KCC rules on motions in natural gas rate cases

Chad Frey
The Kansan

TOPEKA – Investigations and litigation of price spikes of natural gas during winter storm Uri in February continue, with the the Kansas Corporation Commission denying two motions filed by the Natural Gas Transportation Customer Coalition this week. 

Winter storm Uri caused massive price increases to natural gas, an event still under investigation and litigation.

The Natural Gas Transportation Customer Coalition said in an amended KCC filing in August that the total cost to Kansas ratepayers across all utilities would be upwards of $1 billion.

Natural gas prices spiked from $3 a unit to more than $620 a unit locally. Area municipalities including Walton, Hesston and Halstead took out low interest loans from the state to pay the price of gas, and will pass those costs on to customers over the course of several years. 

According to filings in August. customers with Kanas Gas Service, the state's largest natural gas utility, could see their bills increase by between $5 and $17 monthly, depending on how the company elects to pay off cost increases from February winter storms —  part of the company's effort to securitize bonds in a bid to repay upwards of $450 million in additional costs from the storm. 

Newton USD 373's bill was more than $187,000 — about six times the normal bill for the time period. The district, along with the Newton Recreation Commission and about than 137 school districts formed a litigation pool to try and lower the bill. 

This week the first motion asked the Commission to subpoena documents from S&P Global Platts Gas Daily relating to its daily price index. While acknowledging the concerns, the Commission order states that jurisdiction to investigate wholesale market manipulation lies with the Federal Energy Regulatory Commission (FERC), which has already opened an investigation.

“While NGTCC may raise legitimate concerns, this Commission is simply not the forum for such an investigation," the KCC wrote in its finding. "This Commission is focused on the behavior of its jurisdictional utilities and whether they acted reasonably and prudently, under the circumstances. However, if suppliers, traders, or other entities engaged in market manipulation or price gouging within the wholesale market, as NGTCC posits, FERC's investigation is intended to uncover such actions.”

The second request was that invoices from Kansas Gas Service’s suppliers be made public. In denying that motion, the Commission determined that supplier invoices satisfy the definition of “trade secret” as defined by K.S.A. 60-3320 and are protected as propriety information as set forth by the U.S. Supreme Court and the Kansas Supreme Court. The order notes that giving the public access to the invoices would not aid the Commission in its investigation because the KCC’s Staff, NGTCC, and all other parties to the docket, including the Kansas Attorney General’s Office and the Commission itself, already have full access to the documents. The Attorney General’s office is investigating February’s wholesale gas prices as part of its consumer protection probe.

All regulated Kanas utilities are required to work with the KCC to determine how the February gas prices will be passed on to ratepayers. While Federal and State investigations into the matter continue, the Commissioners emphasized their expectation that Kansas natural gas consumers will be compensated in the future if price gouging or market manipulation is uncovered.