The Empire District Electric Company Files For New Missouri Electric Rates

The Empire District Electric Company (NYSE:EDE) announced today it has filed a request with the Missouri Public Service Commission (MPSC) for changes in rates for its Missouri electric customers. The Company is seeking an annual increase in base rate revenues of approximately $30.7 million. The Fuel Adjustment Clause revenue will decrease $8.6 million resulting in a net impact to customers of $22.1 million, or about 5.3 percent. If approved by the MPSC, a residential customer using 1,000 kilowatt hours would see a monthly net increase in rates of about $6.60.

Empire is asking to recover:

Operation and maintenance expenses and capital costs associated with the May 22, 2011, tornado recovery, as well as cost of service post tornado.

Southwest Power Pool transmission charges. The Federal Energy Regulatory Commission has encouraged the addition of new transmission lines within the Southwest Power Pool (SPP) to improve the region's transmission system and make it more robust. As a member of SPP, Empire is allocated a portion of the costs.

Operating systems replacement expenses. Empire is installing new software systems. These systems were required as the existing systems approached the end of their useful lives and vendor support is no longer offered.

Vegetation management costs. The Missouri Public Service Commission has established rules governing vegetation management requiring Empire to inspect and trim trees every four years in urban areas and every six years in rural areas. Since 2006, outages due to vegetation in primary distribution lines have decreased by over 63 percent.

New depreciation rates. The change in ongoing depreciation expense includes the recovery of increased depreciation expense on Empire's Riverton units 7 and 8 due to their retirement as a result of new Environmental Protection Agency (EPA) standards.

The Company is also asking to continue the use of the Fuel Adjustment Clause (FAC). The continuation of the FAC will allow the Company to adjust customers’ bills twice each year, on June 1 and December 1, based on the varying costs of fuel used to generate electricity at the Company’s generating units and electric energy the Company purchases on behalf of its customers.

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