Across Missouri, electrical utilities are grappling with ways to modernize the grid, much of which is showing its age.
Tom Byrne, Ameren Missouri’s senior director of regulatory affairs, said some underground electrical infrastructure may not be replaced with modern technology until it reaches 100 years in age if the current pace of replacement continues.
Byrne says the challenge for utilities, which operate as state-regulated monopolies, is how to pay for the infrastructure improvements in a timely manner. He says utilities must seek approval for the rate increases needed for infrastructure and other costs. In Missouri, however, the regulatory approval process can make it years from the time a project is completed until its costs are recovered.
That delay is called regulatory lag, and it was one of the main topics of discussion in Jefferson City last week when utility insiders, regulators and other experts came together at a meeting hosted by the state Public Service Commission to assess what policy levers can be adjusted to improve Missouri’s energy landscape.
To some experts, Tuesday’s summit raised broader questions about what regulators should incentivize the utilities to aim for. Some said a change is needed to give utilities the certainty needed to plan investments for the long run without the constant stop-and-go of backward-looking rate cases.
Read more: St. Louis Post-Dispatch