Jon Styslinger, Altec senior vice president, right, lead Missouri Governor Jay Nixon on a tour of the facility Monday morning in St. Joseph. Gov. Nixon was in town to sign the Energy Efficient Investment Act into law.

Gov. Jay Nixon toured Altec Industries in St. Joseph Monday morning before signing legislation into law aimed at increasing energy efficiency in Missouri.

Dubbed the Energy Efficient Investment Act, SB 376 will allow electric companies to recoup costs from energy conservation programs by permitting them to change their rates accordingly. That can only happen if the Public Service Commission deems that the new rates are equal to or less than what the electric companies would’ve charged if they’d opted to build a new power plant, according to the bill.

“My friends, that is a big turn,” the Democratic governor told a group of Altec and KCP&L executives Monday morning, along with other community members at the ceremonial signing. “It is an important, historic step for the state of Missouri.”

Mr. Nixon faulted the current rate structure for giving utility companies incentives for higher power outputs and disincentives for efficiency efforts.

This bill, which goes into effect Aug. 28, will let the PSC establish rates that make energy efficiency at least as profitable as building a new power plant, Mr. Nixon said.

“An amount of energy saved (will be counted) as the same exact value as a unit of energy produced,” Senate President Pro Tem Charlie Shields, R-St. Joseph.

Bill author Sen. Brad Lager, a Savannah Republican, said the bill is designed to deter the creation of coal and nuclear plants and instead incent homeowners and companies to partner with utilities to find ways to reduce energy.

Mr. Lager said energy efficiency is an essential part of becoming more energy independent.

“It’s something we can do today that has an immediate impact,” Mr. Lager said.

Alyson E. Raletz can be reached at alysonraletz@npgco.com.