The Dangerous Gamble: Why Missouri Must Reject Electricity Market Restructuring

The Current Debate in Missouri

Missouri lawmakers are currently weighing whether to restructure the state’s electricity markets, a decision that could fundamentally alter how power is generated, distributed, and priced for millions of Missourians. This debate comes at a critical juncture as Missouri experiences unprecedented electricity demand from data centers, manufacturing expansion, and widespread electrification across various sectors. The proposed restructuring would move Missouri away from its current vertically integrated regulatory structure—where utilities plan ahead and build energy systems serving customers with reliable power—toward a market model driven by short-term price signals that often discourage long-term investment.

The Evidence From Restructured Markets

The record from other states that have undergone electricity market restructuring presents a sobering picture of failure and unintended consequences. When reliability mattered most during extreme weather events, restructured markets repeatedly failed to deliver. The performance during Winter Storm Elliott in 2023 serves as a particularly stark example: in the PJM region, which includes parts of the Mid-Atlantic and Midwest, nearly one quarter of the generation fleet failed, and the grid operator barely avoided implementing rolling blackouts that would have left families freezing in the dark.

Analysis from Charles River Associates reveals that retail electricity rates in many restructured states, including several within PJM, have risen faster over the past decade than in vertically integrated states. In PJM specifically, capacity market price spikes and wholesale volatility flow directly into customer bills, exposing families and small businesses to sudden, dramatic cost increases that can devastate household budgets and business viability.

Structural Flaws in Restructured Markets

Restructured markets exhibit fundamental design flaws that undermine reliability and cost stability. Power plant operators in these regions tend to invest less in weatherization and resilience measures, delay critical fuel-supply upgrades, and often fail to subscribe to firm natural gas delivery contracts. Perhaps most tellingly, no commercial nuclear plant has ever been completed and placed into service in a restructured market, demonstrating how these markets discourage the long-term, capital-intensive investments necessary for a resilient energy future.

Recent capacity auctions have produced sharp price jumps tied to tightening reserves and market rule changes. Even with elevated capacity market prices, PJM still had to rely on out-of-market “reliability must run” contracts to secure 2,100 megawatts of coal-fired generation. When a market must routinely intervene outside its own price signals to maintain basic reliability, it raises serious questions about whether the market design aligns with actual system needs.

In late February, PJM agreed to extend a price cap on its capacity auctions for two additional years at the urging of state officials and with federal regulatory approval. While this action may limit near-term cost volatility, it also reveals deeper structural issues in markets where price spikes can ultimately be passed through to consumers, undermining the very purpose of market competition.

Missouri’s Current Success Story

Missouri currently enjoys some of the nation’s most affordable electricity rates, and this is no accident. It results directly from a regulated market that allows for long-term planning, strategic investment in winterization, construction of firm dispatchable generation, and systematic upgrades that maintain grid resilience. The state’s vertically integrated structure enables utilities to plan generation, manage retirements, and spread costs over time, reducing exposure to abrupt, market-driven bill shocks that have harmed consumers in restructured states.

Last year, Missouri lawmakers reaffirmed the state’s reliability priorities by requiring that retiring power plants be replaced with always-on, dispatchable energy. This forward-thinking approach recognizes that meeting growing electricity demand—particularly from data centers, manufacturers, and electrification—requires responsible investment in nuclear power, modern natural gas plants, storage solutions, and hardened grid infrastructure. These are long-lived assets that depend on predictable cost recovery over 20 to 40 years, something restructured markets consistently fail to provide.

The Grave Risks of Abandoning Proven Success

The push for electricity market restructuring represents a dangerous ideological experiment that threatens Missouri’s energy security, economic competitiveness, and household financial stability. What proponents of restructuring are essentially proposing is to abandon a system that has delivered affordable, reliable power for decades in favor of a model that has repeatedly failed American families when they needed it most.

This isn’t merely an academic debate about market theories—it’s about whether Missouri families will be able to heat their homes during winter storms, whether small businesses will face unpredictable energy costs that threaten their viability, and whether Missouri’s economic development will be jeopardized by unreliable power. The evidence from other states shows that restructuring leads to higher costs, reduced reliability, and increased vulnerability during extreme weather events.

When the next severe storm system arrives—and it will—Missourians deserve a system built for resilience, not one modeled after markets that failed families in freezing weather. The current vertically integrated structure has proven its ability to weather storms literally and figuratively, while restructured markets have left consumers shivering in the dark while facing skyrocketing bills.

A Call for Prudent Leadership

Missouri lawmakers must proceed with extreme caution and full awareness of what electricity market restructuring has meant in other states, and who paid the price when the lights went out. The families, farmers, and small businesses who depend on affordable, reliable electricity deserve representatives who will protect their interests rather than gamble with their energy security.

Preserving Missouri’s regulated structure isn’t about resisting change; it’s about recognizing what works and building upon success. It’s about understanding that some services—particularly essential infrastructure like electricity—require long-term planning and investment that market forces alone cannot provide. The profit motive that drives restructured markets often conflicts with the public interest in reliability, affordability, and resilience.

Missouri can continue to enjoy affordable, reliable electricity that supports industry, families, and future growth. But doing so requires preserving the regulated structure that encourages long-term investment and storm preparedness. The alternative—restructuring—would undermine decades of progress and expose Missourians to the same failures that have plagued other states.

This moment calls for leadership that puts the interests of Missouri citizens above ideological experiments. It demands representatives who understand that reliable, affordable electricity isn’t a luxury—it’s a fundamental requirement for modern life, economic prosperity, and human dignity. The evidence is clear, the stakes are enormous, and the choice should be obvious: Missouri must reject electricity market restructuring and continue building upon its proven successful model.