Regulators reverse, allow consumer board input on Westar rate issue
05/19/2014 5:40 AM
08/06/2014 8:37 AM
The Kansas Corporation Commission on Tuesday headed off a potential court showdown with another state agency by allowing consumer advocates to join a case over $10.5 million in Westar Energy rates.
Commissioners reversed a decision by their pre-hearing officer and granted intervention to the Citizens’ Utility Ratepayer Board, the state agency that represents residential and small-business utility customers.
The underlying case involves Westar’s annual Energy Efficiency Rider, a bill charge to reimburse the company for money it spends encouraging customers to conserve electricity.
KCC prehearing officer Brian Fedotin had ruled in August that CURB had failed to show that its participation in the case was necessary to protect the interests of the consumers it represents.
CURB appealed to the full commission, saying that its participation in cases involving Westar’s rates is guaranteed by the law that created the agency.
In its order granting CURB intervention, the commission wrote that it “finds that by stating the rates paid and the services received by residential and small business customers will or may be affected by this proceeding, CURB has demonstrated an interest in this proceeding.”
David Springe, chief consumer counsel for CURB, said that’s almost exactly the same wording CURB used in its original petition to intervene three months ago.
“It’s unfortunate we had to spend so many legal resources to get to this place,” he said.
Still, he said he was pleased that commissioners decided to reverse Fedotin’s decision.
“We don’t have to take a side trip to court, hopefully,” Springe said.
Springe said CURB wanted to intervene in the case simply to back-check KCC staff and make sure that the charges Westar is requesting are reasonable.
Without CURB participation, the only groups involved would have been Westar and the KCC staff, which cannot legally challenge commission rulings in court.
CURB intervention has been a matter of routine until this year, when the commission began requiring more detailed justification from parties who wanted to participate in cases.
While the case at hand represents only a small change in customer bills – actually a 6 cents a month cut from current rates for the average home consumer – CURB took a strong stand on the principle that state laws guarantee its right to analyze and comment on all rate matters involving state-regulated utilities.
Last year, the commission approved an $11.9 million rider, which added about 54 cents to the base rate for an average-usage customer. This year’s rider, at $10.5 million, is estimated to cost that same consumer about 48 cents a month.
About $6.3 million of this year’s request is to pay for a program that provided advanced thermostats to home customers. The thermostats allow Westar to turn the customers’ air-conditioner compressors off and on to balance loads during peak-usage periods in summertime.
Another $4 million is to pay for a contract with Westar’s largest customer: the Occidental Chemical Corp. Plant on South Ridge Road in Wichita.
The contract allows Westar to interrupt service to the company on short notice. While Westar has never done that, company officials said the option saves Westar and its customers the cost of having to build a small power plant.
Shane Batchelder, a spokesman for Westar, said the company doesn’t have a problem with CURB reviewing its rider application.
“It’s pretty much just part of the process and doesn’t really change what we’re doing,” he said, adding that Westar sees intervention as a matter for the KCC and CURB to work out themselves.
KCC staff has already recommended approval of the rider charge as proposed by Westar, saying staff analysts “found the calculations to be accurate and consistent with prior commission orders.”