Black Hills Energy reached an agreement with the Kansas Corporation Commission and Citizens’ Utility Ratepayer Board for increases to customers’ rates. (Getty Images)
Black Hills Energy customers could have to pay another $14.50 per month under two separate rate hikes the company has proposed to Kansas regulators.
The natural gas utility, which serves more than 117,000 Kansas customers in 50 counties, filed in May with the Kansas Corporation Commission for a $10.2 million increase to customers’ base rates — offset by a $4.9 million reduction in surcharges. Under the proposal, the average customer would pay another $2.27 per month, an increase of 4.5%, according to the KCC, which announced on Wednesday it had scheduled a public hearing on the subject for Aug. 4.
In testimony filed with the KCC, Thomas Stevens, who is responsible for Black Hills’ regulatory affairs said the company needed to increase rates because of “capital investments Black Hills has made over the last seven years to provide safe and reliable service to Kansas customers.”
He said the company’s management of expenses lessened the need for a larger rate hike. The “revenue deficiency” is also offset by reductions in both state and federal taxes for the company.
In a statement, Black Hills Energy Kansas’ general manager, Jerry Watkins, said the utility had kept costs for customers flat for several years.
Black Hills also requested in June to increase customers’ rates for five years to pay for extraordinary natural gas costs it incurred in February when sustained freezing temperatures forced electrical outages and caused natural gas prices to spike. Natural gas utilities have been asked by KCC to file plans to recover the costs from customers.
If Black Hills recovered it all in one year, it said in filings, it would nearly double customers’ bills. The company, the first large gas utility to disclose its plan to recover the extreme prices, would hike customers’ rates by $12.23 per month.
“While the recovery of natural gas costs typically occurs over 12 months, Black Hills has instead proposed a recovery of these natural gas costs over the next five years to reduce the impact to customer bills,” Watkins said.
Linda Berry, a spokeswoman for the agency, said it was “too early to say” whether there would be a public hearing on the larger rate hike brought on by the winter storm because the case is still in the discovery phase.
Residents who wish to participate in next month’s hearing can register online. The KCC will accept comments through the end of business on Oct. 21. Those can be submitted online; by mail to the KCC Office of Public Affairs and Consumer Protection, 1500 SW Arrowhead, Topeka, KS 66604; or by phone at 800-662-0027.
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