Latest news with #CWIP
Yahoo
08-07-2025
- Business
- Yahoo
Kansas regulators approve Evergy natural gas plants, solar plant despite rate concerns
The Kansas Corporation Commission hears testimony on Evergy rates in June. On Monday, the KCC unanimously approved the company's plan to build new natural gas and solar plants. (Morgan Chilson/Kansas Reflector) TOPEKA — The Kansas Corporation Commission gave Evergy the go-ahead to build two natural gas plants and a new solar plant, over the objections of multiple parties. Evergy Kansas Central customers will see bills increase about 8.6% to build the new plants, KCC filings said. EKC, the subsidiary of Evergy Inc. that serves Kansas customers, will be 50% co-owner of the two 710-megawatt combined cycle gas turbine plants and 100% owner of the Kansas Sky solar facility, to be built in Douglas County. The Viola gas plant will be built in Sumner County, and the McNew gas plant will be in Reno County. Cost of construction is estimated to be $788.75 million for the Viola plant and $800.52 million for the McNew plant, according to EKC's filings. The solar field is expected to cost $228.1 million. The other half of the two natural gas plants will be owned by Evergy Missouri West, but only if the Missouri Public Service Commission — KCC's Missouri counterpart — approves the construction. The Missouri commission's staff has recommended against pre-construction approval because too many costs in the proposal were uncertain, according to Missouri Public Service Commission filings. The unanimous decision from Kansas' regulatory commission Monday afternoon to approve building two natural gas plants and a solar field was the first time in 15 years the KCC has been asked to do a pre-determination docket, said Brian Fedotin, KCC counsel. In a pre-determination docket, Evergy seeks KCC approval before beginning construction. The company can then use a construction work-in-progress rate mechanism, called a CWIP, approved by the Kansas Legislature in 2024, according to the Citizens' Utility Ratepayer Board. The CWIP lets companies begin charging customers for new infrastructure projects while they are under construction, rather than waiting until the next rate case to recover costs. In Kansas, utility companies typically invest in infrastructure or other initiatives and then add the costs of those projects during a rate case that occurs after the projects are completed. The CWIP allows the company to collect dollars to fund projects as they are built, and it can be added to customer bills one year after construction begins. The decision to build the natural gas plants was opposed by the Citizens' Utility Ratepayer Board, industrial consumers and environmental groups, among others. In general, most agreed with building the solar plant, according to documents filed at KCC. Commissioners also made note of their concerns about Evergy rates. 'The commission is concerned and troubled by the frequency and magnitude of rate cases, and strongly encourages Evergy to focus on pacing its proposed investments to better align those investments with actual load growth and the mitigation of large rate increases,' said Commissioner Dwight Keen at Monday's virtual hearing. Keen said that while the commission approves the addition of generation capabilities to meet the needs of Kansans and ensure stability of the power grid, they remain concerned about rate increases. Evergy currently has a separate rate case at KCC, asking for as much as a 15% hike to residential rates, which would be on top of the increase from building the plants. Evergy last received a $41 million rate hike in 2023. 'The commission understands that from time to time, new investment in electric capacity is needed to support reliability and economic development in Kansas,' he said. 'However, affordability and genuine maximum capacity needs must be major priorities and proactively pursued as Evergy addresses a seemingly endless list of ostensibly justifiable projects and initiatives.' His words were matched by opponents to building the natural gas plants. Jim Zakoura, president of the Kansas Industrial Consumers Group, said Evergy has enough generation to meet electricity demand if current electricity systems, such as coal plants, are not retired before the end of their useful manufacturing life. 'Evergy's plans to retire coal facilities early, while those facilities continue to provide electric service at costs which are far lower than new gas-fired generation, is not related to increased electric demand,' Zakoura said in a statement. 'It is simply trading low-cost generation for high-cost generation to serve the same level of demand. Retail ratepayers get no greater value for their money — only higher prices.' KCC staff and commissioners don't agree. 'The oldest of the Jeffries units was commissioned in 1978 and will be over 50 years old if the proposed Viola combined cycle gas generation plant comes online in 2029,' Keen said. 