Staffers initially clashed with a consortium of Evergy and environmental and consumer groups about the amount of money the utility could recoup
Kansas regulators approved a robust set of energy efficiency programs for Evergy customers after concerns the deal might fall apart.
The 2-1 vote by the Kansas Corporation Commission on Friday brings programs, such as rebates and discounts on efficient HVAC systems and free thermostats, to Evergy’s Kansas customers. Missouri regulators have allowed energy efficiency programs for years.
Chair Susan Duffy said in a special meeting of the commission that she was disappointed it took so long for Kansas to pursue energy efficiency, but she and her colleagues put significant thought into the decision.
“At this point, we need to jumpstart energy efficiency, not lackadaisical, leisurely, slow implementation,” Duffy said.
Formed in 2018 from the merger of Kansas City Power & Light and Westar, Evergy serves more than 1.6 million customers in Kansas and Missouri.
Evergy filed a request in December 2021 to implement a suite of energy efficiency programs, and public meetings showed significant support from customers hoping to lower their emissions — and their electric bills.
But staff of the Kansas Corporation Commission objected to earnings the company would make on the programs. Proceedings were delayed repeatedly as the company, regulators, and environmental and consumer advocates tried to work out a deal.
Evergy spokeswoman Courtney Lewis said in an email Friday that the company was pleased with the KCC’s decision.
“The KCC acknowledged the overwhelming customer support and interest in energy-saving incentives and programs that allow customers to take greater control of their energy usage and costs,” Lewis said. “We look forward to introducing energy efficiency programs to our Kansas residential and business customers.”
Commissioner Andrew French said on Friday ahead of the vote that the commission, in recent years, “has made some pretty enormous strides to drag our state out of the past and into a more advanced posture toward energy and utility issues.”
Kansas currently ranks 49th out of the 50 states and the District of Columbia for its energy efficiency programs by the American Council for an Energy-Efficient Economy. It fell from 47th while Evergy’s request was pending with the KCC.
“Today’s order is just one more consequential step that will be followed by more to make sure Kansas is leading rather than left behind in the energy arena,” French said.
Friday’s order would allow Evergy to implement nine energy efficiency programs for residential and commercial customers with some conditions imposed by the Kansas Corporation Commission.
Most significantly, the commission’s order would trim the amount of money Evergy would be allowed to recoup from customers to pay for the program compared to what the company requested.
One commissioner said the company would still be allowed some of the highest earnings on an energy efficiency program in the country.
The amount Evergy would be allowed to recoup was a primary concern for Commissioner Dwight Keen, who dissented from the order.
“Two important facets of the settlements approved today by the commission, in my opinion, provide unnecessary, excessive and flawed revenue benefits to Evergy shareholders at the expense of Evergy ratepayers,” Keen said.
Dave Nickel, consumer counsel for the Citizens’ Utility Ratepayer Board, said he was glad to see the parties had reached an agreement on the programs.
CURB, which represents residential and small business utility customers, he said, analyzed the program and found it would “provide real savings” to customers.
Utility experts and environmental groups call energy efficiency the “least cost resource.” By reducing the load on the electric grid, utilities can avoid having to build more and more power generators, such as solar and wind farms or coal and gas plants. In the long run, that means cheaper power.
Zack Pistora, a lobbyist for the Kansas chapter of the nonprofit Sierra Club, said in a statement the organization was “delighted” by the decision.
“This new effort in Kansas should save a significant portion of energy every year, and that’s going to benefit all Kansans, let alone those struggling with their bills already,” Pistora said.
Ashok Gupta, senior energy economist for the Natural Resources Defense Council, said he was “surprised and pleased” by the KCC order. The commission took so long to reach a decision, he said, it made proponents “extremely anxious and nervous” that they wouldn’t approve a favorable energy efficiency program.
“These investments are incredibly beneficial for consumers,” Gupta said. “It’s good for reliability. It’s good for the environment.”
Programs included in Friday’s order are:
- Free energy assessments, discounted energy savings kits, and discounts, financing and rebates for energy efficient HVAC systems and other upgrades
- Energy efficiency education for rural and low-income families
- Free assessments and upgrades for low-income and rural households or “hard-to-reach homes”
- Free thermostats and water heater controllers to lower customers’ usage during periods of peak demand, such as hot summer days
- Incentives for businesses to upgrade buildings and use energy efficient equipment
- Education for businesses
- Incentives for small businesses and nonprofit organizations
- Assistance for business customers to reduce their power demand during peak times
- A pilot program for future demand management and energy efficiency programs
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