Spire Missouri files rate case to recover infrastructure and technology investments

Rhea-AI Summary

Spire Missouri has filed a rate case with the Missouri Public Service Commission to recover investments in infrastructure and technology. The company seeks to increase delivery charges, with average residential monthly bills expected to rise by approximately $17 (16%) next fall. Despite this increase, overall customer bills are projected to remain lower or unchanged compared to 2024 due to decreased natural gas costs. The company has invested nearly $1 billion in modernizing service infrastructure, contributing to 37 economic development projects worth $3.7 billion and creating over 4,000 jobs in Missouri. The filing also aims to unify Spire Missouri's service territory for consistent statewide rates.

Positive

• Infrastructure modernization investment of $1 billion improving safety and reducing emissions
• Contribution to 37 economic development projects worth $3.7 billion
• Creation of over 4,000 jobs in Missouri
• Lower overall customer bills expected due to decreased natural gas costs
• Implementation of advanced metering technology enhancing safety and usage insights

Negative

• 16% increase ($17) in average residential monthly delivery charges
• Impact of inflation and higher interest rates on operational costs

Insights

Utility Industry Analyst

This rate case filing represents a significant financial development for Spire Missouri. The requested $17 monthly increase (16%) in delivery charges reflects substantial infrastructure investments of nearly $1 billion. The timing aligns with industry trends of utilities seeking cost recovery for modernization efforts.

The proposal's structure is noteworthy for two key aspects: 1) The consolidation of service territories to streamline operations and standardize rates statewide and 2) The inclusion of a weather/conservation adjustment mechanism to stabilize revenues. While the rate increase appears substantial, the company's strategic positioning of lower natural gas commodity costs helps offset the impact on total customer bills.

The economic development impact is significant, with 37 projects worth $3.7 billion and 4,000 new jobs, demonstrating the utility's role in regional growth. The advanced metering implementation suggests improved operational efficiency and customer service capabilities ahead.

ST. LOUIS, Nov. 26, 2024 /PRNewswire/ -- Late yesterday, Spire Missouri filed a rate case with the Missouri Public Service Commission (PSC) to recover infrastructure and technology upgrade investments made to better serve customers.

"We're committed to safely delivering reliable and efficient natural gas service to more than 1.2 million homes and businesses in Missouri and doing so in the most affordable way for our customers," said Steve Mills, Spire Missouri president. "We want our customers to know that even with this request, they will see bills that are slightly lower or unchanged compared to 2024."

A customer bill is largely made up of two components – Spire's delivery charge and the cost of the natural gas itself. While the delivery charge portion of a customer's bill – which covers the cost of the service Spire provides to safely deliver natural gas to a home or business – is expected to increase under Spire's request, the cost of natural gas seen on customer bills has decreased significantly compared to 2024. Including this decrease to natural gas costs, when new delivery rates take effect in Fall 2025, overall customer bills are expected to be lower or unchanged compared to the last year, assuming current natural gas market conditions.

What is Spire requesting?

During rate cases, the PSC examines the value of services customers have received from their utilities and establishes rates based on already incurred costs. A typical timeframe of rate case approval with the PSC is eleven months from the time of filing.

Should Spire's request be approved by the PSC, the average residential monthly bill for customers across Missouri are expected to increase next fall by approximately $17, or roughly 16%, compared to current rates, assuming current natural gas market conditions.

Since its last rate case was completed in 2022, Spire has continued to make investments in its delivery system and technology to benefit customers. For example:

• Spire has invested nearly $1 billion to maintain and modernize service infrastructure, in turn reducing emissions and improving the safety of its distribution system.
• New infrastructure means lower maintenance costs and improved reliability and service for years to come. It will also ensure that Missouri has the advanced energy infrastructure to fuel economic growth and job creation.
• During FY24, Spire was part of securing 37 publicly announced economic development wins in Missouri, representing an investment of nearly $3.7 billion in the state economy and resulting in the creation of more than 4,000 jobs. Access to natural gas played a key role in securing many of these projects.
• Spire continues the rollout of advanced metering technology for its customers across Missouri. The upgrade offers both enhanced safety features and, once fully implemented, improved insights into monthly energy usage.

The filing addresses increased costs experienced in recent years as Spire was not immune to impacts from inflation and higher interest rates that impacted consumers and businesses across the country.

With this filing, Spire hopes to create one Spire Missouri service territory, providing customers consistent rates across the state and a streamlining of operations, ultimately translating to efficiencies for customers and for Spire. Spire is also requesting an improved mechanism to mitigate the impacts of changes in weather and the effects of conservation on customer usage, as allowed under Missouri law.

For more information, visit spireenergy.com/rate-case.

About Spire

At Spire Inc. (NYSE: SR) we believe energy exists to help make people's lives better. It's a simple idea, but one that's at the heart of our company. Every day we serve 1.7 million homes and businesses making us one of the largest publicly traded natural gas companies in the country. We help families and business owners fuel their daily lives through our gas utilities serving Alabama, Mississippi and Missouri. Our natural gas-related businesses include Spire Marketing and Spire Midstream. We are committed to transforming our business through growing organically, investing in infrastructure, and advancing through innovation. Learn more at SpireEnergy.com.

Investor Contact:
Megan L. McPhail
314-309-6563
Megan.McPhail@SpireEnergy.com 

Media Contact:
Jason Merrill
314-342-3300
Jason.Merrill@SpireEnergy.com

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SOURCE Spire Inc.

FAQ

How much will Spire Missouri's rate increase affect monthly residential bills?

Spire Missouri's rate increase is expected to raise average residential monthly bills by approximately $17, or 16%, compared to current rates, effective Fall 2025.

How much has Spire Missouri invested in infrastructure modernization?

Spire Missouri has invested nearly $1 billion to maintain and modernize service infrastructure, improving safety and reducing emissions.

When will Spire Missouri's new rates take effect?

The new rates are expected to take effect in Fall 2025, following an eleven-month PSC review period.

How many jobs did Spire Missouri's economic development projects create?

Spire Missouri's involvement in 37 economic development projects resulted in the creation of more than 4,000 jobs in Missouri.