'It is impossible to know the exact timing of when coal units will retire. Load growth may require their lifespan to be extended, or environmental policy changes or technological advances may shorten their lives.' Keen said an October 2022 fire at the Jeffrey Energy Center in Pottawatomie County caused that unit to be out of service for more than a year. Officials with the Sierra Club, which testified in the Missouri Public Service Commission case for Evergy's proposed plants and not in the Kansas case, said ratepayers are being asked to take on costs and subsidize a billion-dollar industry. 'Governor Kelly and KCC Commissioners supported and approved these gas plants, and now they have the opportunity to ensure that utilities and data centers pay their fair share, because the alleged new demand for electricity is from data centers, not Kansas families or existing businesses,' said Zack Pistora, director of the Kansas chapter. Dorothy Barnett, executive director of the Climate + Energy Project, expressed concerns that natural gas prices are difficult to predict. 'I am really worried that we are going to push ourselves into a really risky position with fossil fuels,' she said. 'I obviously am concerned about the climate impacts of adding fossil fuels, right? But secondarily, gas prices are so volatile. We saw that with Winter Storm Uri. It's supply and demand.' Winter Storm Uri brought arctic weather to the Midwest in February 2021, resulting in increased utility prices for most customers after natural gas prices shot high because of production problems and high usage. Costs of natural gas are a 'straight pass-through' from the utilities, she said. She referred to Empire District Electric, which in 2007 served southeast Kansas. 'They were heavily invested in gas and people couldn't pay their bills,' Barnett said. 'They were one of the first utilities that began to invest in wind in Kansas. It wasn't because they cared about the environment or cared about clean energy. It was because they were trying to diversify their fuel mix so that they weren't reliant on gas.' Evergy spokeswoman Gina Penzig said in a statement the company is pleased with KCC's approval to help ensure system reliability. 'Kansas and Missouri are experiencing record economic growth, and today's predetermination order affirms that the plants are needed to serve customers and are an efficient way to meet the growing demand,' she said.
Yahoo
11-03-2025
- Business
- Yahoo
Bill loosening rules for Missouri electric rates speeding toward passage
State Sen. Mike Cierpiot, a Republican from Lee's Summit, on Monday presents his bill allowing utilities to charge customers for power plants while they are under construction to the House Utilities Committee. (Rudi Keller/Missouri Independent) A bill changing how utility rates are set won overwhelming approval in a Missouri House committee Monday after a hearing where backers said it is vital to the state's economy and opponents said it would soak consumers with higher costs. The proposal to repeal a 1976 law passed by initiative petition that prohibits companies from charging for power plants under construction but not yet operating has already passed the state Senate. Following the 17-4 vote Monday in the House Utilities Committee, it could go directly to Gov. Mike Kehoe if nothing is changed during the upcoming debate in the full House. The legislation would allow companies to seek rate increases for 'construction work in progress,' or CWIP, with a specific allowance for new generating plants that burn natural gas and an allowance in another section for any generating plant that is an approved resource plan. The initiative that passed the 1976 law was launched by people upset over rate hikes allowed for the construction of a nuclear power plant in Callaway County. The bill repeals the ban for 10 years and allows the Public Service Commission to extend it for another 10. State Sen. Mike Cierpiot, the Republican from Lee's Summit who is sponsoring the bill, said he doubts the new CWIP allowance would be used for a new nuclear power plant. 'I was asked to have nuclear CWIP this bill, and I actually don't think that's a horrible idea, but I think it's kind of 15 years off before we actually start deploying those,' Cierpiot said. Massive utility legislation expected to boost Missouri power generation — and energy bills In the Monday vote, two of the committee's seven Democratic members supported the legislation along with 15 of 16 Republicans, while three Democrats and one Republican were opposed. During two hours of testimony, opponents argued the CWIP provisions, when coupled with other allowances for utilities to seek more from customers, would add as much as $1,100 a year to residential electric bills. 'This bill is not designed to benefit Missourians,' said Gretchen Barwick, director of the Missouri chapter of the Sierra Club. 