Kansas officials say energy sharing could increase rates — or help with next winter storm
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The shadow of Winter Storm Uri continues to loom large in Kansas.
Over 18 months after a historic cold snap hit the region, Kansas officials are divided over whether the proper response should be to work more cooperatively with other states and regions — or if it will actually result in higher costs and lower reliability for Kansans.
Members of the Kansas Corporation Commission, the state's utility regulatory body, were at odds Tuesday over whether to tell federal officials they largely support the idea of allowing for more power transmission projects to share electricity between states.
Supporters say this is a logical response to the February 2021 winter storm, where they believe the state would have been sunk without the ability to import power from elsewhere.
But others say the new federal rules would mark a major overhaul of existing policy, with unknown impacts on Kansas. And whether the KCC should wade into the issue at all is also in dispute.
"KCC policy must be consistently constrained by and remain within the acknowledged boundaries and limits of the commission’s legislatively delegated authority," KCC Commissioner Dwight Keen said during the meeting Tuesday.
Officials consider whether winter storms should prompt policy shift
What lessons to take away from the February 2021 cold snap has long divided policymakers.
KCC staff told lawmakers earlier this year that renewable energy performed about as expected during the historic week of freezing temperatures that slammed the Great Plains and beyond, while coal and nuclear power exceeded expectations.
Shuttered wells in Texas and Louisiana, however, caused natural gas production to plummet and prices to soar.
The high costs have since been passed onto many Kansas consumers and Attorney General Derek Schmidt's office said in September they would explore using outside counsel to launch an investigation into price gouging, though Schmidt's office has not provided further updates on the work of a Florida-based firm on the matter.
But the situation, some say, could have been far worse.
A report from the Federal Energy Regulatory Commission found the Southwest Power Pool, the regional grid Kansas shares with its neighbors, imported power from areas not affected by the arctic temperatures.
Texas, meanwhile, languished with insufficient power, leaving millions in the dark and resulting in as many as 702 deaths.
This has pushed FERC and others to consider whether transmission projects allowing the flow of power from one state or region to another should be a more vital part of energy policy.
"We’re just crossing our fingers, hoping that nothing terrible happens again,” FERC Commissioner Willie Phillips said. “This all comes down to, for me, reliability, and reliability is about risk. So we all need to ask ourselves, what is our risk tolerance?”
Federal rules would mean more planning on transmission projects
The agency is moving forward with considering rules to require companies engage in much more long-term planning and consider a much wider array of potential benefits in evaluating future transmission lines. This can tip the scales in favor of more transmission projects.
While FERC granted initial approval to the idea earlier this year, a final vote isn't expected until late 2022. Instead, the body must hear comments from stakeholders, including the KCC.
Debate over transmission projects is increasing in Kansas. A proposed power line from Wolf Creek nuclear plant in Burlington to a Missouri power station is currently under review by state regulators, even as it raises concerns from local residents and some utility experts.
More: Proposed transmission line in southeast Kansas could say a lot about the Plains' energy future
The goal of that project is to move wind power generated in Kansas to main population centers and then send electricity from Wolf Creek elsewhere.
For KCC Commissioner Susan Duffy, the "dynamics changed" after the 2021 winter storms. She said the goal should be to mirror the interstate highway system, moving power across the country.
"Ultimately our responsibility is to ensure the affordability, reliability and resilience of our service in the state of Kansas," she said.
Commissioner Andrew French said he believed the comments the agency would submit pushed back on areas where Kansas and federal interests don't align and represent a "search for the real world way to help the folks across the state."
But Keen disagreed, saying he would submit his own comments to FERC.
The proposed rules, he said, are too prescriptive and could undercut the decision-making process for entities like the KCC
"These proposals extoll perceived virtues or benefits of an extensive transmission build out to enable the transition to renewables without, in my opinion, a serious commensurate concern for controlling the costs to ratepayers associated with realizing these transmission goals," Keen said.
Some have posited that Kansas could benefit from this new dynamic, allowing it to send the ample wind energy generated in the southwest region of the state to other regions in need of power.
But cost remains a concern, with some skeptical that Kansas ratepayers will realize a benefit from any cost savings generated from these projects. Others believe these savings will only occur in the long term.
Critics say rules represent federal overreach
A group of 18 attorneys general, including Schmidt, submitted comments to FERC last week asking them to delay any potential consideration of the rules.
"The States are concerned about intentional and unintentional consequences associated with this Proposed Rulemaking," the letter, led by Utah Attorney General Sean Reyes, said. "It raises complex issues including matters of federal and state jurisdiction, public policy, environmental concerns, and cost allocation."
The KCC has not considered the FERC rules publicly before, nor has the Legislature.
Sen. Mike Thompson, R-Shawnee, chair of the Senate Utilities Committee, said the commissioners wanted to steer the state into an area when they did not have the authority to do so.
"It really takes away our ability as the Legislature to make a determination about what kind of generation mix we want in the state," he said. "It's basically a regional and national view rather than a granular local view about what is necessary."
Some argue the shift is not necessarily a bad thing.
"I do believe there is a lot of room for improvement on a nationwide basis, acting with FERC, to ensure the reliability of our system," Duffy said. "Not just in our state on a day like today but in those most extreme times when it was critical that energy was moved from one place to another."
But Thompson said he believed it would ultimately lead to cost increases for Kansas ratepayers, as well as simply become unwieldy to implement in practice.
"I think this is gonna turn into a giant mess, to be honest," he said.
Andrew Bahl is a senior statehouse reporter for the Topeka Capital-Journal. He can be reached at abahl@gannett.com or by phone at 443-979-6100.
This article originally appeared on Topeka Capital-Journal: Kansas officials divided on how federal energy policy affects rates
