FOR IMMEDIATE RELEASE -- January 14, 2021
Contact: Kevin Kelly (573) 751-9300
PSC Grants Evergy Request for an AAO
JEFFERSON CITY---The Missouri Public Service Commission has granted an Accounting Authority Order (AAO) to Evergy Metro, Inc. d/b/a Evergy Missouri Metro and Evergy Missouri West, Inc. d/b/a Evergy Missouri West (Evergy) which sought the AAO to govern costs and financial impacts associated with the COVID-19 pandemic. An AAO will allow Evergy to defer such costs in a regulatory asset, beginning on March 1, 2020, less costs avoided also related to COVID-19.
“The Commission will grant an AAO to allow Evergy to defer, in a regulatory asset, specified costs associated with the COVID-19 pandemic netted against specified savings, also associated with the pandemic,” said the Commission. “The Commission finds the categories of costs proposed for deferral are closely related to the pandemic as they are expenses incurred to protect employees and offer some assistance to customers during the pandemic.”
A Commission decision to allow an AAO does not guarantee deferred items will be included in rates in a future ratemaking case. Evergy can seek recovery of deferred costs in a future rate case.
Through the use of a regulatory asset or liability, an AAO may permit or require a company to defer items from one period to a subsequent period. The deferred items may be reflected in rates set in a future rate case. The ratemaking process is designed to allow for recovery from customers, prudently incurred expenses necessary to provide service.
The Commission’s established standard provides that an AAO may be appropriate when events occur that are extraordinary, unusual and unique, and not recurring. “The Commission finds the COVID-19 pandemic is such an extraordinary, unusual and unique and not recurring event, which has had a demonstrated impact on Evergy’s operations. Therefore, the Commission finds costs and savings directly associated with the pandemic are eligible for deferral under an AAO so that they can be considered in a future rate case,” said the Commission.
In this case, Evergy withdrew requests to defer lost revenue or lost fixed costs. Likewise, Evergy no longer requested that an AAO address carrying costs. Therefore, those items will be excluded from an AAO.
Evergy Missouri Metro provides electric service to approximately 292,700 customers in the Missouri counties of Carroll, Cass, Chariton, Clay, Howard, Jackson, Johnson, Lafayette, Livingston, Pettis, Platte, Randolph and Saline. Evergy Missouri West provides electric service to approximately 347,400 customers in the Missouri counties of Andrew, Atchison, Barton, Bates, Benton, Buchanan, Carroll, Cass, Cedar, Clay, Clinton, Dade, Daviess, DeKalb, Gentry, Grundy, Harrison, Henry, Holt, Jackson, Johnson, Lafayette, Livingston, Mercer, Nodaway, Pettis, Platte, Ray, St. Clair, Vernon and Worth.