AARP Kansas is calling on customers of Kansas City Power and Light (KCPL) to speak out to the Kansas Corporation Commission (KCC) which is considering a proposal to make customers pay $7.6 million in legal and consulting costs spent by KCPL. KCPL racked up these fees as it made its case to raise customer rates by $22 million. AARP believes that these costs are excessive and should be paid for by the company, not its customers.
Historically, utility companies have been allowed to charge customers the reasonable costs of preparing for and being a part of rate hearings which are held by regulatory bodies like the KCC which must approve utility rates. In addition to paying for outside consultants and lawyers that the utility may need, some of the regulatory costs help pay for the Citizens’ Utility Ratepayer Board (CURB), which represents residential and small commercial customers, and some pay for the KCC staff and commissioners.
In its recent rate case, KCPL proposed charging customers $2 million in regulatory costs. However, now that the case is over, KCPL is asking the KCC to allow it to charge customers $9.1 million in regulatory expense. Evidence in the case shows that KCPL spent $7.6 million hiring 40 outside lawyers, 45 consultants and spending almost 25,000 man hours working to convince the KCC that ratepayers should pay for hundreds of millions of dollars of cost overruns spent building the Iatan II coal plant. KCPL hired the best help money can buy to help convince the KCC… and it won.
“The problem is, KCPL opened the customer’s checkbook and took out a blank check,” said AARP Kansas State Director Maren Turner. “We certainly understand there are expenses in having a rate hearing but as long as KCPL is allowed to pass any and all costs on, whether justified or not, the sky’s the limit as to how much they will spend to get the biggest rate increase they can.” Turner added, “it’s unbelievable that the KCC has no policy that limits how much a utility can spend on a rate hearing and expect to get back from customers.”
Turner said the KCC needs to hear from Kansans about KCPL’s excessive legal and consulting expenses being unfairly shouldered by its customers. She encourages customers to call the KCC at 1-800-662-0027 and urge them to stop giving KCPL a blank check to pay for rate increase hearings. Kansans can send an email telling the KCC to stop giving the utility a blank check at firstname.lastname@example.org. (Reference KCC Docket No. 10-KCPE-415-RTS)
For more information, visit the AARP KS web site.