PR-09-209 -- PSC Approves Agreement Reached In KCP&L Greater Missouri Operations Electric Rate Case

Contact: Gregg Ochoa (573) 522-2760

FOR IMMEDIATE RELEASE -- JUNE 10, 2009

Commission also approves agreement reached in steam case

JEFFERSON CITY---The Missouri Public Service Commission has approved an agreement which grants an electric rate increase for KCP&L Greater Missouri Operations Company. 

This agreement was reached by consumer advocates, the PSC staff and KCP&L Greater Missouri Operations Company and presented to the commission for approval.

 “The commission's decision reflects costs associated with providing safe and reliable service. The commission realizes that this is a significant increase, but all parties worked hard to reach a compromise that is in the public's best interest," said PSC Chairman Robert M. Clayton III.

Under the agreement, KCP&L Greater Missouri Operations Company will receive an electric rate increase of approximately $48 million for its operations serving the territory it formerly served as Aquila Networks-MPS (MPS) and approximately $15 million for its operations serving the territory it formerly served as Aquila Networks-L&P (L&P).  The rate increase will take effect for service on and after September 1, 2009. 

For a typical residential customer near Kansas City (MPS), the PSC staff estimates the increase will be approximately $109.68 a year or approximately $9.13 a month (10.46%).  For a typical residential customer near St. Joseph (L&P), the PSC staff estimates the increase will be approximately $102.93 a year or about $8.58 a month (11.85%).

When KCP&L Greater Missouri Operations Company filed its rate request with the Missouri Public Service Commission on September 5, 2008, it sought to increase annual electric operating revenues by approximately $66 million for its operations serving the territory it formerly served as Aquila Networks-MPS (MPS) and by approximately $17.1 million for its operations serving the territory it formerly served as Aquila Networks-L&P (L&P). 

KCP&L Greater Missouri Operations Company serves approximately 308,000 electric customers in Missouri.

Steam Case

Also presented to the commission and approved was an agreement reached between the PSC staff, the Office of the Public Counsel, KCP&L Greater Missouri Operations Company and Ag Processing, Inc. which grants an increase in annual base rate steam operating revenues of approximately $384,000 effective July 1, 2009.  KCP&L Greater Missouri Operations Company serves five steam customers in the St. Joseph, Missouri area. 

The agreement continues a fuel adjustment mechanism first established in February 2006.  The fuel adjustment mechanism allows KCP&L Greater Missouri Operations Company to file new steam rates quarterly.  Rates can increase or decrease based upon KCP&L Greater Missouri Operations Company’s actual fuel costs for that quarter.  The adjustment (up or down) in rates will reflect changes in KCP&L Greater Missouri Operations Company’s fuel costs (coal and natural gas) above or below the base amount set in this rate case of approximately $3.95 per million BTU.

Under the agreement, KCP&L Greater Missouri Operations Company retains 15% of the difference between actual fuel costs and base fuel costs when the actual fuel costs are below the base costs.  But if actual fuel costs exceed base fuel costs, KCP&L Greater Missouri Operations Company will be allowed to recover only 85% of the difference.  In addition, the agreement continues reviews of those costs to ensure that they are prudently incurred. 

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Case Nos. ER-2009-0090 & HR-2009-0092