Republicans in control of the Missouri Senate were in agreement Wednesday that the state needs more nuclear power, but they debated how the construction of those nuclear plants should be paid for.
Last year, Missouri lawmakers passed a bill allowing gas utilities to employ what’s called “construction work in progress” or “CWIP” — a policy that enables energy companies to earn revenue on power plants as they build them and before they generate any electricity.
But senators voted this week to ban the financing mechanism from being used to build nuclear power plants, which often take much longer. The amendment to ban CWIP was attached to a larger energy bill sponsored by Sen. Mike Cierpiot (R-Lee’s Summit), who voted against it.
Senator Joe Nicola (R-Grain Valley) said last year’s massive utility bill that includes CWIP for gas plants will add to Missourians’ electricity bills, and he proposed the amendment to keep that from expanding to nuclear.
“My constituents are suffering. They're complaining about their utility bills and we're down here, just keep adding and piling more,” he said. “I understand we have a generation issue, and I love nuclear but … I would love to find a different way than on the backs of my constituents or the people of Missouri to actually pay for it.”
Opponents of the amendment, including Sen. Curtis Trent (R-Republic), said it will stifle investments in nuclear power in the state.
“The question before us is, do we want to have cheap, available power for Missouri in the 20-, 30-, 40-year time frame from now? Or do we want to just not build anything because we don't have perfect conditions?” Trent said.
Ameren’s Callaway County nuclear facility is the only such plant in the state.
“Nuclear energy will continue to be a vital part of Ameren Missouri’s safe, clean and reliable generation mix now and as we look ahead,” Rob Dixon, Ameren Missouri’s vice president of regulatory and legislative affairs, said in a statement e-mailed to KBIA. “This direction continues to receive strong backing from state leaders, underscoring its significance for Missouri's energy future.”
Cierpiot is chair of the senate committee that handles energy and utility legislation. He said if Missourians pay for power plants up front through their utility bills, it could save them money long-term.
“Instead of rolling all the financing into the future expenses that are being paid for, it pays for them as they roll and that does save money on the consumer going forward,” he said.
Though, Cierpiot noted when the Callaway County nuclear power plant was built decades ago, it ended up costing more than expected.
“Callaway did have some cost overruns, and that was painful. But paying for them as they go, as far as the finance charges that are building up is a long-term save for that asset and for the consumers,” Cierpiot said.
In 1976, Missouri voters approved a ballot initiative banning the use of construction work in progress. Last year the legislature changed that law to allow gas plants to be financed through CWIP.
Missouri Industrial Energy Consumers attorney Diana Plescia represents manufacturers who use large amounts of electricity. She said in other states that allow utilities to build nuclear plants with CWIP, projects often run way over budget or are abandoned — leaving customers with no return on their involuntary investment.
“Under the CWIP law that passed last year, from the second the utility starts putting a shovel in the ground the ratepayers are charged for all of the cost of building that (gas) plant, even if it's not serving them,” Plescia said. "That is really risky because the utility has no incentive to hold its cost down, or very little incentive to hold its cost down on the construction."
Consumers Council of Missouri Executive Director Ed Bryant applauded the amendment to ban CWIP for nuclear power in a press release.
“Ratepayers have been speaking up to their legislators about their high utility bills, and we believe the voices of consumers produced this important victory,” Bryant said.
Nicola voiced his displeasure with how the legislature “overrode” the will of the voters with last year’s bill.
“I don't agree with using my constituents, ratepayers, as a bank for a free interest loan,” Nicola said.
The amendment to ban CWIP for nuclear plants passed by a margin of 1 vote, 14-13. The entire energy bill now awaits a final vote in the Senate.
Just a day before, the Missouri House voted to approved the use of CWIP for nuclear power plants.
