State regulators order Evergy to explain $1.2 billion
WDAF-TV (Kansas City, MO)
TOPEKA, Kan. (KSNW) -- The Kansas Corporation Commission has ordered Evergy to explain a $1.2 billion increase in the company's capital spending plan filed this year compared to projections shared when the company presented its Sustainability Transformation Plan (STP) last year.
The KCC plans to hold a workshop to discuss the matter sometime before December. The date will be announced by the end of September. The KCC said the public will be able to watch the workshop on the KCC YouTube channel.
"I believe the magnitude of the dollars we're talking about and the difference in a short amount of time warrants this further discussion and sharing of information," Commissioner Susan Duffy, KCC, said.
Before the workshop, the KCC says that Evergy must file updated and comprehensive financial modeling showing expected retail rate changes resulting from the continued increases in projected capital expenditures.
Then, during the workshop, Evergy will have the opportunity to explain the reason and impact of the proposed capital spending. Members of the KCC and the Citizens Utility Ratepayer Board (CURB) will be able to ask Evergy questions.
We reached out to Evergy for its response to the KCC order. Gina Penzig, the external communications manager, said affordable electricity and competitive rates are a top priority for the company.
"Our capital investment plan is consistent with achieving regionally competitive rates," she said. "Over the past four years, Evergy has reduced our operational costs by hundreds of millions of dollars keeping rates flat for customers. Our capital investment plan is low compared to our regional peers and is laser-focused on maintaining a reliable electrical grid and ensuring a responsible transition to cleaner and renewable energy sources."
Penzig said the company sees the KCC workshop as an excellent opportunity to provide additional information on the need for Evergy's planned investments and how they will benefit customers.
"The Commission expressly states that the information we provided meets their filing requirements, but they'd like more detail," she said. "We look forward to the dialogue with the Commission and regulatory stakeholders."
Evergy is required to file an annual Capital Investment Plan with the KCC.
A report filed by KCC staff in response to the 2022 report expressed concern that the expenditures outlined exceeded those reported in the STP by 21.82%.
The KCC says the 2022 five-year Capital Investment plan was $1 billion higher than the 2021 five-year plan, and this increased spending projection was on top of a previously announced $1 billion increase between Evergy's 2020 and 2021 five-year plans.
The KCC echoed the staff's concerns regarding the dramatic capital expenditure increase projections and whether that trend will undermine the goal of achieving regionally competitive rates and reliable electric service, especially with rising inflation.
The KCC order states, "Evergy's Capital Improvement Plan affects the majority of Kansans and thus requires public scrutiny."
Click here to read the 11-page order. You can also view the KCC's business meeting on its YouTube channel.