Missouri regulators reject Ameren efficiency plan

Dive Brief:

Missouri regulators have rejected an efficiency program proposed by Ameren, saying they could not ensure that ratepayers not taking part in the program would also be receiving the benefits, the St. Louis Post-Dispatch reports.
The efficiency program would have cost consumers up to $300 million over three years, but the Public Service Commission noted that the majority of the state's power customers do not participate and their benefit cannot be assured.
Regulators said the program needs better methods to determine if the efficiency measures are effective, and also criticized Ameren for not including supply-side earnings reductions related to lowered demand.

Dive Insight:

In a statement, Missouri regulators rejected Ameren's bid to continue its energy efficiency program, explaining at great length that the commission cannot ensure customers not involved in the program are still benefitting.

So far, Ameren's efficiency program put more than $100 million toward energy efficiency, which also provides rebates to customers who purchase efficient appliances such as air conditioners and refrigerators.

The Public Service Commission voted 5-0 against the program that was proposed under the Missouri Energy Efficiency Investment Act (MEEIA). But the PSC said in a statement "it is the Commission’s hope that Ameren Missouri will consider the Commission’s decision and present a new MEEIA plan that all parties and the Commission can support."

"MEEIA is permissive in nature and, by its express language, does not require utilities to offer demand-side programs," said the PSC. "MEEIA allows such demand-side programs only so long as those programs are approved by the commission, result in measurable demand or energy savings, and are beneficial to all customers. The commission is thus responsible for reviewing a utility’s MEEIA plan and determining whether the plan accomplishes the goals of MEEIA."

The utility has clashed in the past with the Missouri Office of Public Counsel, which represents ratepayers, and the PSC staff over how to design the second round of its efficiency program, the St. Louis Post-Dispatch reports. The public counsel and staff desired better auditing procedures to ensure the utility doesn't overcharge customers for the program.

Ameren Missouri's MEEIA plan would have cost $250 million to $300 million for years 2016-2018, but regulators said it failed to include adequate mechanisms to verify that all ratepayers were benefitting from the programs. The program provides rebates for energy-efficiency appliances, and subsidizes the price of efficiency lightbulbs through deals with retailers.

"Simply put, the Commission would approve a MEEIA plan if non-participating ratepayers would be better off paying to help some ratepayers reduce usage than they would be paying a utility to build a power plant. Unfortunately, that is not the case here," said the commission. "The evidence in this case shows that most Ameren Missouri customers will likely receive very little, if any, overall net benefits from the Utility Plan. Approximately 87% of Ameren Missouri’s customers are residential customers. And a vast majority of those do not participate in MEEIA."