Common Questions Regarding Winter Storm Uri and Upcoming Bills
On March 17, 2022, Southern Pioneer Electric received the formal order from the Kansas Corporation Commission (KCC) allowing it to implement the proposed billing adjustment plan for 2021 Winter Storm Uri. Southern Pioneer will issue its storm recovery charge on bills starting in May 2022.
As a not-for-profit utility, Southern Pioneer Electric implemented a plan to recover extraordinary costs incurred during the event in an attempt to mitigate the financial impact on consumers. The charge will be amortized (spread out) in equal installments over 36 months. Consumers will have the option to pay their recovery charge (in full) at any point in time during the 36-month period. Talk with a member of our customer service team for more information!
The 2021 Storm Recover Charge Overview:
The 2021 Storm Uri Recovery Charge will be composed of:
- Principal Charge: The total extraordinary expense for the Feb. 2021 winter event is determined by the consumer’s total energy usage for February 2021 billed at $0.284/kWh and divided over 36 months.
Example (charges will vary depending on a consumer’s kWh usage for Feb. 2021): A service that utilized about 1,000 kWh in Feb. 2021 would have a total principal charge of $284. This would be divided up and implemented over 36 months, adding a $7.89 charge on their bill.
- Interest: Interest at a rate of 2.14% on the outstanding principal balance charged over 36 months
- Carrying Costs: The interest accumulated on the Southern Pioneer Electric loan between February 2021 and April 2022 while the KCC reviewed Southern Pioneer’s proposed billing adjustment plan. As with the Principal Charge, this will be amortized over 36 months. There will be no additional interest charged on the Carrying Costs.
Regarding Final Bills: If the impacted service final bills (or is closed), the remaining allocated charge will be applied to the consumers’ final billing statement.
Common Questions Regarding Winter Storm Uri
Our customer service team is available during standard office hours to assist our consumers with questions or concerns regarding the charge. Contact our offices by calling 620.886.5100 or 800.670.4381.
Storm Uri Overview
During the week of Feb 14-19, 2021, Southern Pioneer Electric’s service territory experienced a polar vortex leading to record low temperatures. The cold weather increased demand for electricity across the Midwest United States. This caused the price of electricity to skyrocket to well above normal prices.
To meet the energy needs of consumers, Southern Pioneer Electric was exposed to high market prices for electricity and incurred approximately $17 million in extraordinary wholesale power costs to supply electricity to consumers during the polar vortex event.
Will new consumers receive a February 2021 Storm Uri Charge?
The charge is solely based upon a consumer’s usage during February 2021 and will not impact services initiated after that time. Service transfers of existing services may be subject to paying the remainder of any allocated Storm Uri charge at the final billing of their current service.
Can I opt to pay the February 2021 Storm Uri Charge in one payment?
After the first billing in May, you will have the option to pay your total recovery charge in one payment at any point in time over the 36-month billing period. Consumers will need to contact Southern Pioneer Electric to get the sum of their total recovery charge and instructions on how to pay. Once paid, the charge may show as a credit on the consumer’s next billing statement.
Will the total charge be taken out of my ACH in one payment?
Consumers that currently use auto-pay (ACH) payment will not see the total accumulated cost for Winter Storm Uri withdrawn from one billing payment unless:
A Consumer final bills on a service currently enrolled in ACH and does not contact our office to unenroll from the program before their final bill is drawn.
Why do I need to pay carrying costs and interest in addition to the recovery charge?
To avoid direct rate impacts for current and future consumers, Southern Pioneer’s recovery plan requires recovering all incurred expenses from the winter storm from those with usage during February 2021. Southern Pioneer Electric is a not-for-profit utility and budgets each year the approximate cost for securing power for our consumers. The extreme weather event forced Southern Pioneer electric to take out a loan to cover the extraordinary power costs incurred during the event. This decision ensures consumers only pay for the costs associated for their service and will not cover the costs of other consumers.
Why is the charge being implemented now and not in 2021?
Southern Pioneer is a regulated utility and must receive approval from the Kansas Corporation Commission before implementing billing adjustments. Southern Pioneer submitted its recovery plan in 2021, and the KCC approved it during their March 17, 2022, meeting.
Is there financial assistance available?
Currently, the State of Kansas offers two utility assistance programs to its residents. The Low Income Energy Assistance Program (LIEAP) and Kansas Emergency Rental Assistance program both offer assistance with utility bills.