Kansas
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Citizens' Utility Ratepayer Board (CURB)

Utility Consumer Alert

July 16, 2004

Aquila (WestPlains) Electricity Prices at Record Level

The Citizens' Utility Ratepayer Board (CURB) issues this "Utility Consumer Alert" to electricity customers of Aquila, formerly WestPlains Electric Company. Aquila's electricity rate for residential customers this month (July 2004) currently is in excess of 11 cents per kilowatt hour (kwh).

"Consumers who receive electric service from Aquila need to be aware of these extraordinarily high electricity rates and adjust their electric usage accordingly," said David Springe, Consumer Counsel for CURB. "Unfortunately, consumers don't know what price they are paying for electricity until their bill shows up in the mail. At that point it's too late to adjust your thermostat to reduce your electric usage. The size of these electric bills may come as a shock to most consumers."

Aquila's summer electric rates include a $7.50 monthly customer charge, a volumetric charge of 7.012 cents per kwh used, plus Aquila's July monthly fuel cost adjustment (ECA) of 4.04 cents per kwh used. The average residential customer uses 750 kwh a month over the course of a year. However, monthly kwh usage increases in the hot summer months as air conditioning usage increases. Consumers can conserve energy in the summer and lower their utility bills by adjusting their thermostat to a higher level, checking windows to make sure they close properly, increasing insulation and caulking and having air conditioners professionally checked to make sure they are operating efficiently.

CURB, in conjunction with other consumer representatives, has filed a motion with the Kansas Corporation Commission to open an investigation into Aquila's monthly fuel cost adjustment to insure that consumers are not being charged inappropriate rates. The monthly fuel cost adjustment allows Aquila to recover the costs of purchasing power to supply its customers, and the cost of purchasing fuel to run its electric generators. The fuel cost adjustment changes monthly, but has never reached the 4 cent per kwh level that Aquila's customers are being asked to pay this month.

"Given Aquila's recent financial difficulties, we believe that it is entirely appropriate for the Kansas Corporation Commission to conduct an in-depth review of Aquila's purchasing practices and fuel costs. Aquila's current electric rates are now some of the highest in Kansas," said Springe.

Aquila has also filed a separate application with the Kansas Corporation Commission to increase consumer rates by $19 million annually, which represents a 27% increase in Aquila's monthly customer charge and volumetric rates (KCC Docket No. 04-AQLE-1065-RTS). This increase is in addition to the rates consumers are currently being charged. One controversial aspect of the case is a request by Aquila to recover from residential and small commercial customers approximately $5.0 million in annual losses on contracts with two large industrial customers. Aquila has also asked the Kansas Corporation Commission to implement an immediate $10.0 million interim rate increase.

If approved by the Kansas Corporation Commission, consumers would be charged this interim increase during the period the Commission is considering Aquila's full rate request. CURB is actively representing Aquila's residential and small commercial customers in these cases.

Aquila provides electric service to approximately 69,000 customers in over 150 communities in Southwest and North-central Kansas, including Caldwell, Concordia, Dodge City, Downs, Ellsworth, Fowler, Great Bend, Harper, Liberal, Medicine Lodge, Minneola, Ness City, Phillipsburg, Plains, Plainville, Smith Center, Spearville and Sublette.

CURB is a five member volunteer Board appointed by the Governor to act as the voice of consumers in utility proceedings in Kansas. CURB, through its Office of Consumer Counsel, advocates for the interests of residential and small commercial utility customers before the Kansas Corporation Commission and the Kansas Courts. For more information about CURB, visit the CURB website at http://curb.kcc.state.ks.us/, or call the Consumer Counsel, David Springe, at 785-271-3200.