'It's designed to provide corporate welfare to monopoly utilities.' Representatives of utilities and the Public Service Commission said growing power demands mean new generation plants will be built in the Midwest. Passing the law allowing the charge for construction of new plants will be an incentive to build in Missouri, they said. Large industrial users of electricity will locate plants where power is plentiful, said Jason Klindt, senior director of external affairs at Evergy. The bill includes requirements that large users pay a rate that is not subsidized by residential users, he said, arguing that will spread the cost out and result in lower overall rates for everyone. Evergy is the major power provider for western Missouri. It is building two new gas-fired power plants in Kansas. The company would like to build in Missouri as well, Klindt said. 'We look forward, frankly, to announcing new power plants if we can get this bill across the finish line,' he said. The bill would apply to investor-owned utilities regulated by the PSC. The commission has no control over rates for municipal power companies or rural electric cooperatives. The bill would also allow all utilities regulated by the commission — water, gas and sewer along with electricity — to seek rates based on what the bill calls a 'future test year.' Currently, rates are set after the PSC examines the actual costs incurred to deliver service and determines if each expense was prudent and necessary. In a future test year scenario, the utility would outline what it expects to spend and the costs would be pre-approved by the PSC. There are some aspects of the bill intended to benefit consumers. The Office of Public Counsel, which represents the interests of ratepayers in utility cases, would receive dedicated funding for the first time from an assessment on utility revenues. There are changes to the rule blocking shutoffs for non-payment during hot and cold months as well as provisions requiring the commission to account for any federal tax savings by adjusting rates. The bill would also allow the PSC to order electric utilities to repay customers for construction work in progress charges if the plant does not go into service. The time is now for CWIP because of a rapidly escalating demand for power, said Rich Germinder, policy and strategic initiatives advisor to the PSC. The rapid increase in the number of electric vehicles and the construction of power-hungry data centers is helping drive up demand. 'Everyone was caught unprepared for the demands of the increased load growth that we're seeing,' Germinder said. Opponents of the bill said the items intended to help consumers won't offset the additional costs. All three of Missouri's major electric suppliers are before the commission seeking rate increases. Evergy is seeking a rate increase to boost revenues by 14%, Ameren, which serves eastern Missouri, is seeking a rate increase of nearly 16% and the Empire District Electric Company, which serves many smaller communities doing business as Liberty, wants regulators to increase its revenue by nearly 30%. The CWIP and future test year provisions will just add to the additional costs consumers already face, opponents said. If this legislation passes, it will be the most costly and expensive legislation ever passed by the Missouri legislature,' said Diana Plescia, attorney for the Missouri Industrial Energy Consumers, a consortium of 14 major manufacturers. The legislation will increase rates by an additional 40- to 80%, she said, making it too expensive to attract new investment. 'The damage to our economic base in Missouri will be real,' Plescia said 'And I say this in terms of both the jobs that will be lost and the jobs that will never come.' SUPPORT: YOU MAKE OUR WORK POSSIBLE
Yahoo
11-03-2025
- Business
- Yahoo
Bill loosening rules for Missouri electric rates speeding toward passage
State Sen. Mike Cierpiot, a Republican from Lee's Summit, on Monday presents his bill allowing utilities to charge customers for power plants while they are under construction to the House Utilities Committee. (Rudi Keller/Missouri Independent) A bill changing how utility rates are set won overwhelming approval in a Missouri House committee Monday after a hearing where backers said it is vital to the state's economy and opponents said it would soak consumers with higher costs. The proposal to repeal a 1976 law passed by initiative petition that prohibits companies from charging for power plants under construction but not yet operating has already passed the state Senate. Following the 17-4 vote Monday in the House Utilities Committee, it could go directly to Gov. Mike Kehoe if nothing is changed during the upcoming debate in the full House. The legislation would allow companies to seek rate increases for 'construction work in progress,' or CWIP, with a specific allowance for new generating plants that burn natural gas and an allowance in another section for any generating plant that is an approved resource plan. The initiative that passed the 1976 law was launched by people upset over rate hikes allowed for the construction of a nuclear power plant in Callaway County. The bill repeals the ban for 10 years and allows the Public Service Commission to extend it for another 10. State Sen. Mike Cierpiot, the Republican from Lee's Summit who is sponsoring the bill, said he doubts the new CWIP allowance would be used for a new nuclear power plant. 