Ameren, critics spar over who's to blame for lost last-minute deal
This article first appeared in the St. Louis Beacon, May 24, 2011 - Less than an hour before Missouri's legislative session was to end at 6 p.m. on May 13, the state Capitol was abuzz with news of a last-minute deal between electrical-utility giant Ameren Missouri and the Fair Energy Rate Action Fund, or FERAF, a coalition of large companies and organizations that has opposed the utility's effort to change state law so it can charge consumers some of the costs for a proposed nuclear plant before it is built.
The agreement resulted in an 11th-hour new bill. But in that last hour, the state Senate quickly put the brakes on any hopes for an 11th-hour vote. Senate Minority Victor Callahan, D-Independence, held up the document, declaring "I have no idea what this is a 46-page mystery."
Minutes later, the Senate adjourned for the year.
Now, almost two weeks later, mystery surrounds the subsequent fallout between Ameren and FERAF -- with the latter e-mailing disparaging releases about the utility almost daily.
Chris Roepe, FERAF's director, said the frequent missives are aimed at making it clear to other political players that FERAF's coalition of companies -- including Anheuser-Busch and Noranda Aluminum -- weren't responsible for the deal's demise, as some plant backers have alleged.
"I'm not sure what changed," Roepe said.
Initial pleas for Gov. Jay Nixon to call a special session to rescue the pro-nuclear plant effort appear to be diminishing, particularly since the governor has made clear that a deal needs to be in place before -- not after -- he would reconvene the legislature.
In the meantime, Ameren and FERAF also are offering dramatically different accounts of their short-lived agreement.
In response to the Beacon's query, Ameren issued a statement this morning laying out its current position:
"Missouri's electric service providers (cooperative, municipal and investor-owned) have all identified nuclear power as an important low-cost and reliable energy option for Missouri's energy future. Furthermore, we believe that the best step to maintain this option is to obtain an early site permit. We must ensure any legislation also creates jobs, strengthens our economy and competitiveness, and keeps rates affordable for our customers long term."
But as for that last-minute agreement, Ameren cast itself as a reluctant partner. "The alliance expressed concerns regarding the legislation that went to the floor May 13. But in the interest of cooperation, we did not stand in the way of this legislation going up for debate."
Since then, says Ameren, "The alliance has discussed next steps in light of this legislation not passing, despite broad bipartisan support in both chambers and the support of Gov. Jay Nixon, Lt. Gov. (Peter) Kinder, labor, and hundreds of businesses and people from all corners of Missouri. At this point, we have not taken a position on a special session or if we would pursue similar legislation next session."
FERAF, meanwhile, has accused Ameren of double-speak.
"Has Ameren read their own bill?" asked the group in its latest release.
Roepe takes issue with a recent public statement by Richard Mark, senior vice president of consumer operation for Ameren Missouri, that the utility backed out of the agreement because " 'the deal could have resulted in significant rate increases for residential customers.' "
Roepe said that's why Ameren and its allied utilities sought the bill in the first place. The reason for the measure, he noted, was to persuade the General Assembly to change the 35-year-old state law -- put in place by initiative petititon -- that bars utilities from charging customers for power plant construction before they're in operation.
"Ameren and their coalition have, for the entire legislative session, promoted legislation to allow them to bill ratepayers for the cost of their early site permit (ESP)," Roepe said. "Their initial proposals would have raised rates on customers over $100 million, and the compromise they agreed to the last day of session would have allowed them to raise rates by $45 million."
"Since the purpose of the ESP legislation Ameren introduced was to allow Ameren to raise rates, it is quite obvious to all that this is not the reason they are backing out of the agreement," FERAF concluded in a statement.
Another critic, the Missouri Coalition for the Environment -- which was not part of the compromise -- points to a provision in the now-scuttled agreement that earmarked more money for the Office of Public Counsel, the state agency that represents consumers in dealings before the Missouri Public Service Commission, which regulates utility rates and services.
"I think the Office of Public Counsel funding had everything to do with it,'' said Ed Smith, who has been the coalition's coordinator for its effort to oppose any change in the 1976 law. Smith believes that the utility didn't want to beef up state oversight of its actions and dropped its support as a result.
In any case, Smith added, "I am happy to see that Ameren and FERAF are backpedaling hard."
Smith and Roepe emphasized that Ameren Missouri could go ahead and, without any law changes, obtain a permit and build a new nuclear plant. The only reason to involve the legislature, both added, was to change the state law so that consumers could foot the early expenses, not Ameren or its stockholders.
In any case, Roepe said that FERAF still supports the now-scuttled agreement, and backs efforts by some -- most notably state Rep. Mike Kehoe, R-Jefferson City -- to seek a special session.
"We are willing to give Ameren $45 million in exchange for the right consumer protections,'' Roepe said. "Now they have backed out, and that's where we're at."