The state’s ratepayer advocate rejected an earlier plan for spending too much without delivering enough benefits.
Missouri’s largest utility has reached an agreement with ratepayer and clean energy advocates on a scaled back energy efficiency plan.
Ameren Missouri faced criticism this summer for proposing a six-year, $550 million conservation program that critics said didn’t deliver enough benefits to customers.
The modified plan, submitted last week to state regulators, calls for spending $227 million over three years, a 16 percent increase compared to the budget of its current three-year program.
Geoff Marke, chief economist with the Missouri Office of Public Counsel, called the compromise “a reasonable path forward. I do think it’s better than what was initially proposed.”
Marke objected to the scale of the initial vision, and the fact that it would not have saved ratepayers from the cost of new generation until at least 2034. In the face of stagnant demand for electricity, Ameren has more than enough generation capacity for years to come.
The new benefits, which would take effect in February 2019, actually decreases spending for residential programs by 17 percent but increases projected energy savings by 40 percent to 800,000 MWh over three years.
“We feel that is very significant,” said Andrew Linhares, an attorney with Renew Missouri, a nonprofit that advocates for clean energy and took part in negotiations.
The plan includes some significant additions, most notably $20 million in benefits aimed at low-income households in single-family homes.Although most of the program’s features will run for three years, benefits for low-income customers would continue for six years.
“These are intended to get to folks in the market who are tenants in rental housing and haven’t had access to energy efficiency programs in the past,” Linhares said. “We think that’s very positive.”
The plan also offers new demand response options for commercial and residential customers. Ameren would compensate customers who allow the utility to cut back on power delivery at times of peak demand. When stretched to the limit by demand, utilities turn to generation sources that they may use for just a few very costly hours per year.
Marke said the program, unlike the previous proposal, will offer benefits to customers across the board. Any efficiency measures that lower the peak demand will cut costs for all customers, he said. Any customer who insulates a building or who purchases a heat pump will help to reduce peak demand on the grid. And that, he said, “should translate into savings not just for that household, but for all customers.”
The Missouri Public Service Commission is expected to make a decision within the next few weeks.