Kansas City Power & Light Co.‘s Request for Authority to Implement a General Rate Increase for Electric Service v. Missouri Public Service Commission

Kansas City Power & Light Company (KCPL) (plaintiff) was a public-utility company providing electricity to customers in and around Kansas City. It was regulated by the Missouri Public Service Commission (commission) (defendant). KCPL planned to install and operate over 1,000 electric-vehicle-charging stations (EV stations) throughout Kansas City. In 2016, KCPL applied to the commission for permission to increase its rates. KCPL argued that its EV stations qualified as electric plants and should therefore be included in its rate base, meaning in its physical assets on which its revenue requirements and reasonable rate of return would be based. The commission rejected that request, concluding that it could not include the EV stations in KCPL’s rate base because the EV stations were not an electric plant as defined by Missouri Revised Statutes § 386.020(14). The commission reasoned that the EV stations did not furnish electricity for light, heat, or power, but instead were specialized equipment that offered a charging service to charge the vehicle batteries that provided electricity to vehicles. The commission likened EV stations to laundromats, reasoning that the fact that a laundromat used electricity to provide clothes-drying services did not make the dryers an electric plant. The commission also provided policy arguments for its refusal to recognize EV stations as electric plants. Specifically, it claimed that including KCPL’s EV stations in its rate base would (1) result in non-electric-vehicle-owning ratepayers effectively subsidizing the vehicle usage of the few electric-vehicle owners, (2) decrease competition by giving KCPL a competitive advantage over charging stations operated by nonutilities unable to recoup capital expenditures from ratepayers, and (3) increase the risk that KCPL would wastefully construct unnecessary EV stations because it faced no monetary losses from doing so. KCPL appealed the portion of the commission’s report and order that held the EV stations were not electric plants and thus could not be included in the rate base.