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Westar seeks rate increase for residential, small-business customers

  • The Wichita Eagle
  • Published Monday, April 15, 2013, at 7:48 p.m.
  • Updated Tuesday, Dec. 3, 2013, at 10:41 a.m.

Westar Energy filed late Monday for state permission to increase electric rates for residential customers by about $7.50 a month while cutting rates for medium and large businesses.

Westar is seeking an overall $31.7 million in rate increases to pay for environmental upgrades, primarily at the company’s coal-fired power plants in northern Kansas.

However, the rate hike for residential customers would be about $62 million – almost twice the overall increase – to accommodate Westar’s desire to simultaneously cut electric rates for medium- to large businesses, according to an analysis by the Citizens Utility Ratepayer Board.

Westar also is seeking to raise rates for small businesses by $21 million to help offset the cuts for bigger businesses, said CURB, the state agency that represents home and small-business utility consumers.

The CURB analysis said Westar’s plan contains the $46.8 million in rate cuts for businesses. Of that:

• Medium business would see a $18.5 million reduction.

• Large business, a $17.4 million reduction.

• A single unidentified business customer on a special contract, a $9.76 million reduction.

• Schools, a $1.2 million reduction.

The proposal is a follow-up to a rate case last year in which Westar was granted $50 million in increases, $42 million of which is now being paid by residential and small-business customers.

According to Westar estimates, the proposed rate increase and rebalancing together would add about $7.50 a month – or about a 25 cents a day – to the power bills of a typical residential customer using 900 kilowatt-hours a month.

The company said in a statement that it proposed the rebalancing of residential and business rates because “in recent years, rates for larger businesses have risen higher than those in some neighboring states and no longer reflect the cost of providing electricity to these firms. Westar’s proposal takes steps toward correcting this to help Kansas remain competitive.”

Springe, however, said he thinks the motivation for rebalancing rates is “so that Westar can give business a huge discount. Large business will pay half what residential customers pay for service, out of the exact same generating plants.”

Westar also is seeking additional rate flexibility to work with economic development agencies on projects to attract and expand businesses, and proposing a fund to help low-income customers pay their power bills.

No information was available late Monday on when or how the Kansas Corporation Commission would consider the request.

Reach Dion Lefler at 316-268-6527 or dlefler@wichitaeagle.com.

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