Midwest Energy Files Electric Rate Increase Proposal

Midwest Energy, Inc. announced that it has filed a request with the Kansas Corporation Commission (KCC) to increase its electric rates. The request is for $3.3 million and will affect all Midwest Energy customers. The new rates would become effective in November, 2011.

If approved, the application would result in an average increase of 2.5% in customers’ monthly bills. An average residential customer’s bill would increase by approximately $2.29 per month. “We are continuing needed improvements to and replacement of our electric system for reliability,” said Earnie Lehman, President and General Manager of Midwest Energy.

Unlike the larger increases related to the new Goodman Energy Center peaking power plant approved in 2008 and 2009, this request is mostly driven by replacement of transmission and distribution lines and increases in operation and maintenance expenses. Lehman noted Midwest Energy’s Board of Directors has taken the unusual step of lowering the Cooperative’s target equity level for this rate application. “To help soften the impact of the increase in the recovering economy, the Board of Directors reduced our target equity level to 35 percent from the more typical 40 percent level,” Lehman said. “While that did not eliminate the need for an increase, it helps offset recent increases in wholesale power costs and the on-going construction program.”

Midwest Energy is also proposing changes in its rates to promote energy efficiency. An “inverted block” rate will reward residential and small commercial customers for using less energy in peak summer months. Irrigation customers who allow their pumps to be interrupted on peak demand days will qualify for a bill credit. The KCC has 240 days to issue a ruling on Midwest Energy’s application. Midwest Energy, headquartered in Hays, KS, is a customer-owned cooperative serving 48,600 electric customers and 41,800 natural gas customers in 41 central and western Kansas counties.