Archive for Saturday, December 1, 2001

Agency upholds rate differences in state utilities

December 1, 2001

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— A federal agency has rejected efforts by Wichita officials to equalize electric rates paid by Western Resources Inc. customers in northeast and southeast Kansas.

A lawyer for a coalition of cities served by Western's KPL subsidiary called the ruling a victory for northeast Kansas ratepayers. A spokeswoman for the city of Wichita expressed disappointment.

The ruling by the Federal Energy Regulatory Commission, dated last week and received in Kansas on Wednesday, upholds an administrative judge's earlier rejection of Wichita's demand for rate equalization.

Currently, Wichita-area consumers of Western Resources' KGE subsidiary pay between 13 percent and 20 percent more for power than consumers in Topeka and northeast Kansas, who are served by Western's KPL division.

The disparity stems from the costs of building the Wolf Creek nuclear power plant. KGE helped build the $3 billion plant in the 1980s before it merged with KPL in 1992 to form Western Resources.

In its FERC complaint, Wichita said that since the utilities are now operated jointly, Wolf Creek's costs should be spread among all of Western's customers.

But Topeka and its coalition partners, which include Lawrence, Emporia, Manhattan, Junction City and Olathe, argued that KPL ratepayers were assured at the time of the merger that they wouldn't have to help pay for Wolf Creek.

FERC's order acknowledged that promises were made to KPL customers. The agency said it wanted to ensure that "commitments regarding responsibility for KGE's portion of the fixed costs of Wolf Creek are not disturbed."

"This is a major victory for the KPL area," said John Frieden, attorney for the coalition. "I would hope that the Kansas Corporation Commission would follow the reasoning of the Federal Energy Regulatory Commission."

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