ST. LOUIS, Mo. (KMOX) — Bad news for Ameren UE’s residential customers — they may be paying more for electricity, while businesses pay less.
As part of an ongoing rate hike request before the Missouri Public Service Commission, residential customers would pay an extra two-percent more for electricity, while businesses would be paying 1.8 percent less.
The proposed plan, which still needs approval of the MPSC, means if Ameren UE gets a 5% rate hike that residential customers will be hit with a 7% rate increase, while businesses will pay only 3.13% more than before.
Lewis Mills, Director of the Office of Public Counsel, which is supposed to represent consumers, says he signed off on the proposed deal, to avoid a lawsuit that could result in a higher cost shift to residential customers.
“There’s going to be a lot of evidence in the rate case that shows residential customer rates should go up a lot higher than what we agreed to,” Mills said.
The proposed higher rates for residential customers was recommended by several studies submitted in this case. Mills says those studies were authored by his office, Ameren UE , the PSC staff, and by a group of the industrial customers.
“As of right now, the residential customers are really getting kind of a break,” Mills said, “They’re really paying less as a group than it costs to serve them. And many of the other classes are really paying more than it costs to serve them.”
MIlls says residential customers require the large office staff to handle billing and customer service. Industrial customers are cheaper, Mills says, because they purchase a steady quantity of power billed to one address that doesn’t rise and fall with the seasons.
The proposed deal still faces the hurdle of a public hearing next week, but it has been okayed by the consumer-friendly AARP and the Consumers Council of Missouri.
In the back-scratching final days of the Missouri legislative session, the timing of the deal has raised intrigue. It was filed in the wee hours of the morning Thursday, just ahead of a PSC hearing on the issue. But also, just ahead of continued legislative movement on a bill that would allow Ameren UE to charge ratepayers in advance for costs associated with seeking a second nuclear plant at Calloway.
Quid pro quo? Mills denies there was a deal worked out with industrial customers to lower their coming rate hike, in exchange for dropping their opposition to the Calloway expansion.
“I don’t see any connection there at all,” Mills said, “As far as I know, this has got absolutely nothing to do with any pending legislation.”