Missouri Watchdog: St. Charles residents express outrage at Ameren power rate increase request

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By Johnny Kampis | Missouri Watchdog
ST. CHARLESDon Mitchell, a local mechanic, used his lunch break Wednesday to tell Ameren Missouri what he thinks about its request for a nearly 15 percent rate increase.

Clad in his greasy uniform and holding a symbolic plastic spoon, he told the men in suits that he can hardly afford the power bills he now faces during this unseasonably hot summer.

“What’s wrong with you people?” he asked with wavering voice. “I’m tired of feeding my kids with plastic spoons, while your kids get silver spoons.”

Ameren wants to increase its power revenue by $376 million with the 14.6 percent rate hike, which would cause the average monthly residential customer bill to increase by about $14 based on use of 1,100 kilowatt-hours. In the record heat this summer, most customers could be using more power than that. The increase would bump the current rate of 8.67 cents per kilowatt-hour to 9.94 cents.

Ameren and Missouri Public Service Commission officials are traveling around the state for a series of meetings, so Ameren officials can present their case and residents can voice their opinions.

Not surprisingly, the feedback on the proposal at the St. Charles County Government Building was heated.

Many wore “No 14%” stickers passed out by Fair Energy Rate Action Fund, a group created to lobby against the rate increase.

Ameren received a rate increase of 7 percent last August, and this would be the fifth in the past six years, if approved.

So why does the company need another one so soon?

Ameren vice president Dave Wakeman told the standing-room only crowd that fuel costs and infrastructure improvements continue to rise.

“We know now is not a good time to raise rates. It’s never a good time,” he said. “We want to keep electricity as low as possible, but reliability is important too.”

PSC isn’t buying Ameren’s case that it needs $376 million.

Auditor Roberta Grissum said PSC’s accountants and engineers tentatively have determined that the increase should be about half as much.

“Our position is it’s more like $210 million,” she said, drawing applause from the crowd.

She said Ameren wants a profit of nearly 11 percent, but PSC recommends the company gets a 9 percent.

Lewis Mills Jr., head of the Missouri Office of the Public Counsel, which represents the interests of the state’s utility customers, said he’d like the profit margin to be closer to its current 8 percent.

“We’re going to seek permission to award a profit margin at the lowest rate of what is considered reasonable,” he said.

Ameren officials said the national rate is closer to 10 percent. They note the company now offers electricity rates about 25 percent below the national average.

PSC is considering establishing a separate rate class for low-income customers, which could cause the rates of other customers to increase even more, Missouri Watchdog reported Monday.

A list of future hearings on the request is on Ameren’s website.

Visit the PSC website’s docket sheet session to view the case and leave a comment.

Enter case number ER-2012-0166 into the box to view the file, which includes testimony on the proposal and about 1,500 public comments.

The sessions conclude with a meeting Aug. 23 in Kirksville. Formal evidentiary hearings are scheduled from Sept. 24 to Oct. 12 in PSC’s Jefferson City offices. A decision on the rate hike is expected by the end of the year.