Regulators approve AmerenUE rate increase

JEFFFERSON CITY, Mo. (AP) -- State regulators on Friday approved a $226 million rate increase for electric customers of Missouri's largest utility, a change that means most residential customers will likely pay an estimated $9 more on their monthly bills.

The new rates for AmerenUE are likely to take effect in late June. The rate increase is the utility's third in roughly three years.

AmerenUE initially sought a $402 million rate increase. The utility serves about 1.2 million customers, mainly in eastern and central Missouri.

Regulators considered the requested utility increase for the last 10 months and approved it 4-1. Commission Chairman Robert Clayton was the lone dissenting vote and said in an interview that he disagreed with some elements within the rate decision, including the final dollar amount.

Michael West, the manager of communications for AmerenUE, said the Public Service Commission's rate order is lengthy and the utility is reviewing it.

"We respect the PSC's decision, but currently, we're still analyzing and assessing the full order at this point," West said.

The Public Service Commission said that much of the rate increase is because of higher costs for the fuel that AmerenUE uses to run its power plants and for spending on new infrastructure. Regulators lowered the return on equity AmerenUE is allowed to earn from 10.6 percent -- which was approved last year -- to 10. 1 percent. The utility wanted its return on equity to be sent at 11.5 percent.

AmerenUE also is required to spend $1 million for a new pilot program to help low-income customers.

In January 2009, the Public Service Commission approved a $163 million rate increase for AmerenUE. In 2007, Ameren was granted a $43 million increase, which was a fraction of the $361 million it requested then.