Ameren seeks electricity price hike in cities around Columbia
Communities around Columbia might see an increase next year.
Aug. 25, 2009
AmerenUE, the state's largest utility company, has asked regulators for permission to raise its electric rates by as much as 18 percent, but the increase will not affect Columbia.
Ameren spokesman Mike Cleary said the increase would not directly affect MU students because the company does not provide electrical services to Columbia, only natural gas. Rates might go up in surrounding communities such as Ashland, Rocheport, Boonville and Moberly.
The company estimated the $402 million proposal would amount to an increase of about 50 cents per day for the average family. Its request comes as it is also asking for $185 million from the federal stimulus package to modernize its delivery systems. This is the company's third request for a rate increase since 2007.
Cleary said the increase, if approved, would mostly be used to pay for reliability improvements such as reinforcing pipelines and electrical poles, and to make up for increasing delivery costs of fuel.
"We've just got to put everything into perspective," Cleary said. "The reason for this increase is reliability. That's our No. 1 priority because it's the thing our customers have been asking us to improve the most."
Cleary said raising rates in a down economy might affect consumers. He said Ameren has a number of programs for customers to get assistance paying bills so they will not lose service. Those programs include the ability to make minimum payments and budget billing to help eliminate sudden seasonal spikes in a family's utility bills.
"The message we're trying to get across is: If you're having trouble paying the bills, call us early and don't wait until you get a cut-off notice," he said.
Ruth Ehresman, director of Health and Budgetary Policy for the Missouri Budget Project, said even with such programs, low-income families hit hardest by the economic crisis would face even more difficulties.
"We do know that many low-income families struggle to pay their utility bills already and a rate increase will always be problematic," Ehresman said. "We're always concerned when low-income families' ability to provide basic resources is made more difficult."
The request, submitted in late July, is pending approval before the Missouri Public Service Commission, which regulates utility rates. Public Service Commission energy director Lena Mantle said the commission staff will audit the company's books and hold hearings on the increase, but not until March 2010.
She said the commission will consider the economic impact the rate increase would have on consumers.
"The commission can and does take into account the economic condition of the consumer," Mantle said.
Mantle said several large companies and organizations in the state, such as Ford, Budweiser and the American Association of Retired People, will be parties in the hearings opposed to some or all of the proposed increases. She said the hearings will try to decide how much of an increase will be most beneficial.
"The staff's goal is to balance rates for all customers. The commission doesn't have a vested interest in any particular group," she said.
Missouri Public Counsel Lewis Mills, the state's chief consumer advocate, criticized the frequency and timing of Ameren's latest request.
"This one's a doozy because it comes at a really bad time with the economy the way it is," Mills said.