PSC opens case on surcharge proposals

Missouri’s Public Service Commission will hold a hearing April 8 on the proposed electricity surcharge bills currently being considered by the Legislature.

After getting a request from a lawmaker last Friday, the PSC’s members approved an order Wednesday morning that opens “an investigation to address legislative concerns” about the proposed laws, which would modify the ratemaking procedures affecting electric utilities.

A state law on the books since at least 1939 allows the PSC to “conduct a hearing and take testimony relative to any pending legislation ... within the jurisdiction of the commission, if requested to do so by the legislature (or) by the governor.”

New Chairman Robert Kenney said Wednesday night: “The mechanism is old, but us using it is new.

“I think this is a good mechanism that might serve as a model going forward, for how the Public Service Commission can properly weigh in on pieces of legislation.”

Several lawmakers — including Sen. Mike Kehoe, R-Jefferson City, sponsor of the Senate version of the surcharge proposal — have asked the PSC to comment on portions of the proposal.

But, Kenney said, the hearing process will allow all interested parties, and the general public, to comment on all aspects of the bills.

If lawmakers agree to the proposed law, Missouri’s three investor-owned electric utilities — Ameren Missouri, KCP&L and Empire District — would be able to repair and upgrade aging parts of their distribution systems, and add the costs of that work to customers’ bills, even though the PSC has not held a full rate case to approve the additional charges.

Supporters say the proposals give the commission an up-front chance to approve the additional costs — called “infrastructure system repair surcharges,” or ISRS — then have a more detailed study during the next formal rate case where the PSC could accept a previous surcharge, change it or reject it.

Opponents say the proposed surcharges are an unneeded, unfair burden on ratepayers that raise costs without improving benefits or services.

The PSC order said the unnamed lawmaker asked commissioners to analyze several issues, including:

• The “safety, adequacy and reliability of Missouri’s current electric infrastructure.”

• Electric utilities’ infrastructure problems, costs and needs.

• “Electric utilities’ financial need for legislation.”

• The impact on rates if a law is passed and implemented.

In addition to the 9 a.m. April 8 public hearing, interested stakeholders and the general public are invited to comment electronically, using the EFIS/Case filing link on the PSC website, www.psc.mo.gov, or by mail at P.O. Box 360; Jefferson City, Mo., 65102.

Written comments should include the specific file number, EW-2013-0425, and the online, electronic comments should be linked to that same number.

The PSC order said the commission “intends to issue its report to the legislature no later than Wednesday, April 17, 2013” — just 4 1/2 weeks before the Constitution requires the legislative session to end.

Kenney said: “We set that timeline because we did recognize that the General Assembly will adjourn in May, and we did want to, at least, complete our work in enough time to make it meaningful.”

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