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Evergy Files Rate Review to Recover Costs to Modernize Grid, Improve Reliability and Enhance Customer Service

Jan. 11, 2022
Ongoing savings from 2018 merger exceed projections, reduce the rate increase request by more than half.

Evergy has submitted a detailed rate review to the Missouri Public Service Commission (MPSC). The requested rate adjustment reflects investments to improve reliability, enhance customer service and enable the company’s transition to cleaner energy resources.

Missouri law requires Evergy to file a rate review to update rates at least once every four years. If approved, this will be the first base rate increase for Evergy Missouri customers in more than five years. In recent years, Evergy has reduced operating costs and is passing savings on to customers in this rate review at levels greater than projected at the time of the merger. Including the current rate review request, throughout the last decade Evergy Missouri customers have experienced price increases that are well under the average annual rate of inflation for the same time period.

For Evergy Missouri Metro customers, the company is requesting approximately a 5.2% increase to its base rates. For Evergy Missouri West customers, the company is requesting approximately a 3.85% increase in base rates. The prices customers pay for electric service are calculated based on actual costs the company incurs. The filing today begins an 11-month process where regulators and interveners will review, audit and evaluate the request to assure the resulting prices reflect the cost of serving Evergy’s Missouri customers. The process will include public hearings, which are yet to be scheduled. To justify any price increase, Evergy must demonstrate that the costs were warranted and prudent. For more information on Evergy’s service areas, click here.

“Since Evergy was formed in 2018, reducing operational costs to help fund our investments and make our rates more competitive has been one of our primary goals,” said David Campbell, president and chief executive officer, Evergy. “We’ve exceeded our merger savings targets and are passing on those savings to customers as promised. These savings have enabled us to avoid base rate increases for five years. This year we’re asking to adjust our rates to reflect and recover necessary investments we have made to enhance reliability and sustainability and better serve our customers.”

The most significant driver of the rate increase request is focused infrastructure improvement aimed at enhancing reliability. While Evergy has a track record of solid performance, as the electric system ages, modern upgrades are needed to maintain and improve reliability. For example, upgrades in advanced automation technologies will reduce restoration times during outage events, while recent enhancements in data analytics programs allow Evergy to better model potential outage risk areas and target investments and improvements accordingly.

“Our customers depend on the constant flow of electricity we provide. In this part of the country, it’s important that we continue to improve the grid, making it stronger and more resilient to limit power outages from severe weather, and be better protected against physical and cyber threats,” Campbell said. “This rate request includes investments to improve reliability, such as replacing aging electrical infrastructure with new technologies that speed restoration by automatically detecting power outages and quickly rerouting power to customers.”

Evergy’s requested rate review also seeks to address customer interest in cleaner energy sources and more choice in electric rate options. Today about half of Evergy’s energy comes from emission-free sources. As Evergy makes the transition to cleaner, more sustainable sources of energy, the company’s focus remains on advancing that transition at the appropriate pace to ensure reliability and affordability. For example, this rate review includes recovery of the costs to retire one of the company's older Missouri coal-fired power plants. In addition, Evergy is also asking to give customers more choices in their electric rates. Building on its successful time of use program, Evergy is seeking to introduce additional rate options, including expanding time of use options and a subscription pricing pilot, pre-payment options and other sustainable rate programs.

The COVID pandemic and resulting economic crisis created an urgent and unprecedented need for assistance. In 2020, Evergy donated $1.8 million for COVID relief efforts at no cost to Evergy’s customers. These donations were directed to 120 local agencies to help with emergency efforts, economic development programs, workforce training, and customer payment assistance. Evergy’s COVID relief effort was in addition to its annual $6.5 million in community support to hundreds of agencies throughout Evergy’s Missouri and Kansas service areas. Evergy’s community support donations are not included in customer rates.

With new COVID federal dollars available for rental and utility assistance, Evergy conducted approximately 500 outreach and social media events in 2020 and 2021 to connect and advise customers with bill assistance applications. Additionally, Evergy launched a one-stop location on its website with all assistance programs, links, helpful hints, and videos. Since 2020, these efforts have helped secure more than $67 million in utility bill payment assistance for Evergy customers.

In addition to the COVID relief efforts, Evergy continued to safely operate its customer walk-in facility, Evergy Connect. With health and safety protocols in place, Evergy provided assistance to customers in need through face-to-face service and virtual consultations. Since 2019, Evergy Connect has provided customized, direct service to more than 27,000 customers, including billing and payment assistance, energy-efficiency and weatherization tools and other resources.

Evergy is also asking the MPSC to continue reflecting fuel and purchased power increases and decreases in its Fuel Adjustment Clause (FAC) on customer bills. The FAC allows Evergy to adjust customers’ bills two times per year, up or down, based on actual costs of fuel and purchased power and is also reset following each rate review. As a result of substantially higher natural gas prices and power costs, Evergy is asking for an additional 0.45% increase for Evergy Missouri Metro customers and 4.46% for Evergy Missouri West customers in this rate review.

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