Environmental and consumer advocate groups, individuals and even the city of Kansas City are pushing back against a proposed double-digit rate hike by Missouri’s largest natural gas utility.
Spire, which serves almost 1.2 million customers in Missouri, hopes to boost its natural gas rates to bring in $152 million. It needs approval from the Missouri Public Service Commission.
The rate increase would come to about 10.4% for eastern Missouri customers, about $8.19 a month, and 12.7% for western Missouri customers, or about $11 a month.
Following the economic crisis brought on by the COVID-19 pandemic and inflation unlike anything seen in decades, the proposed hike is being decried by consumers. And state regulators and consumer advocates are skeptical Spire needs to increase rates by so much.
“Kansas City has an affordability problem. Be a part of the solution and reject this proposal,” said Reese Bentzinger, who was among the dozens who showed up to a public hearing in Kansas City to ask the Missouri Public Service Commission to reject the rate increase.
Jason Merrill, a spokesman for Spire, said the company was mindful of customers who may be struggling and said the utility offers programs and assistance.
Monopoly utilities, like Spire, typically file rate cases every few years to recoup costs already invested in infrastructure, like pipelines and meters. Spire was already approved for a rate hike just 11 months ago of nearly 3%.
In testimony with the Public Service Commission, the company said it’s not receiving as much in revenues from customers as its spending on overhead. The company also said at the public hearing in Kansas City that it’s now receiving as large of a profit margin as other Missouri utilities.
But staff of the Missouri Public Service Commission, who make recommendations to the commissioners, recommended Spire be allowed to recoup $70.7 million — less than half of the $152 million the company requested.
Merrill said that’s simply part of the process.
“Our teams are meeting with regulators and intervenors in the case to reach a conclusion on this,” he said.
The rate hike comes on top of already high gas prices, which aren’t factored into customers’ base rate. Spire passes the cost of gas through to customers with no mark-up and it fluctuates more frequently than the rest of their bill.
Gas prices have been on the rise since mid 2020, according to the Energy Information Administration. And Spire passed on an increase of more than 40% to Kansas City customers and 20% to St. Louis customers late last year.
Mary Esselman, CEO of Operation Breakthough, which assists children and families in poverty, said many of the families her organization serves live in housing that isn’t energy efficient and pay hundreds of dollars for gas every month. A 10% increase for those families could mean an extra $40 or more a month on their bill.
“This is not,” she said, “the appropriate time for rate increase and it does not appear just and reasonable.”
This story was originally published on the Missouri Independent.
