The Empire District Electric Company Files for New Missouri and Oklahoma Electric Rates
The Empire District Electric Company (NYSE:EDE) announced today it has
filed a request with the Missouri Public Service Commission (MPSC) for
changes in rates for its Missouri electric customers. The Company is
seeking an annual increase in base rate revenues of approximately $33.4
million, or about 7.3 percent. If approved by the MPSC, a residential
customer using 1,000 kilowatt hours would see a monthly increase of
about $12.54.
The most significant factor driving the rate request is the cost
associated with the conversion of the Riverton Unit 12 natural gas
combustion turbine to combined cycle operation. The conversion replaces
the production capacity of retiring coal-fired generators at Riverton
and carries a cost of between $165 and $175 million. Scheduled to be
complete in early to mid-2016, the project consists of a new heat
recovery steam generator, steam turbine generator, auxiliary boiler,
cooling tower and other balance of plant equipment. The conversion was
necessary to comply with Mercury Air Toxics Standards (MATS) mandated by
the Environmental Protection Agency.
Other factors in the case include increased transmission expense,
administrative and maintenance expense and costs incurred as a result of
a mandated solar rebate program. The request also reflects cost-savings
for customers resulting from revised depreciation rates and lower
average interest costs.
In the coming months, the MPSC will perform an audit of Empire’s
operations, hold public hearings, and conduct an evidentiary hearing.
Any new rates granted would take effect at the conclusion of this
process, typically in approximately 11 months, or late-summer 2016.
In this same filing, the Company is asking to continue the use of the
Fuel Adjustment Clause (FAC). The FAC provides for semi-annual
adjustments to customers’ bills, based on the varying costs of fuel and
purchased power used to serve customers. The proposed FAC adjustment for
the semi-annual period beginning December 1, 2015, coupled with
adjustments reflected on customers’ bills over the previous 12 months,
will result in a cumulative monthly reduction of $3.46 for a customer
using 1,000 kilowatt hours.
In making the announcement, Brad Beecher, president and CEO, stated,
"The Riverton Combined Cycle Unit was the most economic option to
replace the coal units at Riverton and comply with MATS. This new
configuration captures the exhaust heat from the existing natural gas
unit and uses it to power a new steam turbine. This highly efficient
process will help us hold down fuel costs for customers while lowering
emissions and protecting the environment.”
A corresponding filing will also be made with the Oklahoma Corporation
Commission (OCC) using the Missouri proposed tariffs. An administrative
rule providing rate reciprocity to any electric company who serves less
than ten percent of its total customers within the State of Oklahoma
took effect in August 2015. The rule is intended to provide cost savings
for customers related to rate case expenditures. As a result, future
Commission approved increases in Missouri rates will be effective for
Empire’s Oklahoma customers subject to approval of the OCC.
Based in Joplin, Missouri, The Empire District Electric Company (NYSE:
EDE) is an investor-owned, regulated utility providing electric, natural
gas (through its wholly owned subsidiary The Empire District Gas
Company), and water service, with approximately 218,000 customers in
Missouri, Kansas, Oklahoma, and Arkansas. A subsidiary of the company
provides fiber optic services. For more information regarding Empire,
visit www.empiredistrict.com.
Certain matters discussed in this press release are “forward-looking
statements” intended to qualify for the safe harbor from liability
established by the Private Securities Litigation Reform Act of 1995. Such
statements address future plans, objectives, expectations, and events or
conditions concerning various matters. Actual results in each
case could differ materially from those currently anticipated in such
statements, by reason of the factors noted in our filings with the SEC,
including the most recent Form 10-K and Form 10-Q.
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