September 19, 2019

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Evergy Proposes Energy Resource Plan

Evergy, Inc. (Evergy), the new parent company of Westar Energy, Inc. (Westar) and Kansas City Power & Light Company (KCP&L), along with the Staff of the Kansas Corporation Commission (KCC or Commission) and the Citizens’ Utility Ratepayer Board (CURB) made a compliance filing outlining a new process for filing forward-looking capital expenditure plans and Integrated Resource Plans (IRPs).  

Capital Plan Report 

First, the joint proposal by Evergy, KCC staff, and CURB would have Evergy file a Capital Plan Report on February 28 of each year. The Capital Plan Report would include the following: 

  • Summary of Evergy’s projected capital investments over a five-year period

  • Detailed breakdown of its projected capital investments over the next year

  • Comparison of the prior year projections versus actual investments over that time period  

Interested parties will have an opportunity to review the Capital Plan Report and identify any concerns regarding the Capital Plan. While the proposed framework calls for the Commission to issue an order on each Capital Plan Report, such order will not constitute approval or rejection of the Capital Plan. In other words, ultimate approval of the costs incurred by Evergy’s operating utilities will still be determined in backwards-looking, traditional rate cases. 

Integrated Resource Plan 

Second, the joint proposal would have Evergy make an IRP filing every three years, with annual updates in the intervening years. The initial IRP filing would be made on July 1, 2020 with future triennial filings made three months after each subsequent Missouri IRP filing. The purpose of the IRP filings is to present the utility’s preferred portfolio of resources. Under the proposal, Evergy would submit the following: 

  • Demand and supply forecasts based on near-term expectations

  • Demand and supply forecasts based on medium-run forecasts (i.e. 10-15 years out), with a baseline case and alternative scenario analysis including the following:

    • Increased use of distributed generation

    • Rapid increase in the use of electric vehicles

    • Energy efficiency adoption

    • Macroeconomic fluctuations

    • Changes in regulatory requirements

    • Changes in technology (including wind, solar, energy efficiency and energy storage) 

    While the joint proposal includes a process for interested parties to review and comment on the IRP filing, there is no deadline for the Commission to make a determination on the IRP filing or specifically approve the preferred resource plan. 

    The proposed framework summarized above is subject to review and approval by the KCC. The compliance filing was made on March 1, 2019, but due to error, was not served on parties to the Westar/KCP&L merger docket until March 27, 2019. Interested parties typically may respond to filings at the Commission within 10 days, but will likely be granted additional time to respond to this compliance filing due to the error in service. Whether any parties file responses and how the Commission rules on the proposed framework will be worth monitoring, as it could impact the operations of the region’s dominant public utility company.

    © Polsinelli PC, Polsinelli LLP in California

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    About this Author

    Frank Caro Polsinelli Shareholder Kansas
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    Frank Caro serves his energy, utility and telecommunications industry clients as a partner in meeting their legal challenges, as well as a trusted resource for strategies that are built on his vast experience in business, regulatory and government affairs.  

    As chair of the firm’s national energy group, Frank has been representing clients in the electric, gas and telecommunications industries for more than 25 years, during which time he has assisted in structuring complex business, regulatory and legislative solutions to his clients’ most challenging legal problems.  

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    Andrew O. Schulte Associate Polsinelli Energy Industry  Regulatory
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    Andrew Schulte guides energy industry clients through the complex and dynamic regulatory environments at the local, state, and federal levels. Andrew has significant experience with matters set for hearing before regulatory bodies, including preparing filings and testimony, negotiating multi-party settlements, managing discovery, presenting oral arguments, cross-examining expert witnesses, and drafting motions and briefs for presentation to regulatory decision-makers.

    As former counsel to both the Kansas Corporation Commission and the Federal Energy Regulatory Commission, Andrew uses his understanding of the legal, procedural, and political issues at play in regulatory proceedings to help clients achieve their business goals. He also counsels clients on energy-related transactions, including the acquisition of energy assets and the negotiation of power purchase agreements. Andrew has conducted due diligence, drafted and reviewed contracts for the transfer of interests in electric generation projects, and obtained the necessary regulatory approvals for such transactions. 

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