Sen. Nick Schroer (R-Defiance) stepped up to a microphone in a Missouri state capitol hearing room Tuesday to ask his colleagues a question.
"Should Missourians have the right to choose their electricity provider?" he said.
The St. Charles County Republican is pushing a bill that would break up the state's electric monopolies and create a competitive market for energy.
"I believe the answer is yes," Schroer said.
As utility bills rise, lawmakers from both parties are looking for solutions. Schroer's bill is among a few proposals to "deregulate" or "restructure" Missouri's energy system.
If passed, the bills would make Missouri utilities sell their power plants, allowing private companies to enter the market and buy them or build new ones. Eventually, customers could choose a power provider from multiple options.
"For too long, Missourians have lived under a system where they only have one option for electricity, one provider, one rate structure, and very little to say in the matter," Schroer said. "That model may have made sense decades ago, but in today's economy, the current monopoly model limits innovation, suppresses competition and ultimately drives up costs for the very people that we serve."
More than a dozen states allow for a competitive electricity marketplace. In those states, private companies can build power plants and generate energy. Regulated monopolies — companies such as Ameren or Evergy — would still manage the poles and wires that distribute power.
"It's private companies that build the power plants, that maintain them, and if that power is not needed in the future, the rest of the rate payers don't have to pay for that. The risk is on the backs of that private company," said Abby Foster with the Retail Energy Advancement League, an organization that represents electricity suppliers.
As so-called "natural" monopolies, Missouri's investor-owned electric utilities are subject to state oversight in exchange for being the sole provider of service in an area. The Missouri Public Service Commission approves the prices the companies can charge customers and also monitors the system for safety and reliability.
Rep. Tricia Byrnes (R-Wentzville) has proposed electricity deregulation legislation in the house. At a press conference Tuesday she said her constituents' electric bills keep rising, partly due to ineffective state regulation of corporate energy companies.
"Our whole country was founded on taxation without representation. This is still the same thing, only this is in the form of rates," Byrnes said.
Brynes and Schroer said creating a competitive market for electricity could curb price hikes. But utility company staff at Tuesday's hearing disagree.
"When you look at the so-called choice states like in the northeast part of the country — Maine, Massachusetts, New York, Rhode Island, Connecticut — they've all seen residential rate increases at or above the national average, and we do not want to follow their example," said Ameren lobbyist Rob Dixon.
Evergy lobbyist Jason Klindt told lawmakers that commercial and industrial customers do fine in energy markets, but they cause confusion for the average person. He said fraud and consumer protection complaints are higher in states with a power market.
"Your constituents, usually the poor and elderly, will be the ones left to sort through competing claims and offers to try and keep their lights on," Klindt said.
Power company representatives also warn that deregulated energy systems come at the cost of reliability. They reminded lawmakers what happened in Texas during a 2021 winter storm when extreme weather resulted in power outages and soaring electricity bills.
"I can understand why the idea of a utility company competing for customers might sound like a good idea," Dixon said. "However, electric service is not like a consumer product that you buy off the shelf at the store. The grid must be balanced in real time every second of every day, and reliability depends on long term planning for generation and infrastructure."
Many states that restructured their power systems did so in the 1990s in response to consumer frustration over high bills. Byrnes said Missouri lawmakers are in a "great position" to learn from what went well and what didn't.
"I think our plan is one of the best plans because it takes all of the best things from these policies that have been rolled out across the country," she said.
The bill would not impact electric cooperatives and municipal electric utilities.
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