Sen. Dave Schatz’s Weekly Column for May 5

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In the final weeks of session, Senate floor time is incredibly valuable. Time is running out as we approach our constitutionally-mandated adjournment at 6:00 p.m., on Friday, May 13 and that means all the bills we are working on are top priorities for someone. This week, the Senate spent all of Tuesday debating three utility-related pieces of legislation. I had serious concerns about all three bills because I know that utility rate hikes impact the middle class and citizens on fixed incomes the hardest. I am not opposed to working with our utility providers to improve service, but I always have to review utility legislation closely to ensure that ratepayers – you and me – are getting a fair deal.

House Bill 2689, also known as the 21st Century Grid Modernization and Security Act, would institute a comprehensive state energy plan (CSEP) and change the way that electric rates are set in the state. Our current system has been in place for decades, but investor-owned utilities would like to move to a performance-based ratemaking system, in which utilities are rewarded for meeting certain goals by being allowed to raise rates. Rewarding improved service sounds good in theory, but it is critical that the upper limits on rate hikes be carefully reviewed so that rates do not spiral out of control and eat into Missourian’s disposable income.

House Bill 1804 would allow certain gas service providers to increase their rates, as long as the amount earned from those increases go to the upkeep, repair and expansion of the infrastructure of the system. The legislature has allowed this type of ratemaking in the past to replace dangerously degraded pipeline but expanding the program could prove costly. In both House Bill 2689 and House Bill 1804, I am concerned about utilities not being as efficient and low-cost as possible in their work because the expenses that utilities incur are ultimately passed on to consumers.

House Bill 1717 was also briefly turned into a water utility bill by a lawmaker who used a “floor substitute” in an attempt to amend the bill into a water utility bill. American Water is seeking this legislation to “decouple” water ratemaking from actual water usage because water-efficient appliances are leading to a decrease in the consumption of water. This is another fine line to walk because we have to ensure that water infrastructure is properly funded, but we also cannot punish consumers for being more efficient in their water usage.

All three of these bills failed passage on Tuesday but I expect to see them again in the future. I am hopeful work can continue on these bills that will minimize any negative impact on consumers. We all rely on electricity, water, and many of us rely on gas for heat and cooking. These utilities are part of our everyday lives and any change in the way we regulate utilities must be carefully considered.

Thank you for reading this weekly column. Please contact my office at (573) 751-3678 if you have any questions.