Two state energy regulators on Thursday refused a consumer advocate agency’s request that they disqualify themselves from a pending case over how Westar Energy should be paid for developing large-scale wind power.
A once-confidential memo indicates that Gov. Kathleen Sebelius, who appointed the regulators, promised utilities that they would be “fully compensated” for the added costs of wind energy.
In statements filed shortly before the close of business Thursday, Kansas Corporation Commission Chairman Thomas Wright and Commissioner Michael Moffet said they are aware of Sebelius’ enthusiasm for wind energy, but have had no direct contact on the case with Sebelius, her lieutenant governor or their staffs.
“The governor sets the goals, but we set the rates,” Wright wrote. “I have no doubt that I am able to preside in this docket with an open mind.”
Wright and Moffet were responding to a recusal request filed last week by the Citizens’ Utility Ratepayer Board, the state agency that advocates for residential and small-business utility customers.
CURB’s chief consumer counsel, David Springe, said he is satisfied with the commissioners’ responses and his agency plans no further action.
“This is the affirmation that we were looking for,” Springe said. “Both (commissioners) said on the record that they have not made any promises.”
CURB challenged the commissioners’ objectivity after obtaining a confidential e-mail memo written by former Westar chief executive James Haines.
Westar is seeking compensation for wind-energy costs, plus an increased profit margin, in connection with a plan to add 300 megawatts of wind power to its system.
A decision is expected by the end of the year.
Haines indicated Sebelius and Lt. Gov. Mark Parkinson influenced Westar and several other utilities to embrace wind power, which Westar had previously rejected as being too expensive.
Haines wrote that Sebelius understood that wind power would probably cost more than other sources, at least in the short run, but that he and the other utility executives agreed to her plan after Sebelius promised they would be fully compensated for extra costs.
That raised concern at CURB that Sebelius may have made a promise she could not keep without seeking to influence the KCC, whose three members act as judges in utility rate cases.
The recusal request was directed only to Wright and Moffet because the third commissioner, Joseph Harkins, had already removed himself from the case. Harkins served as energy adviser to Sebelius before she appointed him to the commission earlier this year.
Both Wright and Moffet wrote that they knew from media accounts that Sebelius had met with utilities about wind power, but they did not know of the e-mail CURB obtained until it surfaced in the Westar case.
“The e-mail does not indicate that the governor, lieutenant governor or their representatives had discussions with me about particular actions regarding this docket or Westar,” Moffet wrote. “In fact I have had no such conversations.”
Wright made a similar statement.
“I have never discussed the setting of electric utility rates with the governor or lieutenant governor,” he wrote.
Wright said, however, that the KCC “has clearly indicated its intent to further alternative energy and energy efficiency.”
By Dion Lefler
30 November 2007