In the coming months, Westar Energy customers will get accustomed to a new company name.
Evergy is the name chosen after Westar’s proposed merger with Great Plains Energy was approved by regulators in Kansas and Missouri on Thursday. Under the agreement, the two companies will become wholly owned subsidiaries of a new parent company and serve more than 1.5 million customers in Kansas and Missouri.
There have been a lot of concerns about a potential dip in rates this year followed by a larger increase for next year. Westar spokesperson Gina Penzig says the original plan was to decrease rates in September and then increase rates early next year to account for federal tax savings, increased financing and labor “efficiencies,” depreciation, expiring wind farm tax credits and other factors. The end result would have been a roughly $52 million increase. There’s still a rate hike with the new agreement, although it’s a lower amount.
In addition, the utilities have guaranteed millions of dollars worth of customer bill credits for Kansas residents. Those will be returned to customers in the coming months, and Penzig says there is another benefit for customers as part of the merger agreement.
Westar and Great Plains originally submitted a merger proposal last year, but the KCC mentioned possible job cuts, higher costs and financial instability as reasons for denying the deal. Penzig says the revamped deal makes for a stronger situation
Any job cuts, Penzig says, would be through attrition or retirements as opposed to formal downsizing.
With the new company name Evergy being fully adopted sometime next year, Penzig says Westar customers will take care of their daily business as they have for years — including paying bills, reporting outages and the like — until the formal name change.
This agreement creates a holding company worth roughly $15 billion in equity value. The deal could close early next month.
