By Irl Scissors
During the 2018 Missouri legislative session, more than 85% of legislators supported Senate Bill 564 (SB 564), which centered on modernizing the energy grid and the regulatory process for Missouri’s investor-owned utilities, which include Ameren Missouri, Kansas City Power & Light (KCP&L) and Empire District Electric (Liberty Utilities).
This forward-thinking energy bill included a variety of consumer benefits, including a rate cut, rate freeze and rate caps that will stabilize energy costs for homeowners, business owners and just about anyone who pays an electric bill from these companies over the next five years.
The centerpiece of the legislation was a plan to allow for the modernization of the energy grid with technology and infrastructure upgrades that will minimize and reduce service interruptions for electricity users across the state, creating a smarter and more energy efficient grid.
Rate Cuts Already Making an Impact
Also, and most important to many consumers, language in the bill set August 1 as the start date for rate cuts for many Missouri electric consumers. These cuts were set in motion at the federal level with the passage of the Tax Cut and Jobs Act passed in late 2017. Ameren Missouri customers saw a 6% rate drop on their bills. The other IOU’s followed suit with rate cuts of their own saving well over a million and a half Missouri home and business owners tens of millions of dollars. Do the math. Senate bill 564 is leading to major savings for electric consumers in Missouri.
Utilities in Missouri are moving forward implementing other provisions of the bill, including Ameren Missouri’s plan to spend an additional $1 billion on infrastructure upgrades over the next five years. A billion dollars in infrastructure means thousands of jobs and major economic development across the state. Consumers and businesses alike will reap these rewards as energy costs become more manageable and predictable, allowing for greater spending power which fuels Missouri’s economy. All happening while electric consumers experience the benefit of rate relief.
Incentives to Attract New Business
Another byproduct of the legislation is a special economic rate incentive for industrial customers that encourages Missouri businesses to expand and also attracts out-of-state companies to locate here; making Missouri an even better place to do business and hire workers. The special incentive includes an average utility rate discount of up to 40 percent on new electric load, per the criteria, over a five-year period. An additional 10 percent discount could also be allowed in the sixth year, if certain conditions are met. Not only will this new incentive create thousands of new jobs in communities throughout the state, but new or expanded business translates to more energy usage on the system, which equates to spreading fixed costs to more customers, further keeping rates stable and affordable for everyone.
One of the first companies to take advantage of the special economic rate incentive was Quaker Window Products, when they recently announced a $65 million expansion in Eldon, MO, which will create 300 additional jobs.
In the press release announcing the expansion, Governor Parson aptly stated: “We love it when homegrown Missouri businesses choose to continue growing in our state. To make this project happen, it took a lot of collaboration between state and local partners, across workforce, economic development and government.”
You will see future ripple effects of this expansion as partnerships are in place between the Eldon Career Center and Quaker to work with the local high schools offering apprenticeships to students with the goal of transitioning students into full-time careers with the company; an absolutely incredible, long-term, and sustainable economic benefit for this Missouri community.
Renewables on the Rise Once Again
Thanks in great part to the passage of SB 564, Missouri consumers and utilities alike are benefiting from more locally sourced renewable energy. Even though the temperature outside is dropping, the sun still shines and the wind still blows, which means there is ample opportunity for Missouri to generate its own renewable energy from these sources.
Picking up where the success of 2008’s Proposition C left off, Missouri utilities are re-instituting a solar rebate program allowing for homeowners and small business owners to apply for solar rebates that will help defray some the of the costs for solar installations. Approximately $53 million in rebates will be divided up amongst Missouri’s investor owned utilities and spread out over the next five years. As it did, ten years ago you can expect to see another uptick in jobs and economic development in the solar space, a big win for Missouri’s locally-sourced energy economy.
New solar will not only be on the rise for Missouri residents and small business owners, but utility scale solar projects will continue to pop up across our state.
On the eastern side of the state, Ameren Missouri is launching its Community Solar program allowing individuals and business owners to purchase solar energy directly generated from a new solar facility to be built near St. Louis Lambert International Airport. By enrolling, individuals can purchase up to half of their annual energy from this local and affordable energy source. Whether you are a property owner or renter, anyone can participate in this innovative program. Similar programs are also available in Excelsior Springs and in the central part of the state.
On the west side, KCP&L is getting in the game announcing a similar program allowing consumers to purchase solar power who may not otherwise have the ability to install solar panels at their home or business.
Missouri’s IOU’s are not the only ones investing in large-scale solar as other communities such as Nixa and Springfield are entrusting a portion of their energy needs to the sun.
Wind continues to be a source of new energy generation in Missouri as various utilities and the University of Missouri continue to see its benefit for the grid.
In central Missouri, our flagship institution, the University of Missouri – Columbia continues to study the economic impact of local wind energy generation. Students are going out into the field to find the best wind generating locations and prospects for economic development. They are creating a public resource to help Missourians assess the various benefits and drawbacks of wind as an energy and economic resource for their community.
On the west side, wind farms are popping up in strategic locations. Empire District Electric is making major moves toward more wind power as it plans to construct a wind farm in southwest Missouri bringing new jobs and economic development to that area.
In northeast Missouri, Ameren Missouri continues its investment in infrastructure and new jobs by building what will be the largest wind farm in the state. The 700 megawatt project will support upwards of 500 construction jobs and create a valuable tax base for the local communities. And just last month, Ameren Missouri announced a second wind farm to be built in northwest Missouri.
In the short time since its passage, SB 564 has already shown great benefits for Missouri homeowners and small and large business owners alike. Jobs are being created, energy infrastructure is being constructed, and local communities across the state are benefiting from this activity.
With new job creation, economic development, and more locally generated renewable energy, Missourians can continue to expect more stable electric rates, a smarter grid and more efficiently generated electricity for the long-term. The future looks bright in Missouri!
This opinion piece appears in the January 2019 Missouri Times Magazine.