Iatan 2

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Kansas City Power & Light (KCP&L), a subsidiary of Great Plains Energy, is constructing an 850 megawatt (MW) coal-fired power plant (Iatan 2) next to the older Iatan Generating Station north of Kansas City on the Missouri-Kansas border.[1]

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History

In March 2007, KCP&L, the Sierra Club, and the Concerned Citizens of Platte County (CCPC) agreed to a legally binding contract that will run through 2015 and reduce emissions for the Kansas City-based utility, thus resolving four appeals and a six year dispute with the Sierra Club. KCP&L agreed to reduce overall carbon dioxide emissions by 20 percent by 2020 through legislative and regulatory changes that are yet to be determined, and also agreed to offset all greenhouse gas emissions at its Iatan 2 unit. This will be accomplished by adding 400 MW of wind power, and programs that will save 300 MW of energy demand. The measures will be initiated by 2010 and fully implemented by 2012.[2]

In May 2008, KCP&L released new cost estimates for plant, raising the cost 15 percent to almost $2 billion, and indicated it may increase the estimate again after the engineering analysis is complete. KCP&L expects to raise customers' electric rates by over 25 percent to cover costs of the new plant.[1]

The Kansas Electric Power Cooperative (KEPC), which wants to invest $55 million in the plant for a 3.5 percent share, was turned away by the Rural Utilities Service when the agency issued a moratorium on loans for new coal plants in early 2008. However, KEPC received alternate financing from the National Rural Utilities Cooperative Finance Corporation (CFC) at 2 percentage points higher than the original RUS loan.[3]

On January 13, 2010, KCP&L announced that construction of the new plant had fallen behind schedule. The company estimated that the plant could be in service two months later than expected. The delay could also push back a rate increase request filed in Kansas and slated for October 2010, and another to be filed in Missouri and slated for the first quarter of 2011.[4] On December 7, 2010, Governor Jay Nixon dedicated the Iatan 2 plant.[5]

Rate Increase

According to an August 2008 update by the Sierra Club, Platte County School district is concerned that KCP & Light is not paying enough taxes on its Iatan 2 unit. Given the rising costs of the plant construction, the school feels the amount that they are receiving will not be enough to offset the financial difficulties they will face once the new projects are completed.[6]

In April 2011, the Missouri Public Service Commission voted 5-0 to approve Kansas City Power & Light’s (KCP&L) request for a $34.8 million rate increase. KCP&L initially sought an increase of $92.1 million, stating higher than expected running costs of the new Iatan 2 plant as the primary reason for the increase request. Under the new agreement, which will go into effect May 4, 2011, roughly 350,000 customers in Kansas City will see an estimated increase in their monthly bill of $4.85 (5.23%). Starting in June 2011, customers once served by Aquila Inc.’s Missouri Public Service and St. Joseph Light and Power will also pay higher annual rates. This is the fourth rate increase KCP&L has been granted since 2005.[7]

Project Details

Sponsor: Kansas City Power & Light
Location: Weston, Platte County, MO
Capacity: 850 MW
Type: Supercritical
Projected in service: 2010
Status: Operating

Financing

Citizen Groups

Resources

References

  1. 1.0 1.1 "Stopping the Coal Rush", Sierra Club, accessed January 2008. (This is a Sierra Club list of new coal plant proposals.)
  2. "Environmental, Community Groups Announce Important Energy Agreement with Major Utility", Sierra Club press release, March 20, 2007.
  3. "Loss of federal loan fails to derail four other coal-fired power plants," Great Falls Tribune, October 19, 2008.
  4. Steve Everly, "Kansas City Power & Light's new coal plant is behind schedule," Kansas City Star, January 13, 2010.
  5. "Missouri Governor Dedicates KCP&L's Iatan 2 Power Plant," KCP&L press release, December 7, 2010
  6. "Stopping the Coal Rush", Sierra Club, accessed November 2008. (This is a Sierra Club list of new coal plant proposals.)
  7. "Stopping the Coal Rush" Sierra Club, accessed November 2011.

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