Questions about electricity bills are blowing in the wind

This graph shows Evergy’s declining use of fossil fuels since starting wind generation in 2010. Wind, specifically, is slated to be Evergy’s biggest source of power annually.

Earlier this summer, the Kansas Corporation Commission gave both Kansas Gas Service (KGS) and Evergy the approval to tack on a recurring charge to customers’ monthly bills for multiple years so that KGS and Evergy can incrementally recoup the extraordinary costs of natural gas prices set over a year ago during Winter Storm Uri in February 2021.

The recurring charges might decrease. If ongoing federal investigations into possible market manipulation by natural gas wholesalers produce recovery, both KGS and Evergy will pass it on to customers.

It is yet another turn in the Kansas electricity saga that is likely to ramp up again in 2023 as Evergy is set to embark on a Sustainability Transformation Plan which will enhance transmission.

However, according to the Kansas Industrial Consumers Group (KIC) and its initiative Kansans for Lower Electric Rates (KLER), this should be a concern for Evergy customers.

In February 2022, KLER proposed a state bill which sought to cap electric rate increases in Kansas at 1% above customers’ monthly bill from the previous year for ten years, with unregulated things like fuel costs and other unpredictable variables like transmission rates remaining uncapped. During testimony in the committee hearing, KLER’s lawyer expressed that electricity in Kansas should be a free market. The bill, which featured a tighter regulation on electricity in Kansas, did not pass committee.

The Kansas oil and gas resources fund (Kansas Strong), who informs the public on how Kansas prospers through petroleum products, asks in their latest advertisement, “In every single state that has received over five percent of its electricity from renewable sources,” which has happened: “large increases or decreases in electric rates?” A contestant on the fictional game show called Flip That Switch reckons that since the air and sunlight are free, electric rates must be going down. But she is corrected by the host, who says, “Electric rates have increased dramatically!”

Though, while Kansans receive significantly more electricity from renewables than five percent, Kansas Evergy customers have not seen an electric rate increase since the investor-owned utility’s founding merger in 2018. Evergy’s streamlined costs of operations have lowered the price 4% for their customers while staying below the rate of inflation and ensuring Evergy shareholders only make a nominal profit—not an economic one—which is a requirement of the KCC to gain electric rate approval.

However, former Westar customers indeed saw a dramatic 63% price increase on their annual electric bills over the span of twenty years prior to Evergy’s merger. The higher price was the cost of a $3 billion deficit attributed to a former CEO’s alleged mismanagement, federally-mandated emission controls for their coal-fired plants and investments into fuelless wind generation which reduces their captivity to natural gas prices.

There is a completely separate federal investigation ongoing into Evergy’s present Sustainability Transformation Plan centered around the possible rate increases that would be charged to customers financing the STP, though it hasn’t been updated since 2021. Many of the people opposed to the STP, like KIC and Kansas Strong, express that Evergy’s investment spending is an excuse to make more money off customers’ monthly bills.

Evergy says the STP will increase transmission network and efficiency. This will make the power grid more reliable and additionally allow Evergy to sell more competitive electricity on it—which results in future savings.

For example, Evergy made such a profit in the Kansas Metro service territory during Winter Storm Uri that customers there will receive a passed-on credit in their monthly bills and not a recurring charge. This is due to their conservation made possible by the service territory’s efficient transmission.

Jim Zakoura, president of KIC, has confirmed he is continuing to represent KIC after his Overland Park office was absorbed into a larger legal firm on Aug. 1, 2022.

Edited by: Simran Shrestha, Maggie Cabrera