapse. The commission intends to hold Ameren Missouri to that promise,” the PSC wrote in its order Wednesday.

Adapted from post at www.bizjournals.com