'I was asked to have nuclear CWIP this bill, and I actually don't think that's a horrible idea, but I think it's kind of 15 years off before we actually start deploying those,' Cierpiot said. Massive utility legislation expected to boost Missouri power generation — and energy bills In the Monday vote, two of the committee's seven Democratic members supported the legislation along with 15 of 16 Republicans, while three Democrats and one Republican were opposed. During two hours of testimony, opponents argued the CWIP provisions, when coupled with other allowances for utilities to seek more from customers, would add as much as $1,100 a year to residential electric bills. 'This bill is not designed to benefit Missourians,' said Gretchen Barwick, director of the Missouri chapter of the Sierra Club. 'It's designed to provide corporate welfare to monopoly utilities.' Representatives of utilities and the Public Service Commission said growing power demands mean new generation plants will be built in the Midwest. Passing the law allowing the charge for construction of new plants will be an incentive to build in Missouri, they said. Large industrial users of electricity will locate plants where power is plentiful, said Jason Klindt, senior director of external affairs at Evergy. The bill includes requirements that large users pay a rate that is not subsidized by residential users, he said, arguing that will spread the cost out and result in lower overall rates for everyone. Evergy is the major power provider for western Missouri. It is building two new gas-fired power plants in Kansas. The company would like to build in Missouri as well, Klindt said. 'We look forward, frankly, to announcing new power plants if we can get this bill across the finish line,' he said. The bill would apply to investor-owned utilities regulated by the PSC. The commission has no control over rates for municipal power companies or rural electric cooperatives. The bill would also allow all utilities regulated by the commission — water, gas and sewer along with electricity — to seek rates based on what the bill calls a 'future test year.' Currently, rates are set after the PSC examines the actual costs incurred to deliver service and determines if each expense was prudent and necessary. In a future test year scenario, the utility would outline what it expects to spend and the costs would be pre-approved by the PSC. There are some aspects of the bill intended to benefit consumers. The Office of Public Counsel, which represents the interests of ratepayers in utility cases, would receive dedicated funding for the first time from an assessment on utility revenues. There are changes to the rule blocking shutoffs for non-payment during hot and cold months as well as provisions requiring the commission to account for any federal tax savings by adjusting rates. The bill would also allow the PSC to order electric utilities to repay customers for construction work in progress charges if the plant does not go into service. The time is now for CWIP because of a rapidly escalating demand for power, said Rich Germinder, policy and strategic initiatives advisor to the PSC. The rapid increase in the number of electric vehicles and the construction of power-hungry data centers is helping drive up demand. 'Everyone was caught unprepared for the demands of the increased load growth that we're seeing,' Germinder said. Opponents of the bill said the items intended to help consumers won't offset the additional costs. All three of Missouri's major electric suppliers are before the commission seeking rate increases. Evergy is seeking a rate increase to boost revenues by 14%, Ameren, which serves eastern Missouri, is seeking a rate increase of nearly 16% and the Empire District Electric Company, which serves many smaller communities doing business as Liberty, wants regulators to increase its revenue by nearly 30%. The CWIP and future test year provisions will just add to the additional costs consumers already face, opponents said. If this legislation passes, it will be the most costly and expensive legislation ever passed by the Missouri legislature,' said Diana Plescia, attorney for the Missouri Industrial Energy Consumers, a consortium of 14 major manufacturers. The legislation will increase rates by an additional 40- to 80%, she said, making it too expensive to attract new investment. 'The damage to our economic base in Missouri will be real,' Plescia said 'And I say this in terms of both the jobs that will be lost and the jobs that will never come.' SUPPORT: YOU MAKE OUR WORK POSSIBLE
