It isn’t much of a surprise that Westar Energy officials are asking for a major rate increase even after hitting its customers with $265 million in rate increases since 2009.
These officials say the new request is based on the need to maintain a reliable system, comply with environmental regulations and keep its commitments to its employees.
Of the $91 million Wester is requesting, $37 million would go to help shore up the Westar employees’ pension fund, which was hurt by stock market losses. Is this something the utility’s ratepayers should be expected to cover or is this a cost Westar officials should figure out how to fund — IF they think it is necessary — by putting more of their reserves into the fund or perhaps asking employees to contribute more? Should ratepayers be expected to make up for a drop in the stock market or poor performances by those managing the pension fund’s stock portfolio?
It is understandable that expenses have gone up because of new government regulations and, to a lesser degree, the costs of an expanded tree-trimming program intended to help reduce power outages caused by fallen tree limbs. However, it seems questionable for Westar customers to be expected to cover the costs of a poor-performing pension fund. The situation is especially ironic in light of proposals to increase state employee contributions to the KPERS retirement fund and perhaps move that system to a 401k model.
It will be interesting to see how the Kansas Corporation Commission votes on the Westar increases, which could add $6.50, or 8 percent, to the average customer’s monthly bill.