Consumers Council of Missouri

CONSUMERS’ COUNCIL OF MISSOURI
ADVOCACY * EDUCATION * INFORMATION * FORUM
TODAY is February 16, 2011: The CCM Spotlight shines on…

Hot topics at the Missouri General Assembly

• SB 50 ANTI-CONSUMER IMPACT: AMEREN’S PLAN TO SHIFT NUCLEAR PLANT COSTS TO CUSTOMERS.

   CCM BOARD MEMBER B. RENEE MARVER TO AMEREN: “DON’T FOIST YOUR RISK TO RATEPAYERS!” Letter To Editor Stl Post-Dispatch 2-14-2011
Ameren Missouri wants the additional revenue it can generate from a new nuclear plant, but it doesn’t want to pay for planning the new plant’s construction. Instead, in clear violation of a law prohibiting a utlity from charging ratepayers for any construction work in progress, Ameren wants ratepayers to pay for planning and other associated costs. Isn’t that what capitalism is supposed to be about?
Evidently, Ameren has become comfortable with its guaranteed return on investment and wants to push the envelope at ratepayers’ expense.
Ameren should follow the law. If it doesn’t think the risk is worth taking, it shouldn’t take the risk. And it shouldn’t foist the risk off on ratepayers.
B. Renee Marver • St. Louis Board member, Consumers Council of Missouri

  Senate Bill 50 burdens Missouri ratepayers with financing Ameren’s planning costs for a second Calloway nuclear power plant before it delivers even one kilowatt of electric to the customers’ homes and businesses. SB 50 is anti-consumer and should not be enacted. It is not a question of pro-nuclear or anti-nuclear or even a question of whether or not another Calloway plant is a prudent decision. The issue is whether utility customers must give up the hard won voter approved ban on rates that include construction work in progress to finance Ameren and other utilities early site planning. Does SB 50 justify abandoning that consumer protection?
Today, the law initiated and adopted by the voters in 1976 bans utilities from charging ratepayers for “construction work in progress” (cwip) for nuclear plants, including planning, construction and other associated project costs. Only when the plant comes on line to actually provide service to ratepayers is the utility authorized to recover its costs in its monthly service rates. Missouri’s existing law embodies the long standing basic principle of utility law that ratepayers can only be charged rates for assets and expenses that are “actually used and useful” in providing service. The utility is only allowed to recover its allowable costs for the construction and operation of the plant through the service rates when the customer receives the benefits. Senate Bill 50 allows the utility to increase current rates to recover costs for obtaining the Nuclear Regulatory Commission’s Early Site Permit, a study of site environmental characteristics, safety and emergency preparedness. Senate Bill 50 opens a crack in this legal wall of consumer protection that can turn into a flood of unfair, unjust and unreasonable rate increases.
[Commentary by Mike Dandino]

   REPORTS FROM 2/15 BILL HEARING: Opponents and proponents of Ameren’s risk shifting bill discuss compromises that include limits on cost recovery, refunds to customers, and new funding sources for Office of Public Counsel

PAYDAY LOANS
• PAYDAY LOAN REFORM FILED BY REP. MARY STILL
Payday loan reform bill follows record high interest rates 1-10-2011
State Representative Mary Wynne Still (D-COLUMBIA) filed House Bill 132 to reform the abusive practices of payday lenders operating in Missouri and to limit the amount of interest charged to 36 percent Annual Percentage Rate. Still’s action followed the release of a new report by the Department of Insurance, Division of Finance documenting a new record high Annual Percentage Rate (APR) of 444.61 for the average Missouri payday loan. The report can be found at http://finance.mo.gov/consumercredit/paydaysurveys.php

• PAYDAY LOAN INDUSTRY PROPOSES PHONY “REFORM” BILL
Industry tries to thwart real reform with window dressing measure and uses unjust and unreasonable surcharges used to hide cost of loan.

HOT TOPICS AT PSC

Rate Increases Filed

   RATEPAYERS ALERT:

IF YOU WANT THE PSC TO KNOW, YOU MUST GO!

PUBLIC HEARINGS SCHEDULED FOR CUSTOMER INPUT
Go to Public Hearings, sign in to speak and tell the PSC what you think or it will not know how ratepayers stand on rate cases.

AMEREN IS BACK AGAIN FOR MORE OF CONSUMER’S MONEY
     Ameren has had 3 rate increase cases within the past 4 years. Since 2008 Fuel Adjustment Clause surcharges have increased rate volatility that the FAC brings and the fact that these rate changes occur without a full audit or a full scrutiny of Ameren’s corporate profits..
   PSC public hearings set for February & March

Other PENDING MAJOR RATE CASES AT PSC

Kansas City Power & Light — ER-2010-0355
What’s at stake?: $92.1 million (average residential customer would see an increase of approximately $12.69 per month)
 KCP&L Greater Missouri Operations (MPS Division) (Case No. ER-2010-0356)
What’s at stake?: — $75.8
KCP&L Greater Missouri Operations (L&P Division) — $22.1 million
Fact Sheet
Ameren Missouri (Natural Gas Service) — $11.9 million
Fact Sheet
 Empire District Electric Company — $36.5 million

AMEREN THROWS CUSTOMERS UNDER THE TRAIN IN LABADIE TRACK AGREEMENT
Will consumer pay for imprudent litigation costs?

  AmerenUE has adopted the same cavalier attitude it has toward customers to suppliers/vendors. Ameren not only bought a railroad track usage agreement, it bought -intentionally–bought litigation it planned to bring to set aside material terms of the agreement.
   Sounds like less than prudent business practices. Lack of good faith in negotiating and entering into the agreement seems like a questionable business decision and exposes the company’s ratepayers to legal costs, etc.
  Should the costs not only of this litigation but all costs that were incurred in negotiating and entering into this agreement in bad faith be excluded from rates or other expenses? CCM commentary by Mike Dandino

WATCH YOUR INBOX FOR MORE CCM SPOTLIGHTS
WHEN THE WEBSITE IS UPDATED.