Consumers Council of Missouri

PSC poised to approve controversial utility rules

By Jeffrey Tomich

ST. LOUIS POST-DISPATCH

02/28/2008

Missouri regulators are poised to approve rules today that would help AmerenUE and other utilities more quickly recoup billions of dollars of environmental costs.

Initially drafted in October, the rules stem from legislation signed by Gov. Matt Blunt in 2005 over the cry of consumer groups, who complained the measure would needlessly increase rates and potentially boost utility profits.

Consumer advocates fear the rules will be overly vague, lack adequate consumer protections and open the door for utilities to raise bills without the close scrutiny of a full rate case, a thorough audit of a utility’s books that looks at all expenses, not just those that are going up.

“Any time you’re allowing utilities to raise rates without a full rate case, you run the risk of the utilities making more than they should and customers paying more than they should,” said Missouri’s Public Counsel Lewis Mills Jr., who represents utility consumers.

St. Louis-based Ameren, which sells electricity to 1.2 million customers in Missouri, said the environmental surcharge wouldn’t generate additional revenue; it would just allow for quicker reimbursement of costs incurred because of government mandates.

Allowing for a faster recovery of costs would help cash flow and reduce borrowing costs, potentially aiding customers over the long term, spokeswoman Susan Gallagher said. The rules also could provide an incentive to quickly retrofit older coal plants with pollution controls, rather than to defer improvements.

Ameren plans to spend as much as $2.12 billion through 2016 to comply with federal environmental regulations aimed at reducing emissions of pollutants such as sulfur dioxide and mercury. Statewide, utilities face more than $4 billion in environmental costs, according to the Missouri Energy Development Association, the lobbying group for the state’s utility industry.

The environmental surcharge would be capped at 2.5 percent of a utility’s gross revenue, according to the 2005 law. AmerenUE’s revenue exceeded $2 billion in 2007.

If approved, the rules wouldn’t have an immediate impact. Utilities would have to individually seek authority from the PSC before they could add a surcharge.

Ameren is expected to do so when it files for an electric rate increase this spring. But it’s not a given that regulators would approve the surcharge. In 2006, the PSC adopted similar rules to let utilities collect fuel expenses through a special surcharge, but the commission declined a request by Ameren to use the surcharge.

The chairman of the PSC, Jeff Davis, said any rules approved would contain ample consumer protections, including a prudence review every 18 months and a full rate case before a surcharge is implemented and another four years after.

“You’re going to have two shots in a four-year period to look at everything,” Davis said. “We’re going to have more access to their books than we’ve ever had before.”

John Coffman, an attorney for the AARP and Consumers Council of Missouri, is skeptical of the surcharge because it removes the incentive for utilities to keep costs down.

“The surcharge is just about boosting revenue and shifting business risk onto consumers,” said Coffman, Missouri’s former public counsel. “It’s potentially the biggest boondoggle we’ve seen of this type.”

How to tell if your stove is a potential killer

By Michael Sorkin

ST. LOUIS POST-DISPATCH

02/22/2008

Contact the Savvy Consumer , The Savvy Consumer is watchdog for consumer issues. , Send your tips for news stories or column topics to , msorkin@post-dispatch.com (P-D)

The government’s safety agency finally recalled a stove. Not one of the stoves the government has known about for years, the ones that tipped over and killed or injured at least 100 people.

This is a toy stove.

The U.S. Consumer Product Safety Commission recalled the “My First Kenmore” play stove last month after one of the toys tipped over and bruised a child.

RELATED LINKS

Public Citizen:

Association of Home Appliance Manufacturers

For information on the Sears stove settlement

Read previous Savvy Consumer columns

It’s the only stove the agency has recalled since Congress created the CPSC in the 1970s.

What about the tens of millions of real stoves manufactured since the 1970s and 1980s that can be unstable unless an anti-tipping device is installed?

The safety agency says its records show that freestanding or slide-in stoves have caused at least 33 deaths and 84 injuries from 1980 to 2006. Consumer groups say many more cases have not been reported.

How ironic is it, asks Ed Mierzwinski of the consumer group U.S. PIRG, that the safety agency was “quick to negotiate a recall of a play stove after one minor injury,” but then “wouldn’t protect the public from the larger reported risk of injuries and deaths from real stove tip-overs”?

The safety agency says it considers voluntary standards for manufacturers and retailers to be adequate.

Chances are your mother’s stove was too heavy to tip over.

Not the modern range. Although the geometry is the same — a door that opens wide to remove your big Thanksgiving turkey — today’s ranges are lightweights compared to their ancestors.

Put pressure on the door and it will act like a fulcrum. Your stove can tip over like a seesaw.

Alta Mae Rogers had just finished baking cookies at her home in Vermont in September, 2005, when she felt dizzy and leaned on her stove door for support, according to an account in the Worcester Telegram newspaper. The stove door dropped open and she fell on top of it.

The entire stove then fell on top of her, trapping her inside the 375-degree oven for more than an hour until a delivery man heard her cries for help. She was rushed to a hospital and died three weeks later.

“For most people, it is incomprehensible that even a 30-pound child can tip over a 100-pound range,” says Dan Sciano, a lawyer in San Antonio who specializes in tipping stove deaths.

He says the appliance industry has long recognized that a child tall enough to reach an oven door handle can tip over the range.

Manufacturers don’t dispute the risk.

“The tragedy is that it is totally, virtually 100 percent preventable,” says Chuck Samuels, a lawyer for the Association of Home Appliance Manufacturers. The group offers safety tips on its website.

The fix is easy: an L-shaped safety bracket that anchors the range to the wall or floor.

The anti-tipping devices have been included with each new range sold for about 20 years. But Samuels says retailers, installers and consumers often fail to install them.

“Someone literally has to throw away the bracket, which is sitting in the middle of our oven,” ready to be installed, Samuels says.

Sears recently agreed to install safety brackets on an estimated 3.9 million freestanding or slide-in ranges — all brands of stoves the company sold and installed from July 2, 2000, through last Sept. 18.

Sears also will install the anti-tip devices on all ranges sold and installed for three years thereafter. The agreement settles a class action suit in Madison County.

The settlement applies only to Sears stoves, but consumer groups hope other manufacturers and retailers will voluntarily go along.

Meanwhile, readers are asking about their stoves: How can they tell if they’re safe?

We checked the website at the CPSC because the agency told us it has “put out messages that consumers should use the brackets offered to them.”

But the only thing we found was a press release from Aug. 1, 2007, warning that, “Furniture, TVs and ranges can tip over and crush young children.”

After we asked Public Citizen if they had any advice, the group posted stove safety tips on its site at citizen.org.

Consumer advocates say stove safety is the latest issue highlighting CPSC’s failure to take action against dangerous products. The advocates now are readying for a battle as Congress prepares to vote soon on whether to give the CPSC stronger powers. Public Citizen is posting updates at www.toyingwithsafety.org.

msorkin@post-dispatch.com | 314-340-8347