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HB 2122

Allows electrical corporations to charge for services based on the costs of certain construction work in progress

2026 Regular Session Introduced by John Black and 2 co-sponsors

Missouri bill lets utilities recover CWIP in rate base for select new plants (gas units and nuclear ≤600 MW) under PSC oversight with refunds if costs are imprudent or delayed.

Third Read and Passed (H)
#energy #utilities
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WeVote Research Nonpartisan
Bill Summary · HB 2122

Summary — HB 2122 (Missouri version): Allows electrical corporations to recover costs for certain construction work in progress

Status: Introduced (multiple versions in packet). Subject: Energy / Utilities.
This summary focuses on the Missouri-text provisions in the packet that amend section 393.135 and add section 393.1250 (titled the “Missouri Nuclear Clean Power Act”).

Main purpose

To create a limited exception to Missouri’s longstanding prohibition on including construction work in progress (CWIP) in utility rate base by allowing electrical corporations to include CWIP for certain new generating projects (notably small nuclear “clean baseload” plants) so the utility can recover costs and earn a return during construction rather than receiving only the traditional allowance for funds used during construction (AFUDC).

Key provisions

  • Revises current law that generally prohibits charging customers for costs based on CWIP, by adding express, limited authorizations for inclusion of CWIP in rate base.
  • Two distinct authorizations:
    • (Existing-appearing) Permits CWIP inclusion for a new natural gas generating unit subject to limitations (amount limited to estimated project cost and expenditures within the estimated construction period); inclusion replaces any AFUDC that would otherwise have accrued once new base rates reflecting CWIP inclusion take effect.
    • (New section 393.1250 — “Missouri Nuclear Clean Power Act”) Permits electrical corporations to include CWIP for new clean baseload generating plants (defined as new nuclear-fueled facilities ≤600 MW intended to serve retail customers).
  • CWIP must be recorded according to the FERC Uniform System of Accounts (or equivalent account used for CWIP).
  • The Public Service Commission (PSC) determines, in a rate proceeding under §393.170, the amount of CWIP that may be included in rate base.
  • Base-rate recoveries from CWIP inclusion are subject to refund (with interest at the same rate used for delinquent taxes under §32.065) if the PSC later finds costs were imprudently incurred or the project was not placed in service within a “reasonable amount of time.”
  • Rate base offsets: return deferred under §393.1400 and other offsets apply so customers are not charged twice for the same base-rate return.
  • Expiration/Review:
    • Authorization for gas-generation CWIP inclusion (as drafted) expires December 31, 2035 unless, after a 2035 hearing and showing of good cause, the PSC extends it through December 31, 2045.
    • The Nuclear Clean Power Act CWIP authorization expires December 31, 2036 unless extended after a 2036 hearing through December 31, 2046.
  • PSC rulemaking authority to implement the Nuclear Clean Power Act, with a nonseverability clause tying that authority to statutory rulemaking review (chapter 536).

Who would be affected

  • Electrical corporations (investor-owned utilities) proposing qualifying new generation (small nuclear and certain natural-gas units) could recover a portion of construction costs through rates before plant is in service.
  • Retail ratepayers could see earlier rate impacts (rate increases phased in during construction) compared with recovery only after in-service.
  • The PSC (regulator) gains explicit authority and a procedural framework to approve and oversee CWIP recovery.

Procedural/timeline aspects

  • Inclusion of CWIP occurs only after PSC review in a §393.170 rate proceeding.
  • Refund and prudence reviews can occur in subsequent complaints or general rate proceedings; interest on refunds set per §32.065.
  • Temporary authorizations with statutory expiration (2035 / 2036) requiring hearings to extend to 2045 / 2046.

Potential impacts (practical considerations)

  • Utilities: Lower financing costs and earlier cash flow during construction; reduced reliance on AFUDC.
  • Ratepayers: Potentially higher bills during construction (shifts some construction financing risk to customers), but statutory safeguards (prudence reviews, refund with interest, offsets) are included.
  • Regulators: Increased oversight burden to set appropriate CWIP amounts, monitor project prudence and timeliness, and adjudicate refund claims.

Note: The packet submitted to the analyst included multiple distinct HB 2122 drafts from different states and on other subjects (transportation/vehicle registration, SNAP, local government technical edits). This summary isolates and describes the Missouri energy/utilities provisions allowing CWIP inclusion in rate base.

Compiled from official sources — confirm details with the bill’s official record.

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