JEFFERSON CITY — Utility provider Ameren Missouri sought approval Thursday for a $264 million rate increase for its electric customers, which could result in an extra $10 a month on a typical residential bill.
With about 1.2 million power customers, Ameren Missouri is the state's largest electric provider. If granted by state regulators, the rate increase would be the sixth in roughly the past eight years for the St. Louis-based utility.
Ameren said about half of the rate increase is due to rising costs for the fuel used to generate electricity. The rate increase also would cover the costs for various improvements, including new equipment at coal-fired and nuclear power plants and new electrical substations in the St. Louis area. A portion of the increase is attributable to solar power investments and customer rebates.
The 9.7 percent rate increase would amount to an extra $10 a month for an average residential customer using 1,100 kilowatt hours of electricity, said Warren Wood, the company's vice president of external affairs and communications.
Although requesting more money from customers, "we're working very hard to keep our rates low by cutting costs wherever we can," Wood said.
Rate increases for investor-owned utilities are subject to approval by the Missouri Public Service Commission through a regulatory process that can take up to 11 months. Consumer advocates, industrial energy users and the commission's staff all will have a chance to weigh in on whether the increase is justified.
The Fair Energy Rate Action Fund said Thursday that it will oppose Ameren's rate increase, which it said would amount to an aggregate 52 percent increase over the past seven years. The rate hike would damage Missouri's families and economy, said Chris Roepe, the group's executive director.
When the PSC approves rate increases, the final figure often is lower than what originally was sought by utilities.
In December 2012, the PSC approved a $260 million rate increase for Ameren Missouri, which amounted to about two-thirds of the $376 million increase originally sought by the company.
Ameren's latest proposed increase comes as its largest customer is spearheading a drive for reduced rates.
Noranda Aluminum Inc., which operates a smelter in New Madrid, is seeking a more than one-quarter percent reduction in its electric rates and suggests Ameren Missouri should offset that lost revenue by charging more to other customers. Separately, Noranda also is pursuing a Public Service Commission case alleging Ameren Missouri is earning more than it's entitled to and that rates in general should be reduced.
Ameren Missouri has argued against both of those cases.
Wood said Ameren Missouri's new filing seeks the same percentage rate increase for Noranda as for the rest of its customers.