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Westar standing by Kansas rate increase request

WICHITA, Kan. (AP) -- Officials from the largest electric utility in Kansas are vowing to press on with a request for $31.7 million in rate hikes for some customers across the state, including plans to modify rates for low-income customers.

Westar Energy Inc. is asking the Kansas Corporation to approve the request, which would shift the burden of rates away from larger, industrial customers. The Wichita Eagle (http://bit.ly/14VzuNM ) reports Monday that critics of Westar's request say the new proposals for low-income and new startup businesses would expand what is supposed to be a narrowly focused rate request.

Jeff Martin, Westar's vice president of regulatory affairs, said Westar wants the KCC to consider all items.

"We still believe that the time is right for a low-income assistance type of program," he said.

Westar is seeking the rate increase to pay for $1.2 billion in upgrades to satisfy Environmental Protection Agency regulations. Westar serves nearly 700,000 customers in eastern and central Kansas, including the cities of Topeka, Wichita and Pittsburg.

KCC staff filed a brief late last week raising legal objections to Westar's intention to provide some relief to new businesses and assistance for poor customers.

"Westar's proposed low-income assistance fund and economic development rider are outside the scope of the present abbreviated rate case proceeding and their inclusion should not be permitted," the KCC staff wrote.

David Springe, chief consumer counsel for Citizens' Utility Ratepayer Board, agrees with KCC about the timing of Westar's proposals.

The KCC will hold a hearing on Westar's request Sept. 26 and 27, with the three commissioners making a decision by Dec. 11.

According to Westar's request, residential customers would see their rates increase by about $7.50 a month, while small businesses would pay another $21.5 million overall. Medium-sized businesses would see their rates drop by about $18.5 million and large industrial users would pay about $17.4 million less.

Education and special contract customers also would get a break, paying about $49.1 million less.

Martin said the company's arguments in a filing with the KCC later this week. Those comments will be similar to testimony from Terrance Wilson, Westar's director of customer ad community relations.

Wilson wrote that the rate changes would help new customers move to Kansas and expand the customer base, but only if a government or economic development agency identified utility rates as an issue. Discounts would be short-term, but Westar sees the benefits as lasting.

Ray Bergmeier, the KCC's litigation counsel, said that Westar's plan wasn't detailed enough to determine if it could legally offer discounted rates.

"Westar's application is lacking information related to how the low-income assistance fund will be implemented, which customers will qualify, how much revenue those customers will receive, and whether those customers will receive benefits from this program in the form of reduction to their bills or credits to their accounts," he wrote.

Wilson has said that Westar wouldn't be offering reduced rates for low-income customers but would provide assistance in paying their bills, a practice he said the KCC has previously approved.

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Information from: The Wichita (Kan.) Eagle, http://www.kansas.com