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This Week in the PSC: September 18, 2019


JEFFERSON CITY, Mo. — Multiple orders regarding probes into Missouri utility companies were before the Public Service Commission (PSC) Wednesday afternoon. 

The PSC approved a notice regarding a staff report investigating Rex Deffenderfer Enterprises, or RDE Water Company. The utility company services more than 1,100 in Nixa, having first received a certificate of convenience and necessity from the PSC in 1997. 

The staff report alleged the company has not accomplished “most of the items” it previously agreed upon in a 2016 rate case, hasn’t filed annual reports, and did not cooperate with the investigation. The report also said employees have admitted they do not open mail from the PSC and recommended RDE’s assets be placed under the control of a receiver. 

As for the inspection of the company, the report alleged some pipes within the high service building show signs of corrosion in addition to leaky cooling hoses. The well houses and the company’s brick and mortar buildings are also in need of repair, the report said, citing deteriorating mortar between bricks, corroding metal door frames and shingles, and rotting wood structures. 

The report also included concerns regarding an emergency backup well that tested positive for e. Coli in 2011. While no positive samples have been recorded since, staff still had concerns about how the company would utilize the well should it ever be needed. 

“Staff concludes that RDE has thoroughly demonstrated it is either unwilling or unable to provide safe and adequate service to its customers,” the report, filed Aug. 30, stated. “By failing to properly disinfect the drinking water, conduct repairs to ensure adequate pressure is maintained, and failure to comply with [Department of Natural Resources] administrative orders, RDE is not sufficiently safeguarding the public health.” 

It further said RDE “has demonstrated that it lacks the administrative ability to properly operate a regulated utility, or is not interested in conducting the administrative functions necessary to properly operate as a regulated utility in this state.” 

In approving the notice Wednesday, commissioners said staff would need to file a formal complaint or a new file in order for the PSC to take further action. The approved noticed simply acknowledges the report and closes the file. 

“I must say, I am troubled by the situation and agree that the customers are not receiving safe and adequate service,” Commissioner Daniel Hall said. “I would strongly encourage staff to take the necessary actions to bring this action before the commission.” 

An RDE spokesperson was unable to be reached Wednesday afternoon. 

The commission also approved — but only in part — a motion to compel from Midwest Energy Consumers Group (MECG) as Kansas City Power and Light (KCP&L) Company seeks approval for a special incremental load rate for a steel production facility in Sedalia. Certain requests were denied by the commission as a “fishing expedition” and not relevant to the case. 

An evidentiary hearing has been set for Oct. 17. 

Additionally, the PSC approved a staff report, which included a request for additional information for an ongoing investigation into the self-commit and self-scheduling practices of Missouri’s investor-owned electric utility companies. While commissioners stressed they were not suggesting the utilities are “doing anything inappropriate,” more details regarding economic and unit minimums were requested.

“Based on the information I’ve seen, I don’t understand how utilities are determining that economic minimum, and that is absolutely critical to determine whether or not it’s in the best interest of rate payers,” Hall said. “Additional information as to how they establish that economic minimum is an appropriate line of inquiry.” 

A request from Summit Natural Gas of Missouri, Inc., (SNGMO) for authority to increase the amount of secured debt pledged by its capital stock by an additional $85 million — bringing its total to $310 million — was approved. The company agreed to terms presented by staff, including quarterly reports for all subsidiaries’ retirement of debt. 

The PSC had given the greenlight for SNGMO’s corporate restructuring plan in January. 

The PSC also approved a prudence review for Ameren Missouri’s fuel adjustment clause (FAC) Wednesday. The order, approved unanimously by the commission, found the report to be “reasonable.” 

Commissioners approved Liberty Utilities’ Weather Normalization Adjustment Rider (WNAR) tariff sheet and set an evidentiary hearing for Oct. 2-3 for Spire Missouri’s request to change its infrastructure system replacement surcharge.