- Since 2007, the individual whom Ameren Missouri calls its “typical residential electric customer” has seen his monthly electric bill go up 31 percent, to $96 a month.
Four years ago, “Trec” was paying $66 a month for 1,000 kilowatt hours of electricity. Four rate increases in a little more than four years — the latest a 7 percent, $172 million bump approved last week by the Missouri Public Service Commission — have whacked Trec pretty hard.
Trec isn’t helping himself much — he’s doing a lousy job of conserving energy. Ameren reckons Trec now is using 1,100 kwh of power each month, up 10 percent from 2007.
Trec should think about cutting back because his other utility bills are going up, too. Metropolitan Sewer District says its average customer’s sewer bill will go up by $20 a month by 2015. If Trec lives in the city of St. Louis, his water bill is up 12 percent this year and 50 percent since 2004. Trec-in-the-city also is paying a new $11-a-month trash pickup fee.
If Trec is a St. Louis County customer of Missouri American Water Co., his water bill is up $44 over last year. The company has asked the PSC for another increase of 20 percent to 23 percent. Trec’s natural gas bill went up a couple of bucks a month last year, too — plus the wholesale gas price increases that Laclede Gas Co. automatically passes along.
Let’s assume Trec is typical in other ways. Let’s assume his family’s income is right in the middle for a Missouri household — $45,149. Between 1998 and 2008, Missouri’s median household income dropped 14.6 percent, the steepest drop of any state in the nation.
Back before the Reagan Revolution began tilting the economic table toward corporations and the wealthy, working-class consumers like Trec had a fighting chance to stay even with utility rate increases — and increases in the prices of other necessities of life. Maybe he’d get a raise, or move up to a better job. He may even have voted for Ronald Reagan.
Now, even if Trec is employed and his house isn’t being foreclosed upon, he’s struggling to keep his head above water. Republicans tell us that more tax cuts will fix things. They haven’t since 2000, though corporate profits are at an all-time high. As a regulated utility, Ameren is guaranteed, under the latest rate approval, the right to earn up to 10.2 percent return on equity.
Ameren doesn’t earn that much; it was 7.8 percent last year. The company expects that to grow this year to between 8 percent and 9 percent.
If Trec got an 8 percent raise this year, he just about could keep up with rising costs of utilities, gasoline, groceries, health care and other basics.
Ameren is only doing what companies do in this era of limited corporate obligations: looking out for its investors and employees.
About half of the latest rate increase is attributed to pollution controls installed at its Sioux generating station in St. Charles County. Clean air is a social good, the costs of which are socialized.
But it’s curious that the PSC gave Ameren a $31 million break because of uncertain economic conditions that caused Ameren to slow down work at the Sioux plant. The commission was unwilling to extend the same break to consumers, ruling:
“Many witnesses who testify at local public hearings offer heartfelt and frequently heartbreaking accounts of how they are suffering from the economy in general and high utility rates in particular. As the commission heard frequently at those hearings, many customers want the commission to ‘just say no’ to any proposed rate increase.”
However, the commissioners said, “the utility is entitled to charge rates sufficient to cover its costs.”
Down at the bottom of the economic food chain, Trec can’t pass on his increasing costs, nor can he count on keeping with them. One of these days, Trec will decide to fight back.
Read more: http://www.stltoday.com/news/opinion/columns/the-platform/article_848345ef-d191-5526-be73-5ed5f525a435.html#ixzz1SUQrsUBi
