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Minutes for SB68 - Committee on Utilities
Short Title
Providing incumbent electric transmission owners a right of first refusal for the construction of certain electric transmission lines.
Minutes Content for Mon, Feb 6, 2023
The Chairman opened the hearing and called upon committee staff for overviews on the bill
Nick Myer for a revisor overview on the bill.
The Chairman called for proponent testimony on the bill.
Tony Clark asserted that the bill is intended to determine whether transmission decisions should be regulated in the traditional way or whether Kansas should subject itself to a "newer" "unwieldly" method that has favored less experienced players and the meg-utilities at the expense of local consumer best interests. Mr. Clark opined that the FERC's Order 1000 intended to infuse competitive forces into the environment of transmission monopoly has actually failed to provide favorable consumer outcomes. He pointed out that the order "encourages unrealistic low bids", but allows recovery by the claims of cost overruns. He referenced the New York/New Jersey "Artificial Island" project as a case in point where the bureaucratic, litigation rich and time-consuming process justifies the serious consideration of a state ROFR statute.
Brett Leopold pointed out that the bill is limited in scope and only applies to the right to build a specific category of high-voltage regional SPP transmission projects of a substantial size. Mr. Leopold warned that open competition is not going to solve ratepayer issues, but explained that the first FERC 1000 project in Kansas expended a great deal of time and resources without any positive result. He explained that the costs of a major SPP project will cost Kansans only 16.5% of the total cost of the project. He warned of potential long delays and loss of access to cheaper abundant energy can be a major cost to out right competitive bid projects. He also cautioned the committee that competition can lead to lower cost and standards up front, but that it is the maintenance of 40 to 80 years should be the key focus of the project. Mr Leopold pointed out that the trouble Texas has experienced with litigation should not be a worry to Kansas because of the approaches taken by the state.
Committee questions and comments ensued.
The Chairman suspended the hearing to be continued during the next meeting.
