Consumer Update: Southern Pioneer Electric Company Rate Filing Will Affect Electric Bills

OVERVIEW OF FILING

As permitted by the Kansas Corporation Commission (“Commission” or “KCC”) and in accordance with Docket Nos. 13-MKEE-452-MIS (“13-452 Docket”) and 16-MKEE-023-TAR (“16-023 Docket”), on April 26, 2017, Southern Pioneer Electric Company (“Southern Pioneer”) filed under one docket, but following the protocols adopted in each docket, its fourth Debt Service Coverage (“DSC”) Formula Based Rate (“FBR”) Program Annual Filing and its second 34.5 kV FBR Plan Annual Filing (together the “Annual Filings”) to make application with the KCC, requesting a retail rate adjustment.  Since you are a retail customer that receives electric service through Southern Pioneer and will be impacted by these Annual Filings, Southern Pioneer would like to give you information regarding the Annual Filings.

HISTORY OF SOUTHERN PIONEER ELECTRIC COMPANY

Southern Pioneer, with its corporate office in Ulysses, Kansas and Customer Service-Distribution Offices in Liberal and Medicine Lodge, Kansas, is a not-for-profit corporation and is a wholly owned subsidiary of Pioneer Electric Cooperative, Inc. Southern Pioneer is governed by a nine-member Board of Directors, comprised of cooperative consumers, and regularly receives input on matters affecting consumers from a nine-member Consumer Advisory Council, consisting of Southern Pioneer ratepayers.  Southern Pioneer provides distribution service to approximately 17,200 plus retail consumers in 10 southwest and south central Kansas counties.  Southern also provides local access delivery service to both full and partial requirement wholesale users of its 34.5 kV sub-transmission system.

IMPACTS TO RETAIL ELECTRIC DISTRIBUTION

As part of the 13-452 Docket and 16-023 Docket, both approved by the Commission, Southern Pioneer sought and received Commission permission to create a DSC FBR Pilot Program (the “DSC Plan”) and a 34.5 kV FBR Program (the “34.5 kV Plan”) for the territory served by Southern Pioneer. The DSC and 34.5 kV Plans allows for retail and local delivery service access (“LADS”) rates to be adjusted on an annual basis, using a formula and DSC/Revenue Requirement targets, subject to an annual review and approval process by the Commission.

In order to achieve the agreed to financial/revenue requirement targets of 1.75 DSC of Southern Pioneer’s utility system using the processes and protocols approved in the 13-452 Docket and 16-023 Docket Settlements, an overall “net” retail rate decrease of $355,136 or -0.52% is required by Southern Pioneer.  The proposed revenue decrease in this Filing is necessary to assure compliance with the Commission-approved DSC and 34.5 kV FBR Plans.

Because each rate class is affected differently, as reflected in the attached schedules and based on the test year revenues and expenses, Southern Pioneer has estimated these Filings, if approved, will result in an approximate -0.84% decrease, or about a $0.92 net decrease per month, for the average residential customer. Proposed rates for other customer classes are reflected in the tables below. 

 

REGULATORY RESPONSIBILITY

The Commission regulates public utilities, who are not locally-regulated pursuant to K.S.A. 66-104d. The Commission’s oversight primarily pertains to rates and terms of service.  In order to ensure that customers of regulated utilities are provided sufficient and efficient service at just and reasonable rates, regulated utilities may not change their rates without Commission approval.

ADDITIONAL INFORMATION

A complete copy of Southern Pioneer’s Filing (the application, supporting testimony and proposed rates) is available on the Commission’s website at: http://www.kcc.ks.gov, by searching Docket Filings for Docket No. 17-SPEE-476-TAR. You may contact Randall D. Magnison, Executive Vice President-Assistant CEO at 620-424-5211 or Southern Pioneer’s Customer Service Offices at 1-800-670-4381 with questions or visit Southern Pioneer’s website at www.southernpioneer.net.

If you have questions or complaints regarding this Filing, you may also contact the Commission’s Office of Public Affairs and Consumer Protection at 1-800-662-0027 or at public.affairs@kcc.ks.gov. Questions or complaints should reference Docket No. 17-SPEE- 476-TAR.