A $78 million net increase in Westar Energy electric rates won approval from the Kansas Corporation Commission on Thursday.
The new rates represent about a 5.3 percent increase and will cost residential customers about $5 to $7 more a month for electricity, state and company officials have said.
The rates are included in a settlement reached in negotiations involving Westar, the KCC staff and the Citizens’ Utility Ratepayer Board, the state agency that represents residential and small-business customers.
The revenue increase for Westar is slightly more than half the $152 million the company originally sought in the rate case.
The bulk of the increase is to allow Westar to recover costs of mandatory environmental upgrades at the La Cygne coal-fired power plant and modifications to extend the service life of the Wolf Creek nuclear plant at Burlington.
The Wolf Creek extension will add 20 years to the life of the plant, pushing back its decommissioning from 2025 to 2045, Westar spokeswoman Gina Penzig said.
The company is legally entitled to recover those costs through its rates.
Westar is expected to come in next year requesting a much smaller rate increase, to sweep up some final costs from the projects that fell outside the time frame of the current rate review, said David Springe, chief consumer counsel for CURB.
Springe said CURB is very pleased with the agreement.
“Rates were going to go up regardless,” he said. “I think Westar was very reasonable and we’re happy we could get a settlement.”
Commissioners unanimously approved the agreement without comment, settling the case for the vast majority of customers.
The new rates will take effect Oct. 28, said Robert Vincent, litigation counsel for the KCC.
Vincent said the commission received more than 1,500 comments on the rate case.
Commissioners have broken off part of the case and ordered a separate proceeding on how much Westar can charge to provide service to the small number of customers who generate some of their own power with home solar panels.
Most solar customers are tapped into Westar power as backup when their panels aren’t generating enough electricity to meet their needs.
Solar advocates say they shouldn’t be penalized on their monthly service charge because they choose to generate some of their own electricity. They say the higher monthly service charges Westar has proposed would strangle the home solar energy industry.
Westar argues that higher monthly charges for solar customers are justified because it costs the company as much to serve them as it does regular customers, but Westar recovers less of that cost because it sells less electricity to the solar customers.
The company claims that results in regular customers carrying an unfair share of the cost of running the distribution system and, in essence, subsidizing the solar customers.
Reach Dion Lefler at 316-268-6527 or email@example.com.