Evergy is seeking its first electric rate increase in five years, asking state regulators to approve a $218 million rate hike that would cost residential customers a monthly average of $14.24 in central Kansas and $3.47 in the Kansas City area.
The company is seeking a $204 million or a 9.77% overall rate increase for its 736,000 central Kansas customers, which includes Topeka, Pittsburg, Wichita, Hutchinson and other communities in the eastern third of the state.
In the Kansas City area, the company is requesting a revenue increase of $14 million or a 1.95% overall rate increase for its 273,000 customers in Lenexa, Overland Park and other communities near the Kansas City metro area.
The company is seeking to recover investments made to improve service for customers with a more reliable and resilient power grid and updated customer service systems.
The proposed rate increase filed with the Kansas Corporation Commission is the first one since 2018, when Kansas City Power & Light merged with Westar.
The company said operational cost savings and merger efficiencies allowed Evergy to maintain flat rates for its customers during the last five years.
Since 2017, overall rates for Evergy Kansas customers have increased just 0.1% and residential rates have decreased 2.5%, the company said.
During the same time period, other electric utility rates in states surrounding Kansas have increased nearly 13% while the Consumer Price Index has increased 20%, the company said in announcing the proposed rate increase.
In addition, since the merger, Evergy has delivered $232 million in merger savings and bill credits to Kansas customers, the company said.
In recent years, Evergy has been under increasing pressure in the Legislature from groups seeking to reduce the state’s electric rates, some of the highest in the region.
Kansas had the highest among seven midwestern states in February at 14.71 cents per kilowatt hour, according to the federal Energy Information Administration.
Kansas led Minnesota (13.45 cents), Iowa (11.6 cents), Missouri (11.57 cents), South Dakota (11.5 cents), Nebraska (10.25 cents) and North Dakota (9.97 cents).
Kansas led the region in rates for all customer sectors at 11.93 cents per kilowatt hour followed by Minnesota (11.49 cents), Missouri and South Dakota (10.22 cents), Nebraska (8.63 cents), Iowa (8.39 cents) and North Dakota (8.09 cents).
“Evergy is out of touch with our communities,” said Paul Snider, lobbyist for Kansans for Lower Electric Rates, one of Evergy’s biggest critics.
“How can Evergy seek such a significant rate increase when Kansas electric rates are already much higher than neighboring states?” he asked.
“Customers need a break, not another electric increase. We’ll show the KCC why this increase isn’t appropriate for Kansas customers.”
Earlier in the legislative session, Justin Grady, of the Kansas Corporation Commission’s utilities division, briefed lawmakers on federal data showing that average Kansas electric rates declined 0.19% from 2016 to 2021.
Kansas was only one of two states in the Midwest that saw a decline in average electric rates during the six-year period for which data was collected from the Energy Information Administration.
The only other state with a decline was North Dakota, which saw average rates fall 3.24%, according to the report Grady made to the utilities committee.
Kansas was compared to nine other states, including North Dakota, Colorado, Missouri, Oklahoma, Arkansas, Iowa, Minnesota, South Dakota and Texas.
The highest average increases were reported in Arkansas (11.9%), Minnesota (10.91%), Colorado (10.89%) and Oklahoma (8.8%).
Average residential rates in Kansas increased about 1% from 2020 to 2021, which was the lowest among the nine other peer states to which it was compared.
The highest average residential increases were in Oklahoma (8.7%), Arkansas (8.2%) and Colorado (5.76%).
Just this year, the Legislature passed a bill that took steps toward lowering electric rates and settles a dispute over a fee that Evergy levies to recover the cost of constructing electric transmission lines.
The compromise legislation gives the state more oversight over how Evergy recoups expenses from a transmission delivery charge that’s imposed on consumers when it undertakes new local transmission projects.
At the same time, the deal lowers the amount of return on equity the utility can get from building new local transmission lines, which will save ratepayers almost $11 million upfront and $2 million a year in the future.
About $9 million of those upfront savings would go to Evergy customers in central Kansas, while another $1.6 million would be directed to customers in the Kansas City metro area.
It translates into a savings of 47 cents a month for an average residential bill in central Kansas and 30 cents a month in the Kansas City area, lawmakers said.
