Project Development, Wind Power

Westar Recieves Decision on Wind Investment

The Kansas Corporation Commission (KCC) has issued its order on Westar Energy, Inc.’s request for the commission to determine the rate treatment for its proposed investment in wind energy. The KCC found the utility’s proposal to invest in wind energy prudent, but declined to approve Westar’s request for an incentive rate of return.

The order also indicated that in the future wind generation could be subject to undefined operating standards and potential financial penalties that have not been imposed on other forms of generation. In October Westar Energy announced it had reached tentative agreements with developers to build three wind farms totaling 295 megawatts of generation. Westar had planned to add an additional 200 MW of wind power by the end of 2010.

“We are concerned that the KCC’s decision introduces uncertainty as to how wind investments might be regulated in the future, increasing their risk and inhibiting such development. Because deadlines are so tight to secure some of the state’s most attractive wind sites for our customers, we will move forward with 295 MW despite the increased risks,” said Bill Moore, Westar Energy president and chief executive officer. “However, given the regulatory uncertainty that the commission’s order introduces and the decision by the commission not to approve the legislatively-authorized incentive for producing electricity from a renewable resource, we have suspended plans to move forward with additional wind generation.”