SOURCE: Westar Energy, Inc.

Westar Energy, Inc.

March 08, 2010 17:00 ET

Westar Energy Issues Updated 2010 Comprehensive Energy Plan

New Long-Term Strategy Addresses Managing a Difficult Economy, Cost of Regulatory Requirements

TOPEKA, KS--(Marketwire - March 8, 2010) -  Westar Energy, Inc. (NYSE: WR) today announced it has issued an updated comprehensive energy plan that addresses changing customer needs and rising energy costs in light of evolving economic, environmental and political climates.

First published in 2008, the plan entitled "Meeting Our Customers' Energy Needs: A Strategic Plan for Uncertain Times" looked at ways to encourage greater energy efficiency and develop renewable energy sources to defer constructing a new conventional coal plant. However, it did not anticipate the near collapse of financial markets or the volatility in the prices of products we use, such as natural gas and metals used in construction, in the two years following.

"2010 Update: Standing the Test of Time" outlines strategies for overcoming these economic obstacles, as well as meeting state and federal policies regarding renewable energy and environmental regulations and the increasing costs associated with embracing these policies. The updated plan projects investments of nearly $2.4 billion over the next three years, with environmental and transmission projects making up nearly $1.5 billion of that amount. 

"We've significantly modified our plans since 2008 because of the economy, but moved ahead with many investments needed to meet changing state and federal policies," said Bill Moore, Westar Energy president and chief executive officer. "We will continue to cautiously plan investments in projects that will meet those policies as well as customer needs."

One example is SmartStar Lawrence, a pilot program to deploy 48,000 "smart" meters in Lawrence and build the technology infrastructure necessary to eventually support smart meters throughout the service territory. SmartStar Lawrence will cost about $40 million, with $19 million for the project coming from the U.S. Department of Energy for smart grid development. 

While Westar remains committed to closely watching costs during the development of new energy sources, maintaining existing plants and improving their environmental performance, recent investments in these areas have impacted customer bills. For example:

  • The 2008 rate case and abbreviated rate case in 2009 allowed Westar to recover the $305 million cost associated with building the 665 megawatt (MW) natural gas-fired Emporia Energy Center;
  • The investment in Westar's 295 MW of wind generation is approximately $500 million;
  • Over the last four years, Westar has spent about $600 million for environmental upgrades to its power plants to reduce sulfur dioxide and nitrous oxide emissions;
  • The company has made significant upgrades to its transmission system, spending about $400 million, necessary to accommodate future renewable energy sources.

The updated plan also shows how the principles first guiding us in 2008 -- be flexible, preserve options, maintain diversity and avoid over-commitment to one course -- have served us well and will continue to help us address changes as they unfold.

"We intend to continue to be open with our customers about investments that will affect their bills, and we think updating our comprehensive energy plan will help them understand the reasons behind the investments," said Jim Ludwig, executive vice president, public affairs and consumer services. "We also think it will prove useful in discussions with policy makers."

Westar Energy's updated comprehensive energy plan is available on the company's Web site www.WestarEnergy.com.

Westar Energy, Inc. (NYSE: WR) is the largest electric utility in Kansas, providing electric service to about 684,000 customers in the state. Westar Energy has about 7,100 megawatts of electric generation capacity and operates and coordinates approximately 35,000 miles of electric distribution and transmission lines.

For more information about Westar Energy, visit us on the Internet at http://www.WestarEnergy.com.

Forward-looking statements: Certain matters discussed in this news release are "forward-looking statements." The Private Securities Litigation Reform Act of 1995 has established that these statements qualify for safe harbors from liability. Forward-looking statements may include words like "believe," "anticipate," "target," "expect," "pro forma," "estimate," "intend," "guidance" or words of similar meaning. Forward-looking statements describe future plans, objectives, expectations or goals. Although Westar Energy believes that its expectations are based on reasonable assumptions, all forward-looking statements involve risk and uncertainty. Therefore, actual results could vary materially from what we expect. Please review our Form 10-K for the period ended Dec. 31, 2008 and our Form 10-Q for the period ended June 30, 2009 for important risk factors that could cause results to differ materially from those in any such forward-looking statements. Any forward-looking statement speaks only as of the date such statement was made, and the company does not undertake any obligation to update any forward-looking statement to reflect events or circumstances after the date on which such statement was made except as required by applicable laws or regulations. 

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