This is included in a multi-part series
ST. LOUIS, Mo. – Missouri’s energy providers play a big role in the state’s economic development in terms of recruiting and retaining businesses to the state.
Michael Kearney, director of Economic Development at Ameren Missouri; Drew Robinson, manager of Renewables at KCP&L and Brenda Linderer, director of Business Development at Spire, Inc. joined the Midwest Energy Initiative on Wednesday to discuss their roles in providing for Missouri.
“It’s a very exciting time in our industry,” Kearney said. “Based on some of the movements that our state has taken, some of the progressive efforts, I’m quite encouraged about the future of this energy sector and moving towards pure energy future. I’m also, frankly, very positive about Missouri’s ability to beat.”
Kearney said that Ameren is a “vertically integrated utility” while also “aggressively pursuing and transitioning” a cleaner, more diverse portfolio of electric generation. He said there are a number of issues at play including energy being delivered in a bi-directional pattern, great modernization, emerging technologies, being customer-centric and giving customers greater control of their energy.
“This program begins and ends with the customer in mind…customers have choices and we want to be that preferred supplier going forward,” Kearney said. “Critical to this process was the passage of Senate Bill 564, the Ameren Missouri’s Smart Energy Plan, in our state legislature this past spring. Progressive legislation that really positions our entire state, not just Ameren, to move forward into the next future of the electric grid.”
Through SB 564, Kearney said, there is an immediate rate decrease of approximately six percent, about $166 million, to provide the customers with immediate success. Along with the bill is a rate-freeze until April 2020 on Ameren and rate-caps of 2.85 percent on average annually for the next five years. There is also a new $1 billion infrastructure investment for modernization that Ameren plans to begin in 2019 over a five-year period to integrate and modernize new technologies.
“Ameren is connected to the community,” Kearney said. “It is important to get customers to want to expand and invest locally in Missouri by using recurring costs that the customers want to work through. Ameren is part of the equation of customer service moving forward.”
Ameren, KCP&L and Spire are all committed to their communities and bringing the best resources imaginable to their current customers as well as their prospective customers.
“From an energy standpoint…we are taking great strides to deliver a cleaner, cheaper product to our customers,” Robinson said. “The opportunity [is] to use renewables and renewable tariff-offerings, product offerings, as a way to incentivize customers to site in our jurisdiction.”
Robinson said from a company standpoint, when procuring resources of a 20-30 year commitment, it is different to do it for the utility compared to doing it for the customer. When the customer is subscribing to the product and trusting in the services that are being offered, Robinson said it is important to know what the customer wants.
According to Robinson, the customers want economic products, long-term price certainty, de-risked power purchase agreements (PPAs), additionality and simplicity. He said that it is crucial to provide customers with new resources in a place where those resources are being used. Having complex products is not beneficial for the customers or the utility.
“At the end of the day, my job is to make sure that when you subscribe, you fully understand what you’re getting into,” Robinson said. “We are providing educational materials to you so that you can understand what you’re getting into.”
Robinson’s company’s portfolio of renewable products is taking “great strides” to provide to customers now as well as tomorrow. These renewable products will essentially share the benefits while limiting the risks through renewables direct and solar subscriptions; utilize the local resources of Missouri and Kansas wind; use a wind/solar profile versus load profile and de-risk the product through long-term price certainty, congestion, curtailment risk and location.
“My goal is to grow the company, grow Spire,” Linderer said. “But I can’t do that without economic growth as well. I mean, really, I depend on economic development to grow. They’re hand in hand. Yes, I want to add additional customers, but that’s what economic growth is all about too, attracting customers to Missouri.”
Focusing on availability infrastructure, competitive pricing and innovation, Linderer explained what Spire is doing in making natural gas available to consumers who want it at a desirable price in a forward-thinking area. She said that while utilities want those additional customers, it has to make “economic sense” for them to locate or expand their business in Missouri.
Linderer shared a report from the Energy Information Administration which shows that natural gas prices are the lowest they have been since 1976. She said it is important to acknowledge the prices because many customers that are trying to find a place to locate are looking at the prices of gas. According to Linderer, many customers are wanting natural gas, it’s a major attraction for the customers.
“We have an abundant supply of natural gas resources here in the United States. The greater the supply we have access to, the lower the price, and we can keep them competitive,” Linderer said.
Linderer also discussed the Spire STL Pipeline. Starting in Scott County, Il., the STL Pipeline is a 65-mile stretch of pipe that Spire is investing in, which will bring new energy into the St. Louis region while increasing affordability and reliability for the people Spire serves.
“A diverse portfolio in investments and a diverse portfolio in gas supply, that’s what we’re trying to do by this pipeline,” Linderer said. “Building this pipeline is going to give us access to the abundant resources. Not only is this going to keep competitive pricing in our region by offering that diverse portfolio, but it’s also going to create a lot of development opportunities along the pathway.”
As the pipeline is being constructed, Linderer shared that economic development will come into the region through people eating at the restaurants and staying in the hotels. She said the pipeline will also provide the gas and electric utilities and municipalities with new and abundant resources of natural gas to serve future demands.
Along with the STL Pipeline, Linderer said that Spire can leverage natural gas as a tool for economic growth through the abundant supply and low prices as well as rate mechanisms; leverage existing efficiency programs to meet broader economic or environmental policy goals and promote new technologies to improve energy services, lower costs and reduce emission.
Ameren and Spire are both working on an Economic Development Rider which establishes discount rates available to individuals, attracting them to locate to Missouri.
Kearney said this is one of the most progressive economic development incentives being offered by the state in the nation.
“Economic Development Rider allows Spire to negotiate a discount rate to attract larger business to the region or to have an existing business, existing customer, expand in Missouri,” Linderer said. “In order to qualify for this Economic Development Rider, the customer has to receive some sort of incentive for economic development from the state or the local region.”
FEATURED IMAGE/Michael Kearney Brenda Linderer and Drew Robinson/DANIELLE MAE FRANKLIN/CLAYTON TIMES