Evergy’s proposed electric rates leave some Kansans feeling ‘nickel and dimed’
Evergy proposed new electric rates earlier this month that will impact solar and potentially non-solar customers as well.
Arguing that solar customers aren’t paying their fair share to maintain transmission lines and the grid, Evergy proposed these new rates as an attempt to rectify the issue.
But solar industry leaders, green energy advocates and solar customers have criticized the proposed solar rates for discouraging solar and changing the rules on customers who bought solar under a different set of rules and will no longer be grandfathered in on.
They’ve also accused Evergy of simply rebranding the solar fees ruled discriminatory earlier this year by the Kansas Supreme Court.
“We need the reliance of the power grid for right now and for the foreseeable future. It’s nothing against them,” said Seth Sullivan, manager of Encor Solar. “I was born in Kansas, raised in Kansas and this is where I’m going to die. Other than being in the solar industry, I’m just a Kansan and what I value is having the option and making sure that it’s a fair option.”
Mik Mikolajczk, a retired Air Force veteran, has been watching and researching the solar market for years and decided to take the plunge earlier this year.
“I’m a pretty aggressive guy. I do my research, I check things out, and I’ve always wanted solar. Now I felt was the time to do it,” Mikolajczyk said. “But Evergy appears to want to nickel and dime me.”
He spent $30,000 on solar panels for home and was waiting on them to be hooked up to Evergy when he got the news about the proposed solar rates.
“I spent 23 of my 25 years overseas in the military in Air Force Special Operations Command, and today I’m sitting back here and I’m not asking for a handout or hand up,” Mikolajczyk said. “I just want the decision to be just and fair across the board. I know we’re not going to get something free, but we don’t need to be paying the exorbitant prices with these fees.”
The Kansas Corporation Commission is accepting public comments on the proposal through 5 p.m. Dec. 21. Instructions on how to submit oral or written feedback can be found on its website, https://kcc.ks.gov/your-opinion-matters.
Evergy’s proposal is a two-part proposal, both of which would apply to all residential customers. Their first request and preferred solution is a new monthly fee for residential customers for $3 per kilowatt of installed distributed generation capacity, meaning the size of the solar array or other energy-producing systems, like a wind turbine, according to Gina Penzig, Evergy’s communication manager. The fee would be $0 for residents who don’t generate their electricity.
“Through studies of the cost of service and working with expert economists to study grid access...it was estimated that the fixed costs weren’t being recovered from those equated actually closer to about $6 per kilowatt of on-site generation,” Penzig said. “What we’ve proposed is about half that amount, in order to moderate the initial effect on customers who have their own generation.”
If the KCC rejects the first proposal, Evergy has also proposed a minimum bill of $35 for all residential customers, those with and without solar. Anyone who would have an electric bill that fell lower than $35 would have to pay $35.
“Through a cost of service study that had been performed, it’s been estimated that (for) all of the things behind the scenes to provide a customer service it’s about $77 per month per customer,” Penzig said. “$35 represents about half that cost.”
Evergy doesn’t have numbers for how many customers would be affected by their second proposal, the $35 minimum bill, according to Penzig.
“The minimum bill does have some different challenges with it and that you can have an unintended effect on, low use customers who may be low income,” Penzig said. “We don’t want to put customers in a position where they feel like they should use more energy without getting the benefit from it just to meet that $35.”
David Nickel, consumer counsel for the Citizens Utility Ratepayer Board, which advocates for Kansas consumers in utility matters, said he is concerned about the minimum bill’s impact on low-income customers. CURB is studying the rates now with a plan to respond to them in mid-November officially.
“We are going to look at both the grid access charge and the residential minimum bill, with a keen eye towards what are residential-class needs, as an overall class,” Nickel said. “We look for a solution that’s hopefully fair to both of our constituents.”
Opponents of the proposed rates have criticized them for being too similar to the demand charge that was ruled discriminatory by the Kansas Supreme Court.
“The only difference in this, then the demand charge that the Supreme Court ruled discriminatory, is that instead of charging $3 or $9 per kilowatt of demand, you’re charging $3 per kilowatt of installed DG capacity,” said Dorothy Barnett, executive director of the Climate and Energy Project in Kansas. “That is the only difference. So we believe it is still discriminatory.”
The plan to charge customers $3 for every installed kilowatt of electric generation is also criticized for not being equitable over time as the solar panels lose efficiency.
“They’re setting this fee on day one when the reality is that 15 years from now, the customer is paying a fee based on the brand new capacity of the system,” Horst said. “They don’t even have a system that will produce that much anymore.”
Mark Horst, owner, and manager of King Solar, a solar company, said that most of his solar customers are interested in solar because of the financial and environmental aspects.
“We see the rate structure that is being proposed that it will hurt small, efficient people worse than it will hurt well-to-do, inefficient people,” Horst said. “Our small customers, who they worked really hard to be energy efficient...they are getting hit harder than someone who doesn’t care and just wants to buy a big system.”
As electric rates have risen in Kansas over the last few decades, solar has become a more popular option in the state as it gives the consumer more choices, Sullivan said.
“From a strict fiscal standpoint, it still makes sense for a lot of people to go solar,” Sullivan said. “Even if you don’t have solar now, or if you’re in a home that you’re not really interested in or you’re renting, it just potentially makes the green energy option less viable or less attractive.”
One of the most significant incentives for green energy is that it costs homeowners less money and allows for a measure of self-reliance, according to Sullivan.
“No matter what side of the “aisle” you’re on, I just think people here in Kansas, self-reliance is something that we value,” Sullivan said. “Potentially, any extra charge is taking away that option.”
This story was originally published November 5, 2020 at 5:01 AM.
