RELEASE: Timeline Shows that MO Infrastructure, Policies Too Old
Century-Old PSC Regulations, Mid-Century Equipment Need Updates
Jefferson City, MO – Missourians for a Balanced Energy Future plotted out the significant dates of the outdated policies and equipment involved in how Missourians receive their power to demonstrate that both are in severe need of upgrades. With electric rate regulations that date back over 100 years ago and electric facilities and equipment that are nearing 50 and 60 years old, neither is working effectively for Missouri consumers.
“When electric regulations in Missouri were created in 1913, the residential television and air conditioner hadn’t even been produced, not to mention the modern computer, which wouldn’t come to be for 37 more years. Now many homes are fully air conditioned and many have multiple TVs and computers, but the laws on the books that regulate electric companies haven’t changed,” said MBEF Executive Director Irl Scissors.
Scissors continued, “As a result, a lot of the equipment electric companies installed in the 50s, 60s and 70s, to keep up with the electricity demands from TVs, AC’s and PC’s, is coming to the end of its life, but it’s very difficult to make the needed investments until those century old policies are changed, too.”
Electric Regulations and Energy Infrastructure Through the Ages
1913 – The Missouri Public Service Commission was established to regulate a variety of businesses, including electric corporations. Regulations for electric companies were put in place for how infrastructure investments/upgrades are to be treated in rate cases. These regulations are still in place today.
1950s/60s – The era of electronics hit the consumer market, resulting in a wave of households investing in television sets, record players, and refrigerators. Demand for additional electricity increases.
1960s/70s – Utilities invest in additional infrastructure to supply consumers with adequate energy to power more modern appliances, including air conditioning in homes and businesses. Demand for electricity increases more rapidly. Much of that same infrastructure is in service today and is coming to the end of its service life.
1980s – 2000s – Growth in the electric market continued to escalate, providing increasing demand, and capital, for utilities to be able to bear the responsibility and costs associated with system expansion and facility repairs. In today’s stagnant economy, customer growth is flat, along with resulting revenues that are normally used for reinvestment.
2003 – The gas and water utilities sought and passed legislation to update old regulations over this industry that provided more incentive for industry investments in infrastructure improvements. Electric utility updates were not part of this legislation.
2011 – Energy efficiency legislation was signed into law, allowing electric companies with energy conservation programs to recover costs by adjusting rates under guidelines established by the PSC.
2000 – 2014 – Forty-four of 50 states updated their utility laws, leaving Missouri as one of the six states that have not. Those that have are rebuilding their utility infrastructure at a faster rate and providing hundreds of jobs in the process.
Today – Some utilities have continued to invest in infrastructure repairs. For example, Ameren Missouri has invested approximately $600 million each year for the past ten years. However, at a time when $2 billion worth of infrastructure needs to be replaced to make the grid current, growth is flat. Additionally, those century-old regulations still in place today penalize utilities working to make these improvements, providing little incentive to make far larger investments.
20th century regulations are determining the outcomes for 21st century energy needs. Electric equipment and facilities from mid-last century are struggling inefficiently to keep up with a digital age. Today, state legislators and utilities need to work together to find a solution to upgrade Missouri’s aging energy infrastructure.
The Future – If regulations do not change and more upgrades to energy infrastructure are not made, equipment will begin to fail and utilities will be forced to address emergency outages, which could leave consumers and businesses without power for extended periods of time. Power outages could result in a negative impact on Missouri’s economy and put families at risk.
If regulations are updated, upgrades to Missouri’s aging infrastructure can begin immediately, creating new jobs, benefiting consumers at a $1.50 on every $1 spent on capital improvements, and ensuring safe, affordable, and reliable power to Missourians.
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Contact: Adrianne Marsh (314) 827-6141
Missourians For A Balanced Energy Future | moenergyfuture.org |
