Lawmakers presented data showing electric rates gradually declining

Photo credit: Tony Boon

With a battle developing over utility regulation, new data show Kansas has seen a gradual decline in electric rates over a six-year period.

Justin Grady, of the Kansas Corporation Commission’s utilities division, briefed the House utilities committee 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 (10.9%), 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%).

Industrial rates in Kansas, meanwhile, increased 1.12% from 2020 to 2021.

The highest average industrial rate increases for that period were in Texas (20.74%), Oklahoma (19.31%) and Arkansas (11.52%), the data showed.

Grady also pointed to data showing that average residential electric bills for Kansans – not the rates – ranked six out of the 10 states to which it was compared.

In 2021, Kansas households had a monthly average bill of $115.53 compared to Texas, which was first in the region with a bill of $132.40.

The average residential bill for the 10 states examined was $115.35 and $121.01 nationally.

Grady urged lawmakers to study energy consumption, noting that there is an inverse relationship between residential electric bills and electric consumption.

He said Kansans used about 8% less electricity on average than the average of its peer states. Meanwhile, Kansas rates are about 8% higher than other peer states.

“As a result, the bills are almost indistinguishable,” Grady said.

“It’s not a coincidence that there is a very strong correlation between the amount of usage and the calculated rate,” he said.

Grady – the KCC’s chief of revenue requirements, cost of service and finance — laid out the utility costs at a time when there’s growing tension over utility rates.

Lawmakers are expected to take up a bill that calls for electing members of the KCC in response to complaints about the state’s high electric rates.

There are other bills addressing utilities as well, including one that would require the KCC to study regional electric rates before approving any increases in the future.

But the data that Grady presented left some lawmakers thinking that utility rates are not as high as advertised.

“To me, it looks like we are regionally competitive,” said Republican state Rep. Mark Schreiber of Emporia, who sits on the House utilities committee.

“We’re within the ballpark of the other states around us,” Schreiber said.

“To me, it’s not demonstrating we’re so far out of whack with our neighbors that it would cause companies to flee or businesses not to locate here,” he said.

Republican state Rep. Leo Delperdang, chair of the House utilities committee, said he’s still trying to get a fix on the cost of electricity in Kansas.

“We keep hearing over and over and over how Kansas has rates so much higher than all the surrounding states,” said Delperdang.

“I’m trying to get my hands around that right now,” he said.

Delperdang said the data eased his concerns about rates “a little bit,” but he still wants to know conclusively how Kansas stacks up with other states in rates.

“It looks like we’re more in line than what we are perceived,” Delperdang said of Grady’s presentation. “That was my take away from it.”

Kansans for Lower Electric Rates, a coalition made up of heavy power users, midsized businesses and some school districts, ripped Grady’s report.

“Despite what the KCC portrays, 1 million Evergy electric customers in the state would disagree,” said Paul Snider, the group’s lobbyist.

“Kansas electric rates are not competitive with Oklahoma, Iowa, Arkansas and other surrounding states,” he said.

“It’s unfortunate the KCC doesn’t take any ownership of the problem or help try to make our rates more competitive,” Snider said.

“There wasn’t one word about Kansas needing to improve. That’s why KCC reform is needed.”