The Joplin Globe, Joplin, MO

Joplin Metro

Discussion

February 9, 2010

Kansas customers present opposition to proposed Empire rate increase

By Roger McKinney

rmckinney@joplinglobe.com

BAXTER SPRINGS, Kan. — About 100 residents turned out Tuesday night to protest Empire District Electric Co.’s proposed increase in the rates for its Kansas customers.

The Kansas Corporation Commission staged a public hearing at the Baxter Springs Community Center.

Empire is seeking a $5.2 million, or 25 percent, increase in annual revenues from its 10,102 Kansas customers. It is the Joplin, Mo., utility’s first rate increase proposal in Kansas since 2005.

Empire officials say the proposal would result in a 27 percent increase in the monthly bill for a residential customer in Kansas who uses 1,000 kilowatt-hours of electricity. That customer’s bill would increase by $25.09 a month, to $118.31, if the rate increase is approved.

The utility is seeking the rate increase to recover its costs from investments, including a new coal-fired power plant in the Kansas City area and environmental improvements to another plant there. Also included are a natural gas turbine in Riverton that began operating in 2007 and upgrades to a coal-fired power plant at Asbury, Mo.

Jim Flaherty, an attorney representing Empire, said the utility’s Kansas customers represent 5.4 percent of its revenues and costs.

One resident asked why Empire is seeking a higher percentage rate increase from its Kansas customers than it is from its Missouri customers. Empire’s Missouri rate case seeks a 20 percent increase.

Bill Gipson, Empire’s president and chief executive officer, said Missouri customers already are paying higher rates for the natural gas turbine at Riverton and the improvements at Asbury.

“Our Missouri customers are already paying for those investments,” Gipson said.

Sue Gast, an owner of Angels on the Route in Baxter Springs, said small-business owners can’t endure more hardship.

“You might as well put us all out of business,” she said. She said the increased electric rates won’t be reflected only on utility bills, but also in the price of a gallon of milk and other products, and in property taxes the city charges.

Mel Green, co-owner of the Maple UnCommon Hotel in Columbus, echoed Gast’s statement.

“I can’t afford an increase,” Green said, noting that he is relying on Social Security income to get by. “We’re asking you not to let this increase pass.”

Carol French asked the KCC to consider senior citizens and the unemployment rate.

“They can’t afford this,” French said of senior citizens. “We can’t afford this.”

Baxter Springs resident Charlene Hunley read a letter from Baxter Springs Mayor Huey York, who was presiding over a City Council meeting Tuesday night. York’s letter said the increase would boost the city’s annual electric costs by $64,000.

Niki Christopher, staff attorney for the Citizens’ Utility Ratepayers Board, told those in the audience that she probably would be back in about a year, because she expects the utility to file another rate increase after this one is approved. The agency advocates for residential and small-business utility customers.

“We believe the return on equity that Empire is requesting is too high,” Christopher said. “We’ve looked very carefully to ensure that Kansas customers are paying for Kansas costs.”





Decision time



The Kansas Corporation Commission is expected to act on the Empire District Electric Co. rate case sometime this summer.

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