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Evergy, Regulators Near Deal on Kansas Electric Rates

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Regulators will hold a hearing on the agreement on Monday.

By Allison Kite, Kansas Reflector

 

Evergy is close to a deal with state regulators that would reduce electric rates in the Kansas City area and raise costs for the company’s other Kansas customers.

If the deal is approved by the Kansas Corporation Commission, Evergy’s Kansas Central territory — including Topeka, Manhattan and Wichita — would see rates increase by 4.05%, about $4.64 per month. Customers on the Kansas side of the Kansas City metro would see a 4.75% decrease, or about $6.07.

The deal, announced late Friday, is a major departure from the rate increases Evergy requested: a 9.7% increase for Kansas Central and a 1.95% increase for the metro.

“This settlement is a very strong result for our customers,” Evergy’s president and CEO, David Campbell, said in a news release.

Evergy serves 1.6 million electric customers in Kansas and Missouri. It formed from the merger of Kansas City Power & Light, which supplied energy to the metro area, and Westar, which covered most of the rest of eastern and central Kansas, in 2018. Since then, it has been under a rate moratorium as a condition of the merger. This rate case, filed with the Kansas Corporation Commission in April, is the first in five years.

In its April filing, Evergy requested rate increases in both of its Kansas territories that would bring in a combined $218 million to the company.

For Kansas Central customers, Evergy’s request would have increased bills by $14.24. Kansas City-area customers would have seen bills jump by $3.47.

But staff of the Kansas Corporation Commission said Evergy’s request was too steep.

In a filing in August, the commission’s staff recommended only a 1.66% increase for Kansas Central and a 7.32% drop for the Kansas City metro. Under staff’s recommendation, Evergy would have seen an overall decline of $40 million.

The settlement deal filed with regulators last week lands in the middle.

The deal —supported by Evergy, the commission staff and numerous consumer, environmental and business groups — still has to be approved by the commission.

If approved, the rate changes in the deal would bring in another $41 million for Evergy, less than one-fifth of the revenue it hoped to bring in from customers.

In a filing in support of the negotiated deal, Justin Grady, who works in the utilities division of the Kansas Corporation Commission, said the compromise includes “just and reasonable rates, is in the public interest and is supported by substantial competent evidence in the record.”

Noting the wide variety of interest groups that signed onto the deal, Grady wrote, “the fact that these varied interests were able to collaborate and present a unanimous resolution … strongly indicates the public interest standard has been met.”

The three-member Kansas Corporation Commission is expected to hold a hearing about the deal Monday and decide whether to approve it by December.

While this rate case could soon be settled, another one is likely to follow soon.

Normally, utilities file general rate cases every few years, but Evergy requested permission to file another one next year to deal with the spike in demand expected from the Panasonic plant planned in DeSoto.

According to filings with the KCC, the Panasonic plant is expected to use twice as much energy as Evergy’s largest current commercial customer. The plant, which will produce batteries for electric vehicles, requires an amount of energy Evergy likened to a small city.