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Additional power plant at Iatan closer to reality

by Kim Fickett
Landmark reporter

KCP&L is getting one step closer to receiving all permits needed to build a second power plant at Iatan in Platte County.

On Jan. 31, Missouri Department of Natural Resources granted KCP&L an Air Pollution Permit for the Iatan II plant, which is scheduled to begin construction in late 2006. The second plant is scheduled to be built next to Iatan I, five miles north of Weston.

The latest permit allows KCP&L to construct a coal-fired boiler, a fuel oil-fired auxiliary boiler, associated storage, handling and pollution control equipment, a fuel oil storage tank and a landfill. It will also allow for the modification of the existing coal-fired generating unit to increase the heat input and upgrade the pollution control system.

Susan Brown of Concerned Citizens of Platte County, a community group opposing the plant's construction, said, “It is disappointing that KCP&L has been rewarded with a construction permit for their new plant despite evidence pointing toward wrongdoing (referring to allegations of KCP&L violating permit).”

KCP&L submitted its application for the air pollution permit in May 2005. Brown said she anticipates that the permit will be appealed and she supports that action.

According to William Riggins, vice-president of law and environmental at KCP&L, before construction can begin on the new plant, the firm must receive at least two additional permits. The Corp of Engineers still must issue a Wetlands Permit and a Findings of No Significant Impact, which encompasses several factors including wetlands, endangered species and air quality.

The Iatan II plant is estimated to cost KCP&L $700 million for their share in the new facility. Anticipated completion date of the new coal-burning facility is in 2010.

KCP&L also announced last week that it has filed a request with the Missouri Public Service Commission and the Kansas Corporation Commission to increase rates for electric service for the first time in 20 years.

Riggins said their decision was not influenced by the construction of Iatan II but instead the increase is needed because of their service territory’s continued growth over the last several years.
“Mid-America Regional Council (MARC) has estimated the population growth will be 20 percent over the next 25 years, which translates into a demand on electricity by about 2% a year,” said Riggins.

Riggins stated the anticipated growth combined with higher demand per household is cause for the needed request of a rate increase at this time.

“Put that all together and we’re anticipating a two percent annual increase in demand and that’s what is generating an increase," stated Riggins.

Over the last 20 years, KCP&L has moved in the opposite direction of other electric companies across the nation and decreased rates. Now Riggins said they have been forced to join other companies that are also requesting rate increases brought on by the economy.

“We have decreased rates several times and we haven’t seen an increase in 20 years,” said Riggins. “We have been able to offset those increasing costs by increasing efficiency. We have come to a point now where we can’t continue to offset transportation, fuel and pension costs.”

However, Brown feels if KCP&L would have taken appropriate action a rate increase would not be necessary.

“The rate increase is due to rising coal cost and transportation costs. If KCP&L would have invested heavily in energy efficiency and renewables like other energy companies have, we might not be faced with these fuel cost related increases,” said Brown.

Riggins also stated the rate increase would go to fund the implementation of certain components of KCP&L’s new strategic energy plan. A plan which includes such projects as their new wind farm that will be operational in October, environmental upgrades to existing plants, transmission/infrastructure improvements, and energy efficiency and affordability programs.

In Missouri, KCP&L is seeking a $55.8 million or 11.5% increase in electric revenues and in Kansas the company is requesting a $42.3 million or 10.5% increase. The increase would boil down to approximately $7 per month for a typical Missouri residential customer’s bill and about $8 to a typical Kansas residential customer’s monthly bill.

If their request is approved, KCP&L is anticipating the new rates to take effect Jan. 1, 2007.


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