Environmental groups accuse utilities of dodging Missouri renewable energy standards

Monday, February 11, 2013 | 6:00 a.m. CST; updated 2:47 p.m. CST, Wednesday, February 13, 2013
The graphs show the total electricity production capacity breakdown by fuel type in 2011 for three of Missouri’s biggest energy providers: Empire District Electric Co., Kansas City Power & Light and Ameren Missouri. Utilities do not always produce energy at full capacity. If each company was generating and purchasing electricity at full capacity in 2011, the following percentages of energy would come from each type of fuel. The maps show the areas each of the companies service in Missouri.

Missouri environmental groups and alternative energy providers are accusing the state's major utilities of violating its renewable energy requirements.

But because of legal technicalities, the utilities might be staying within the letter of the law, even though the Department of Natural Resources has said their actions are not consistent with the intended outcome of the requirements.  

Making sense of the debate

Renew Missouri and other renewable energy advocates are engaged in a legal battle with Ameren Missouri, Empire District Electric Co. and Kansas City Power & Light. Renew Missouri has accused the utilities of not adhering to the state's renewable energy standards, passed in 2008.

Two technical terms, one in the statute's text and one in the Missouri Department of Natural Resources's rules, have become crucial to determining whether the utilities are adhering to the renewable energy standards.

Renewable energy credits: The first term deals with crediting utilities for extra renewable energy they have generated, in the form of "renewable energy credits." 

The statute defines a renewable energy credit as "a tradeable certificate of proof that one megawatt-hour of electricity has been generated from renewable energy sources" and states "an unused credit may exist for up to three years from the date of its creation."

All three utilities purchase power from out-of-state wind farms. Ameren and Kansas City Power & Light say the power these farms generated that was sold to Missourians before 2011 should count towards the 2 percent requirement for that year.

“The renewable energy standard rules say you can bank for three years. 2011 is the first year we had to comply with the percent requirement, so we started banking in 2008,” Ameren vice president of legislative and regulatory affairs Warren Wood said.

"This would be similar to claiming you have rollover cell phone minutes from before you ever had the phone,” Renew Missouri director PJ Wilson said in a Jan. 30 news release.

Qualifying hydropower: The second term is the definition of hydropower that qualifies as renewable energy. The Department of Natural Resources rule defines qualifying hydropower as:

"Hydropower, not including pumped storage, that does not require a new diversion or impoundment of water and that each generator has a nameplate rating of 10 megawatts (10 MW) or less." 

Ameren and Empire say their 100-year-old hydroelectric plants, Keokuk and Ozark Beach, satisfy the requirements. Both plants contain individual generators below the 10 MW limit, though the aggregate plant capacities are much larger. 

 “Nameplate capacity is well understood in the industry to be the generating capacity on the nameplate of the device,” Wood said.

A bill under consideration in the Missouri House would change the department’s requirements to include hydropower of any size. Rep. Bart Korman, R-42, is sponsoring the bill, which passed the House Rules Committee on Feb. 4.

Related Media

Renew Missouri and seven other environmental advocacy and green energy groups filed complaints with the Missouri Public Service Commission on Jan. 30 and Jan. 31. The complaints accused Ameren Missouri, Empire District Electric Co. and Kansas City Power & Light of not complying with the standards. 

Ameren provides electricity to 3,890 customers in Boone County. Empire and Kansas City Power & Light have no customers in Boone County.

In 2008, Renew Missouri wrote the ballot language for the renewable energy standards. Known to voters as Proposition C, the standards require investor-owned utilities in Missouri to use renewable resources to generate an increasing percentage of the electricity they deliver to their customers. Utilities can also purchase renewable power that they don’t generate themselves.

The state law requires the following percentages of power to be generated using renewable resources:

  • 2 percent by 2011
  • 5 percent by 2014
  • 10 percent by 2018
  • 15 percent by 2021

It also mandates that utilities may not raise their electric rates more than 1 percent.

The Missouri Department of Natural Resources then came up with rules defining which renewable resources count.

Renew Missouri thought that when Missouri voters chose to implement mandatory renewable energy standards in 2008, the utilities would have to get busy building new solar panels, wind farms, landfill gas plants or other environmentally friendly ways to generate energy that would satisfy the requirements.

“I thought my job was done on Nov. 4, 2008,” Renew Missouri director PJ Wilson said, referring to the day when 66 percent of Missouri voters passed the renewable energy requirements.

“Now here we are, five years later,” he said.

In April 2012, the three utilities submitted plans to the Public Service Commission describing how they complied with the standards in 2011, the first year the standards took effect. 

"We are fully compliant," Ameren vice president of legislative and regulatory affairs Warren Wood said.

"Empire has and will continue to meet the requirements of the renewable energy standards in both Missouri and Kansas per state statutes," Empire corporate communications director Amy Bass said.

Kansas City Power & Light supported the standards from the outset, the utility's spokeswoman, Courtney Hughley, said.

"We are in compliance with the rule," Hughley said.

In a response to each of the utilities’ 2011 compliance reports, the Natural Resources Department expressed disappointment in the standards' failure to spark new investment in renewable energy.

“In passing Proposition C, Missouri voters communicated their interest in more renewable energy than had been previously developed in Missouri by 2008,” Department of Natural Resources attorney Jennifer Frazier wrote in response to Ameren’s compliance plan. “This first set of filings demonstrates that Missouri’s renewable energy standard is not creating significant additional renewable energy development.”

“There is no basis to believe that Missouri voters voted for ‘more renewable energy,’” Ameren attorney Wendy Tatro wrote in response the Department of Natural Resources comments. The renewable energy standard "does not require any utility to add any amount of new renewable energy. It only sets forth the percentage of energy generation" or an associated level of renewable energy credits "which must come from renewable energy sources.”

Empire and Kansas City Power & Light did not respond to the department's statement.

So far, only Ameren has built new green infrastructure in Missouri. The company placed photovoltaic solar panels on its headquarters buildings. All of that energy is consumed at the site.

In May 2012, Ameren completed a small facility in Maryland Heights that converts landfill gas to electricity. 

All three utilities offer rebates to their customers who install solar panels on their homes or businesses.  

Wilson said these represent tiny fractions of the utilities' total energy sources and they shouldn't be held up as examples of commitment to developing renewable energy. 

"It’s offensive, really, for them to say, ‘Look at all the stuff we’re doing,’ because the stuff they're doing is a far cry from where they're required by law to be," Wilson said. 

So far, the Public Service Commission has not challenged that the three utilities are in compliance with the standards. Renew Missouri responded with a formal complaint.

The utilities have 30 days to respond to the complaints, the commission's director of regulatory review Cherlyn Voss said. She said the commission could take a wide variety of actions, depending on the complainants’ desires and the utilities’ responses.

“The complainants choose which avenues to take,” Voss said.

Wilson said if the commission decided against them, Renew Missouri would take their complaints to the Missouri Court of Appeals.  

Supervising editor is John Schneller.

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