SCS SB 387 -- RECOVERY OF COSTS BY CERTAIN ELECTRICAL
CORPORATIONS

This bill authorizes the Missouri Public Service Commission to
allow electrical corporations which are not also gas
corporations, which serve fewer than 175,000 retail customers in
Missouri, and which own at least 60% of a plant with a capacity
of at least 300 megawatts which was under construction and at
least 30% complete on January 1, 2001 (currently includes Empire
District Electric Company), to recover reasonably and prudently
incurred costs of the purchase of natural gas used in the
production of electricity and costs of electricity purchased as
an alternative to using the plants and impacted by the cost of
natural gas.  The recovery of purchased electricity costs will
be fully recoverable for one year after the bill becomes
effective and limited to 50% thereafter, and the electrical
corporation must clearly document the impact of the cost of
natural gas on the purchase price of the electric energy.  The
recovery will be according to rate schedules approved by the
commission.

The rate schedules will be initially established pursuant to a
general ratemaking order but will not be established if the
commission determines that it would not be in the long-term,
best interests of ratepayers to establish such a mechanism.

The electrical corporation will file updated schedules every 6
months, even if no change is sought, unless the schedules have
been replaced by a general rate order within the last 6 months.
Updated schedules will be reviewed separately from the general
ratemaking process and decided upon within 45 days, unless the
commission determines an extra period of up to 30 days is
required.  If, in reviewing the update filing, the commission
finds a substantial possibility that the utility is
over-earning, the commission will initiate a general rate order
proceeding.  That rate proceeding will be completed in 11
months, and any rate decrease will be retroactive with interest
calculated from the date that interim cost recovery was allowed
under the bill.  The commission will establish a process to
"true-up" the recovery to refund any over-collection based upon
the adjustments authorized pursuant to the bill, with interest.
A utility will not be allowed to make up for under-collection in
previous adjustment periods.  Once determined, refunds will be
processed in the next billing cycle.  Refund cases will be
considered on an expedited basis.  The Public Counsel and any
customer may intervene.

A utility which files under the bill within 90 days of the
effective date may request, at the time of filing, that
emergency rate schedules be established under the expedited 45--
day process without waiting for the conclusion of the general
ratemaking order.  These requests will follow the same process
used for update filings and will only be allowed if the natural
gas price has changed by more than 25% since the corporation's
latest rate case.

The provisions allowing cost recovery for electrical
corporations terminate on December 31, 2004.

The bill allows any nonprofit electrical corporation to recover
and pass through its costs associated with the purchase and
transportation of electrical energy under an automatic
adjustment provision.

The bill contains an emergency clause.

Missouri House of Representatives
Last Updated November 26, 2001 at 11:47 am