Liberty Offers Rate Increases for Missouri and Kansas Customers | Local News
Liberty filed a claim with the Missouri Civil Service Commission on Friday that could result in two increases for its Missouri clients. She also filed for a smaller, abbreviated increase for her Kansas customers. No deposits have been announced for its Oklahoma or Arkansas customers at this time.
Missouri’s application, if approved in its entirety, would increase the bill for its typical Missouri electric customer by $ 12.76 per month – 9.68% – defined as someone using about 1,000 kilowatt-hours per month. This part of the increase would recoup the Joplin-based utility’s recent investment in wind turbines, solar power, smart meters, infrastructure upgrades and more.
The other portion of the claim, if approved, would show up as a new line item on customer bills and cover the cost of natural gas during arctic weather conditions in February, when Midwestern utilities saw spikes. record prices. That would be $ 7.08 per month for 13 years, or over $ 84 per year, or over $ 1,000 in total for that same typical customer.
Applications will be reviewed by staff at the Missouri PSC and the Missouri Office of Public Counsel, who will make recommendations to the Commissioners. A decision is not expected until next spring.
Wind farms and more
Liberty has spent several years building 69 wind turbines at its North Fork Ridge wind farm in Barton County, 69 more wind turbines at its Kings Point wind farm near Golden City, and 139 more turbines at its Neosho Ridge wind farm north of Parsons, Kansas.
Together, the three wind farms will produce 600 megawatts of electricity for the utility and are a key part of its transition to renewable energy.
In 1997, the utility – then The Empire District Electric Co., produced more than half of its electricity from locally burnt coal and also purchased around 40% of its electricity – much of it coal as well. With all turbines in line, the utility will be around 40% of the wind power owned by Liberty, with another 10% of the wind power purchased and 21% of the coal (produced and purchased locally) and 25% of the gas. natural. Liberty also gets a small percentage of its electricity from the Ozark Beach Dam (Taneycomo).
The three wind farms represent an overall investment of $ 1.2 billion, according to Liberty officials, but since there is no cost of fuel, they say it will be cheaper for long-term customers than stay on fossil fuels for generations.
“We believe this saves our customers money in the long run. It’s also better for our environment, ”said Tim Wilson, vice president of electrical operations for the central Liberty region.
Under Missouri regulatory rules, utilities are not allowed to request a rate increase until the investment is “used and useful,” which means it is on-line and fully operational. that wind farms are now, according to company officials.
The rate request also includes the clawback of $ 43.5 million the company invested in smart meters for its Missouri customers and the several million it invested in its first solar farm.
Smart meters are digital meters that, when fully installed, allow customers to access near real-time information on their energy consumption. The utility plans to launch the platform soon, which will allow customers to connect through a website and / or mobile app so that they can more closely manage their power consumption.
Earlier this year, Liberty also completed a 2.2 megawatt solar farm near Prosperity in Jasper County. Liberty officials said the solar farm was a pilot project and more solar operations were planned in the area.
Wilson said the utility has also invested in strengthening and improving its system, including new substations, thousands of wildlife wardens to prevent blackouts, and disconnect devices that automatically isolate an outage for the least. customers possible.
“We have really worked on our reliability,” Wilson said.
The claim also includes the cost of repaying debt for its Asbury coal-fired power plant north of Joplin; the plant has been converted into an Asbury Renewables operations center, Wilson said.
“It’s really our renewable energy hub now,” he said.
The other portion of the rate hike will cover the cost of purchasing natural gas for Liberty when prices spiked in February due to the extreme and prolonged cold spell in the Midwest and South which Liberty and d other utilities, created record demand and even forced outages in running power.
The PSC opened an investigation into the operation of investor-owned utilities in the state, including Liberty, during this period, but no report was prepared.
Temperatures that fell as low as minus 15 degrees in Joplin on Feb. 16 resulted in power outages and “extreme natural gas spikes in Missouri,” the PSC statement said. The lowest equals the coldest temperature recorded at Joplin in over a century; Joplin also reached minus 15 degrees in 1989.
Liberty said its wind turbines continued to operate, but had cut production at its gas plants due to availability and its coal-fired plants due to the coal freeze.
Aaron Doll, senior director of energy strategy, said market prices for a megawatt of energy are typically around $ 20 at this time of year.
“We had prices that were on average in the $ 4,000 range for a sustained period of four or five days,” Doll said.
He said the utility typically purchases some of its fuel at the start of the month.
“We’re trying to buy about 50% of what our units are going to expect,” he said, referring to the State Line and Riverton plants, which burn natural gas.
Doll noted that their buying contacts are being reviewed and assessed to see if they are cautious by state regulators. When asked if they buy natural gas on long-term contracts, Doll said this has been an issue in the past by the state’s Public Council Office, which represents taxpayers before the PSC, because if the tariffs were reduced, the customers would be blocked at the highest. prices.
The cost of fuel is passed on to customers and typically appears as a separate charge or credit on customer invoices.
Not only did Liberty have to buy some of its natural gas at a higher price, it was also concerned that it would not be able to get gas because the wells were taken out of service in the cold weather.
Doll said if they didn’t spread the cost of fuel over 13 years, customers would see a more dramatic increase in their bill, but in the shorter term.
Charlotte Emery, senior director of tariffs and regulatory affairs, said another option may be available to customers, but that depends on the governor’s support.
This spring, Missouri lawmakers passed a measure that would allow bond issuance to pay for utility obligations, including fuel costs during extreme weather conditions. In return, consumers would see a tariff added to their monthly bills to reimburse the deposit. If Missouri Governor Mike Parson signs the legislation, it would be explored as an alternative to the proposed monthly fee of $ 7.08 and considered independently removed in whole or in part from the current rate case.
In a statement, David Swaim, president of Liberty Central Region, said, “We recognize the hardships this extreme weather event, associated with the pandemic, has had on customers. Over the past year, we have taken a number of steps to help customers. These included stopping service disconnections for non-payment at the onset of the pandemic, offering expanded payment terms and connecting customers facing financial difficulties with available resources. Our efforts to help customers continue as we address the aftermath of winter storm Uri. If the costs are not spread over an extended period of time, as we have requested, our customers will suffer. We are taking the necessary steps to make sure this does not happen and that we keep the energy affordable. “
Empire also filed an application with the Kansas Corporation Commission to adjust base electricity rates for its Kansas customers. The typical Kansas customer using 1,000 kilowatt-hours per month would see their monthly bill increase by $ 4.97, or 4.47%, the company said. This would be to recover the cost of investments in renewable energies and the strengthening of infrastructure.
No deposits have yet been made in Kansas for winter storm cost recovery.
Price history with Liberty
This is the second full-rate deal Liberty has sought for southwestern Missouri since acquiring Empire in 2017.
Liberty filed an application in August 2019, asking to increase its annual electricity revenues by $ 26.5 million in Missouri. Liberty customers in southwest Missouri would have seen their monthly bills increase by 5.9% if the rate request had been approved in full, and a customer using one thousand kilowatt hours of electricity per month would have seen the bill increase. of $ 7.85.
The Missouri PSC only allowed an annual increase in revenue of $ 992,400, meaning a residential customer using one thousand kilowatt hours per month would see an increase of 48 cents per month, or 0.37%.