Recovery of Deferred Natural Gas Fuel Costs from February 2021 Winter Storm
February 22, 2023
Deferred natural gas fuel costs from the February 2021 Winter Storm Uri are now or will soon be appearing on monthly utility bills from nearly every Kansas electric and natural gas public utility. In February 2021, prolonged frigid weather caused record demand for natural gas and electricity. At the same time, natural gas production declined which created supply shortages. Due to supply shortages, wholesale natural gas prices spiked hundreds of times higher than normal. Kansas was not alone in facing these natural gas price increases, which affected both electric utility and natural gas utility energy costs. Large parts of the central and southern United States experienced the extremely high energy prices during Winter Storm Uri. Natural gas prices are not regulated by the Kansas Corporation Commission or any other government entity, but rather, are market driven by supply and demand. However, there are investigations currently underway at the State and Federal level to determine whether the peak prices during February 2021 were the result of market manipulation, price gouging, etc. Any proceeds recovered as a result of these investigations will be passed back to utility customers. CURB has compiled information on Kansas utilities’ recovery processes for the extraordinary costs associated with the February 2021 winter storm.
Black Hills Energy
(KCC Docket No.: 21-BHCG-334-GIG)
Black Hills Energy implemented a “Storm Uri Gas Charge” of $0.204557 per therm for residential customers, effective February 1, 2022. The average residential customer can expect an approximate $11.47 monthly bill increase for five years. The charge will be adjusted annually, each January 31.
Kansas Gas Service
(KCC Docket Nos. 21-KGSG-332-GIG & 22-KGSG-466-TAR)
Kansas Gas Service implemented a flat “Winter Event Securitized Cost” charge of $5.64/mo. to residential customers, effective December 1, 2022. This charge will not vary based upon usage. The charge is designed to last 10 years. The charge will be adjusted at least twice per year, depending on the amount of collection.
(KCC Docket Nos.: 21-ATMG-333-GIG & 22-ATMG-538-TAR)
Atmos has been approved to utilize securitization to finance its extraordinary costs. Atmos has not yet issued Securitized Utility Tariff Bonds.
Evergy Kansas Central
(KCC Docket No.: 21-EKME-329-GIE)
The average Evergy Kansas Central residential customer will experience a monthly bill increase of approximately $2.82 for two years, beginning in April 2023. There will not be a line item charge. Rather, this cost will be reflected in the fuel charge.
Evergy Kansas Metro
(KCC Docket No.: 21-EKME-329-GIE)
Evergy Kansas Metro was able to sell excess power back to the Southwest Power Pool during the storm, to the benefit of its customers. The average Evergy Kansas Metro residential customer will experience a monthly bill credit of approximately $6.60 for one year, beginning in April 2023. There will not be a line item charge. Rather, this credit will be reflected in the fuel charge.
Southern Pioneer Electric
(KCC Docket No. 21-SPEE-331-GIE)
Southern Pioneer’s Storm Uri Recovery Charge was approved in March 2022. Each customer’s charge is calculated based their usage during February 2021. The average Southern Pioneer residential customer will experience a monthly bill increase of approximately $7.89 per month for 36 months.
(KCC Docket No.: 21-EPDE-330-GIE)
Liberty-Empire submitted its financial plan to the Commission on November 23, 2022. The proposal is still under review.