Two-Thirds of Missourians Oppose Deeply Reduced Electric Rates for Large Industrial Users
JEFFERSON CITY – More than two-thirds of Missourians polled – 68 percent – say that large industrial corporations should not be allowed to continue to pay half the rate for electricity that small businesses and residential customers in Missouri pay. Only 25 percent say large industrial companies should continue to receive the much lower rate.
These results come from a scientific survey released today by Missourians for a Balanced Energy Future, a not-for-profit organization that focuses on energy issues.
“There is enormous public sentiment for reducing the current disparity in electric rates,” said Irl Scissors, executive director of Missourians for a Balanced Energy Future. “This is an interesting public policy issue that has important implications not just in terms of energy policy but, more generally, in terms of who receives the benefits of government action.”
In Missouri, total electricity costs are divided up among different rate classes including residences, small businesses and large industrial users. The government regulatory process through which the rates are established for each class is often hotly contested, and when one class succeeds in securing a lower rate for itself, the other classes must make up the difference.
Defenders of the lower rate for big industrial corporations often say the break is justified because these big companies create or maintain many jobs in Missouri.
However, according to the poll, most Missourians reject that idea. When asked which approach would create more jobs in Missouri – reducing electric rates for large industrial corporations and making everyone else pay more to make up the difference or reducing electric rates for families and small businesses and making large industrial corporations pay more to make up the difference – 57 percent say reducing electric rates for families and small businesses would create more jobs. Only 25 percent say reducing electric rates for large industrial corporations would create more jobs.
In fact, 61 percent of respondents said that giving big industrial corporations a reduced electric rate does nothelp to create more jobs.
“Policy makers need to weigh several factors when setting electric rates,” said Scissors. “It’s not enough just to look at economic development considerations. We also need to look at the costs of service delivery and basic questions of fairness when it comes to pushing off costs from one rate class to another.”
Two-thirds (66 percent) of the poll respondents say that a large industrial company that pays about half the rate small businesses and residential customers pay should be required to maintain at least 1,000 jobs in Missouri. In fact, Missouri State Representative Jay Barnes has introduced legislation, HB 957, along with 46 co-sponsors, that requires the corporation receiving the most deeply reduced rate (Noranda Aluminum), to maintain at least 200 jobs in Missouri or be forced to pay a higher rate.
Sixty-three percent of respondents say that companies based outside of Missouri should be disqualified from receiving a reduced rate.
And 65 percent of Missourians support having a law that makes sure families and small businesses are not “subsidizing” the electric rates of large corporations.
The poll of 637 registered Missouri voters, conducted by North Carolina-based Public Policy Polling between April 15 and 17, has a margin of error of 3.9 percent. Full results of the poll are available here.
