Missouri Public Service Commission: Ensuring Utility Oversight

1. The State of Missouri Public Service Commission (MPSC) An Overview

2. We are the State of Missouri’s utility regulatory agency.

3. Overview • Created by the State General Assembly in 1913. • Regulate over 1000 utilities who provide electric, gas, telecommunication, water, and sewer services to over 5 million residents. • Approximately 200 staff members and five Commissioners.

4. Overview (continued) • Funded through assessments of investor-owned utilities (IOUs) based on their gross operating revenue in Missouri. • Fiscal year runs from July 1 to June 30. • FY 2006 appropriation: $13.77M and 194.5 full-time employees (FTE).

5. Overview (continued) • Five Commissioners are appointed by the Governor in staggered, six-year terms. • Staff consist of experts in fields of law, engineering, accounting, economics, finance, business and public administration.

6. The Commissioners Jeff Davis, Chair Connie Murray Steve Gaw Robert M. Clayton, III Linward “Lin” Appling

7. Our Mission • …ensure Missouri consumers receive safe, adequate, efficient and affordable services while allowing utility companies an opportunity to earn a reasonable return on their investment. • The Commission and its staff are dedicated to fulfilling these public interest goals.

8. Delicate Balance • MPSC must assure safe, adequate, reliable utility service at just and reasonable rates… AND • Provide utility shareholders an opportunity to earn a reasonable return on their investments.

9. MPSC Regulates Investor-owned Utilities Electric Natural gas Telecommunication Water and sewer services Manufactured Housing

10. Electric • Four regulated electric utilities (AmerenUE, Aquila, Empire District Electric, Kansas City Power & Light). • Serving nearly 2 million customers. • More than 50% of those customers are served by AmerenUE. • Electric operating revenues of more than $3 billion (US) in 2003.

11. Natural Gas • Seven regulated gas utilities (AmerenUE, Aquila, Atmos, Fidelity, Laclede, Missouri Gas Energy, Southern Missouri Gas). • Serving nearly 1.5 million customers. • Over 80% served by Laclede and Missouri Gas Energy. • Gas operating revenues totaled more than $1.4 billion in 2003.

12. Telecommunication • More than 3 million phone lines in Missouri. • 88 Competitive Local Exchange Companies. • 43 Local Telephone Companies • 495 Interexchange Companies • 298 Private Pay Phone Providers

13. Water & Sewer • Mostly small companies, ranging in size from 20 to 1,500 customers. • More than 90% of water customers are served by Missouri-American Water Company. • Approximately 13,000 sewer customers served by 58 companies.

14. Manufactured Housing • Registered/regulated manufacturers: 176 • Registered/regulated dealers: 330 • Manufactured Housing inspectors performed approximately 300 inspections instigated by Consumer Complaints in 2004.

15. Facts Regarding Missouri Utilities • Missouri’s investor-owned electric utilities ARE NOT “deregulated”. • The MPSC DOES NOT regulate the price of wholesale natural gas. • The 1996 Telecommunications Act attempts to encourage competition within the industry. • There are no federal laws governing water and sewer rates.

16. Electric

17. Electric Issues • Rate cases. • Mergers. • Monitoring federal government (FERC) activities. • Utility preparedness.

18. Electric Industry • Planning -- MPSC meets with companies twice a year to discuss issues related to demand, growth, available supplies, and resource planning. • Monitor Trends -- Some states have restructured their retail electric markets, but results have not always helped consumers (e.g., California and Montana).

19. Electric - Federal Activities • NARUC Electricity Committee. • FERC Notices and Interventions. • Regional Transmission Pricing. • Transmission Congestion Management and Pricing. • NARUC Energy and Environment Staff Subcommittee. • Work on Standard Market Design (SMD) Policy.

20. Natural Gas

21. Natural Gas Issues • Gas price hikes. • Review of Purchased Gas Adjustment (PGA) clauses for all Local Distribution Companies. • Energy assistance funding. • Consumer alert programs. • Intervention at FERC.

22. Gas - Federal Activities • Monitor/Intervene/Participate in natural gas pipeline certificate, rate, and tariff cases before FERC. • Monitor/Comment/Participate in FERC gas policy and rulemaking proceedings. • Monitor natural gas industry developments on the national level. • Provide technical support in cases or projects.

23. Telecommunication

24. Telecommunication Issues • Monitoring local telephone competition service. • Revising service and billing practices. • Monitoring federal telecommunications activities (FCC). • Arbitration of interconnection agreements.

25. Telecommunication Fact Since the MPSC first authorized local exchange telephone competition in 1997, a total of 90 companies have been authorized by the MPSC to provide telecommunications service in competition with the traditional incumbent local exchange carrier.

26. MPSC Helping Consumers • Consumer Services staff assist with problems. • Investigate service and billing disputes. • Investigate, enforce, and monitor utility safety issues. • Consumer contact through website or State-wide, Toll-free Consumer Hotline: 1-800-392-4211. • Saved or recovered more than $1 million over last 5 years.

28. Questions? Visit the MPSC web at: http://psc.mo.gov Or email the MPSC at: pscinfo@psc.mo.gov