On June 28, 2024, Ameren Missouri filed a request for approval of a +15% increase in electric utility rates designed to increase Ameren’s gross revenues by approximately +$446.2 million. This request follows the June 14, 2023, Missouri Public Service Commission’s approval of a +$140 million increase in annual electric revenues for Ameren. It also follows the imposition of an approximate $1.50 per month “securitization” charge over the next 15 – 17 years on Ameren customers related to the closure of the Rush Island Ameren coal plant.
A recent study completed by Strategen for Consumers Council shows that over the past three years, Ameren’s residential customers have experienced significant recent increases in their electricity bills, outpacing both national inflation and local wages over the same period.
- The average summer residential bill rose by 19.56% from 2020 to 2023
- The average winter residential bill rose by 21.05% from 2020 to 2023
Strategen also found that these bill increases were not due to rising fuel costs. Ameren’s base factor fuel charge, a component of the volumetric rate that estimates the cost of fuel, has decreased over the last 7 years while volumetric rates have increased. Strategen concluded that infrastructure investments appear to be the principal driver of Ameren’s residential bill increases.
Consumers Council believes that this aggressive rise in distribution infrastructure costs is being boosted by an anti-consumer accounting trick that inflates the compensation which Ameren Missouri receives through its rates. This accounting trick, called Plant-In-Service-Accounting (PISA), was imposed by state legislation in 2018, and it adds about 15% extra to the level of your electric rates.
Ameren’s rate request was filed as soaring summer temperatures continue to create financial pressure for electric customers. The Energy and Policy Institute recently completed a review of Missouri utility disconnections and accounts in arrears. They found that disconnections between March 2024 and May 2024 for non-payment were consistently above 8,100 households, hitting a high of 9,781 in April 2024. Accounts in arrears rose from 191,309 in March 2024 to 202,560 in May 2024.
Consumers Council has intervened in this case. We will closely look at Ameren’s request, focusing on the additional costs to residential consumers, especially those least likely to be able to afford yet another rate increase. (See: ER-2024-0319)
