photo by: Associated Press

The Lawrence Energy Center produces power behind Shirks Barn near Lawrence, Kan., Tuesday, Feb. 16, 2021. (AP Photo/Orlin Wagner)

Lawrence customers of the electric utility Evergy will start paying more on their monthly bills to account for costs related to the 2021 arctic blast that struck the region, state regulators decided Thursday.

Kansas City customers of Evergy, however, will start getting a credit on their bills, also related to the February 2021 winter storm, the Kansas Corporation Commission ordered.

Evergy customers in Lawrence — and in all other Evergy territories outside of the Kansas City metro area — will begin paying an extra $2.82 per month on their residential bills for the next two years, the KCC ordered on Thursday. Evergy customers in the Kansas City metro area will receive a $6.60 per month credit on their monthly bills for the next year, the regulators determined.

The Journal-World reported in February that Evergy — which used to be Westar Energy and Kansas City Power & Light — had asked the KCC to approve the new rates in order to cover unexpected costs the utility incurred to keep power plants operating during the severe winter weather in February 2021.

The KCC, which regulates the rates of public utilities, agreed on Thursday that the extraordinary costs Evegy incurred were reasonable and could be passed on to at least a portion of the utility’s customers.

The rate case, however, was unusual because it treats Evergy customers differently depending on where they live, despite the fact that the 2021 winter storm created similar weather problems throughout all of Evergy’s territory.

Evergy and KCC officials previously have explained that’s because Evergy’s power plants that serve the Kansas City metro area made enough excess electricity during the arctic blast, and were able to sell that electricity at high enough rates to other power-starved utilities, that Evergy made more money off those plants than they normally would have made during that period. Since utilities are regulated entities, Evergy can’t simply pocket those unexpected profits. Instead, regulators will require that they be shared with utility customers.

But not all of Evergy’s customers are entitled to have those unexpected profits rebated to them. That’s because Evergy is basically a combination of two older electric utilities — Westar Energy and Kansas City Power & Light. As a result, there are still rates and cost structures that exist for the old Westar territory — which includes Lawrence — that are different than the rates and cost structures that exist for the old KCP&L territory in Kansas City, a spokeswoman with Evergy previously said.

In the case of this arctic blast, the cost structure in the old KCP&L territory performed better than the old Westar structure, likely because the KCP&L plants are less reliant on natural gas as a fuel source.

The KCC heard objections to Evergy’s rate proposal but ultimately dismissed them. Kansas Industrial Consumers, the Natural Gas Transportation Customer Coalition, and Coffeyville Resources Refining & Marketing LLC opposed the plan, claiming it unjustly shifts costs from residential customers to industrial customers and fails to reward conservation efforts, the KCC said in a press release.

The KCC staff and the Citizens Utility Ratepayer Board, which aims to protect the interests of residential and small business ratepayers, supported the Evergy plan, according to the KCC press release.

The February 2021 winter storm produced a two-week cold snap. Most of the attention from the storm has been on how natural gas prices hit historic highs. In some cases, natural gas prices were so high that gas utilities were paying in one month what they normally would spend on gas for four years.

Indeed, Lawrence residents are seeing much higher increases to their natural gas bills to compensate natural gas utilities for their unexpected costs during the winter storm. The KCC previously approved a plan that adds $11.47 per month to the natural gas bills of customers of Black Hills Energy for the next five years.

However, those higher natural gas prices also sparked increased electric costs, since many power plants use natural gas to produce electricity.