By Derek Spellman

dspellman@joplinglobe.com

Empire District Electric Co. is requesting a 19.6 percent rate increase, the company announced Thursday.

If the full request is approved, the average residential customer would see a monthly increase in the utility bill of about $19.21, assuming usage of 1,000 kilowatt-hours of electricity, the company said in a statement released after it had filed the request with the Missouri Public Service Commission.

Plant investments

Bill Gipson, Empire president and CEO, said the company is seeking the increase largely to recoup its share of the investment it has made in the construction of two new coal-fired generating units — one near Kansas City and one near Osceola, Ark. — that it jointly owns with other companies. The rate increase also would help the company recoup its share of the cost of environmental upgrades to a coal-fired unit near Kansas City that it also jointly owns, and absorb the operation costs that will accompany the three units.

“This case has been a long time coming,” Gipson told the Globe on Thursday, saying plans for the three projects started years earlier.

The upgrades to the one unit were completed earlier this year. Construction of the other two units is expected to be complete next summer.

Empire’s investment in the three projects is to total between $366 million and $378 million, according to a presentation from company officials.

If the request is approved by the Public Service Commission, the new rates would not become effective until the fall of 2010.

“I don’t see it any earlier than September of next year,” Gipson said.

Company officials said Empire began considering the plans years earlier, knowing that an agreement it had to purchase power from another coal-fired operation in Kansas was to expire in May 2010. That agreement could not be renewed because that plant would no longer have the capacity to continue supplying Empire, forcing the latter to find another source, Gipson said.

The construction of the new coal-fired units, in which Empire has a minority ownership, offered the “least-cost alternative” to absorb that power shortfall and continue meeting demand, Gipson said. The company also sought to avoid natural gas-fired generating units that he said would be more costly for customers in terms of providing power.

“It’s our obligation to do this and to find the least-cost alternative,” he said, noting that the company also had explored partnerships with other companies.

“There were a number of opportunities, but these two came to fruition.”