KPP Energy, the City of Winfield’s energy supplier, announced this week that it has recovered all costs of the Winter Storm Uri — over $21 million in total.
According to Winfield City Manager Taggart Wall Tuesday, the supplier announced an immediate surcharge after the February 2021 storm that was applied to member utilities and was planned for no less than 24 months or until the costs were fully recovered.
“This is separate from the City of Winfield’s natural gas utility recovery of Winter Storm Uri costs —which is scheduled to end in 2025,” Wall said. “As reviewed in August 2022 and communicated in a letter mailed to Winfield Utility customers last October, the City has been preparing for a restructure of electric rates in 2023.”
The storm hit Cowley County with nearly a half-foot of snow in places and high temperatures below freezing for 12 straight days starting Feb. 7 with a majority of those days recording single-digit highs, subzero lows and wind chills anywhere from -15 to -35.
Tuesday Wall said the combination of those conditions shocked markets that were felt long after the storm.
“In 2022, customers experienced higher than normal energy rates being passed along to them primarily due to changes in prices on electric markets including high natural gas pricing affecting generation input costs, less available coal resources in the U.S. to push back against those higher natural gas prices and remaining costs from Winter Storm Uri,” Wall said.
Wall said markets have since eased.
“Indeed, we have seen that wholesale energy markets stabilize and KPP Energy, the City’s energy supplier, announced this week that Winter Storm Uri costs have been fully recovered beginning in September,” he said. “These changes allow us to move forward with the planned rate restructuring which is aimed at creating more balanced billings for customers and increasing the financial ability of the system to replace assets and slow down the rate of depreciation.”
Residential and small business customers have already seen a decrease in total electric costs of over 35% since June of this year, Wall said, and because of that, the drop off of KPP storm surcharges to the City and thus customers will not translate to a major difference in the equation regarding that aspect of billing.
“Due to the City’s strategic approach on waiting for the right time to implement the restructure, as the Winter Storm Uri Charges drop off, the impact on this customer class by the planned restructure is less than a 1% increase,” Wall said. “Larger industrial customers will see incremental increases in costs.”
The rate restructure will face final review in September with an October 1 implementation planned.
