City Of Wichita vs . Westar Energy
DATE: August 4, 2009
FOR IMMEDIATE RELEASE
CONTACT: Communications Team, 268-4351
Westar rate hike opposed by Wichita City Council
Past inequities not offset in proposalThe Wichita City Council voted Tuesday to file a formal protest against a proposed rate consolidation request by Westar Energy.The Council’s unanimous vote authorizes the filing of public comments and directs the City Attorney to intervene in the regulatory process currently underway with the Kansas Corporation Commission (KCC).Westar is asking the KCC to consolidate the electrical rates charged to customers in its two geographic territories identified as Westar North and Westar South. The City of Wichita is located in the Westar South territory.Currently, ratepayers in Westar South pay an average of 14 percent less than Westar North ratepayers, largely because the cost of energy generation at the Wolf Creek nuclear facility is less than generation costs at coal-fired facilities serving the North territory. The City Council issued a strongly worded reminder to the KCC that the Westar South territory suffered a much greater rate disparity of as much as 40 percent during the 17 years following the startup of the Wolf Creek facility. At that time, Wolf Creek construction costs and debt load were used to justify the higher rates charged to South customers. After a prolonged protest effort by the City of Wichita beginning in 1999, the KCC approved a rate reduction and refund for the South territory, but declined to end the rate disparity that penalized the South territory at the time. The City successfully argued that the Wolf Creek costs should be distributed across both territories because the electricity generated at the plant was dispatched company-wide.“If the KCC decides that consolidation should now proceed, it should do so cautiously, correct its prior errors and credit the customers in South for their overpayments of the past 17 years,” states the agenda report adopted by City Council on Tuesday. If the City of Wichita’s rate consolidation request been granted when first sought in1999, customers in the South territory would have saved hundreds of millions of dollars in electricity charges, according to the City Council report. “While consolidation may need to be the ultimate goal for the company’s two territories, as the City and others have forcefully argued in prior cases, it should only be done in a manner that is fair to all customers,” the report states. The City’s concern about the Westar action goes beyond the issue of consolidation, and extends to the various tariffs and riders that apply to different classes of customers and how Westar does business with those customers.The City of Wichita currently pays about $12 million annually to Westar for electricity used in residential, commercial, industrial and street lighting rate classes.
Dale Goter
City of Wichita
Government Relations Manager
13th Floor
455 N. Main
Wichita KS 67202
316-268-4351 (Office)
316-371-0134 (Mobile)
