“It’s Going To Get Worse” Besides Utility Rate Hikes, Missouri CWIP Action Could Hit Hard

by Don Corrigan

With gas and electric rates moving upward, Missouri newspapers warn consumers that “it’s going to get worse.” This hardly tells the whole story, especially given the actions of the state legislature this year.

In the 2025 session, legislators approved CWIP (Construction Work In Progress). This overturned a “will of the people” measure dating from 1976. That measure stopped ratepayers from having to pick up the tab for projects until they’re online and producing energy for customers.

In 1976, Ameren wanted to bill ratepayers for a second nuclear reactor project east of Fulton in Calloway County. Ameren insisted the reactor was essential to meet energy needs, but the critical need suddenly evaporated when voters said “no” at the ballot box.

So what’s happening now?

Missouri voters’ action on CWIP has been honored for nearly five decades. What turn of events this year moved the legislature to overturn the people’s will as expressed in the 1976 statewide vote?

Some blame it on AI, which stands for artificial intelligence. AI is the simulation of human intelligence processes by sprawling computer systems. AI can be used by many technology-driven industries, such as health care, finance, and transportation.

Artificial Intelligence operations require special housing and large amounts of cooling water and electrical energy. Missouri lawmakers want to get in on the action. These AI data centers could use as much as 12% of total U.S. electricity by 2028.

These centers will only be located in Missouri if the state has the electrical energy for them. Groups such as Consumer Council of Missouri argue it’s manifestly unfair for ratepayers to be forced to pay for the energy projects.

What makes this prospect “manifestly unfair” is that the resulting energy from these projects will not benefit homeowners who foot the bill, but it will be a tremendous boon for the AI industry and stockholders.

Nevertheless, the legislators who rolled back CWIP protections, said that the state must improve its energy production to take advantage of the AI revolution. They contend new jobs for Missourians are on the line.

Rep. Josh Hurlbert, R-Smithville, said the legislation to void CWIP restrictions was essential for Missouri to compete in an era of new technology. The people’s will in 1976 had to be overturned.

“It’s time for us to modernize our utility policies to build more generation, if Missouri is going to be competitive in landing projects,” said Hulbert, a sponsor of the bill to end CWIP consumer protections.

“Normal Rate Hikes”

Consumers in Missouri have raised their voices at public hearings this year in opposition to what some might call “normal rate hikes.” Residents have bristled at utility rate hikes for services such as electricity, natural gas, and water consumption.

Meanwhile, some residents are keeping a close watch on how soon “abnormal rate hikes” may kick in for covering construction of new power plants to serve AI data centers. The economic impact will likely be traumatic for citizens in rental housing or for homeowners on tight budgets.

John Coffman, a Webster Groves attorney and counsel with the Consumers Council of Missouri, worries about spiking rate costs and also about the longevity of AI operations and the data centers.

“There’s the risk that they go out of business and then we’re all definitely picking up the tab for the energy that was built or required for that one customer,” Coffman said.

In the spring, the Missouri General Assembly considered — but did not pass — a number of policies concerning how Missouri might regulate the forthcoming data centers. Coffman expects the topic to return to the Capitol in 2026.

“I think it’s important when you’re looking at adding these types of projects to the system that you provide consumer protections to protect the rest of us from having to bail out a project,” he said.

Electrical power experts say it’s likely AI and its power-hungry data centers will be here to stay. But when it comes to internet technology, skeptics argue that much is uncertain.

Will residential users of electric power get stuck holding the bag – and tremendous bills – if data center projects go south or AI projects become dramatically energy efficient?

One thing is for sure, according to consumer protection advocates, state legislators have paved the way for utility users in Missouri to get stuck with alarming bills in the not-too-distant future.