PSC Approves Evergy For Securitization For Extraordinary Costs From 2021 Winter Storm Uri

The Missouri Public Service Commission has authorized a financing order which allows Evergy Missouri West to issue securitized utility tariff bonds for qualified extraordinary costs that resulted from the February 2021 winter weather event known as “Winter Storm Uri”.

Winter Storm Uri drew unseasonably cold temperatures to Missouri, and much of the Midwest, which resulted in rolling electrical blackouts and extreme natural gas price spikes. The temperatures between February 6th and February 19th averaged more than 20 degrees below normal and brought in the coldest two-week period experienced in Missouri in over 30 years.

During that time, Evergy West reported they incurred $11.8 million in fuel costs. Its average February fuel cost is $8.3 million. It also claimed a cost of $314.6 million in purchased power. That is an increase of nearly $300 million more than the average February purchased power costs.

With the authorization of securitization, Evergy will be allowed to take existing debt and turn it into customer-backed bonds which are sold in the financial markets. The authorization to recover the securitized utility tariff charges will be for 15 years. Securitized utility tariff charges will be identified on each customer’s bill as a separate line item and include both the rate and the amount of the charge on each bill.

The Public Service Commission rules that the securitization process was in the public interest when the process was compared to other methods to recover the costs when included a Fuel Adjustment Charge or general rate case filings.