Missouri Senate

Senate Substitute

STATE PURCHASING (Section 34.045)

The Commissioner of Administration shall waive the requirement of competitive bids or proposals for the contracting of legal counsel, financial advisors, and other consultants as necessary to effectuate the purposes of a provision of law relating to financing orders for utilities.

RATE ADJUSTMENTS OUTSIDE OF GENERAL RATE PROCEEDINGS(Section 386.266)

Current law allows an electrical corporation to apply to the Public Service Commission to approve rate schedules authorizing periodic rate adjustments outside of general rate proceedings due to changes in customer usage due to weather and conservation or to defer and recover certain depreciation expense and return for qualifying electric plant recorded to plant-in-service on the utility's books, but an electrical corporation cannot elect to do both.

This act repeals provisions limiting electrical corporations to one of the above options.

ACCOUNTING PRACTICES OF PUBLIC UTILITIES (Section 393.1275)

Under this act, electrical corporations, gas corporations, sewer corporations, and water corporations shall defer to a regulatory asset or liability account any difference in state or local property tax expenses actually incurred, and those on which the revenue requirement used to set rates in the corporation's most recently completed general rate proceeding was based. The regulatory asset or liability account balances shall be included in the revenue requirement used to set rates through an amortization over a reasonable period of time in such corporation's subsequent general rate proceedings. Such expenditures deferred under this provision are subject to Commission prudence review in the next general rate proceeding after deferral.

This provision is identical to a provision contained in the perfected SS/SCS/SB 745 (2022) and similar to a provision contained in HCS/HB 1734 (2022).

PLANT-IN-SERVICE ACCOUNTING (Section 393.1400)

This act modifies the definition of "weighted average cost of capital" for a provision relating to plant-in-service accounting.

CAPITAL INVESTMENT PLAN (Section 393.1400)

Current law states that an electrical corporation's election to defer depreciation expense, as set forth in statute, shall allow it to make such deferrals until December 31, 2023, or if approved by the Public Service Commission, continue to make such deferrals from January 1, 2024, through December 31, 2028. Under this act, such deferrals are allowed until December 31, 2033, or if approved by the Commission, a corporation may continue such deferrals from January 1, 2034, through December 31, 2038.

DISCOUNTED ELECTRIC RATES (Section 393.1640)

This act modifies the criteria for electric customers to be considered for a discounted electric rate. The first discount of 35% is for customers with new load that is projected to be between 300 kilowatts but not more than 10 megawatts with a load factor of 45% and shall apply for 5 years. The second discount applies for new load that is projected to be more than 10 megawatts and have a load factor of 55% and the discount percentage shall be determined such that the applicant's total bill is expected to provide revenues equal to 120% of the corporation's variable cost to serve the corporation's accounts that are to receive the discount. Such discount shall apply for 10 years.

In order to obtain one of the discounts, the customer's load shall be incremental, the customer must receive an economic development incentive from the local, regional, state, or federal government, and the customer must meet criteria set forth in the electrical corporation's economic development rider tariff sheet.

The electrical corporation shall verify the customer's incremental demand annually to determine continued qualification for the applicable discount.

In each general rate proceeding concluded after August 28, 2022, the difference in revenues generated by applying the discounted rates and the revenue that would have been generated without such discounts shall not be imputed into the electrical corporation's revenue requirement but instead such revenue requirement shall be set as described in the act.

The sunset date for discounted electric rates is December 31, 2038, and an electrical corporation shall not enter into new contracts for discounted electric rates after December 31, 2033, unless the corporation has timely obtained an order from the PSC relating to deferrals of depreciation expenses.

REVENUE REQUIREMENT (Section 393.1656)

Beginning January 1, 2024, that part of an electrical corporation's retail revenue requirement used to set the electrical corporation's base rates in each of the electrical corporation's general rate proceedings that are concluded on or after August 31, 2023, that consists of revenue requirement arising from inclusion in rate base of certain regulatory asset balances shall not exceed the revenue requirement impact cap, as such term is defined in the act. Such provision shall continue to apply to electrical corporations until December 31, 2033, if the Commission has not issued an order approving continuation of certain deferrals authorized in statute or the continuation of discounted electric rates set forth in statute. However, if the Commission has issued such an order, such provision shall continue until December 31, 2038.

FINANCING ORDERS (Section 393.1700)

The act allows the Public Service Commission to directly contract counsel, financial advisors, or other consultants as necessary to carry out the Commission's duties related to financing orders.

This act is similar to HCS/HB 1734 (2022).

JAMIE ANDREWS