News Release

For more information contact: Abbie Hodgson, 785-271-3269

June 18, 2009

Settlement Reached in KCP&L Rate Case: Parties agree to $59 million rate increase

Topeka, KS-Kansas City Power & Light (KCP&L), Kansas Corporation Commission (Commission) staff, and the Citizens' Utility Ratepayer Board (CURB) have asked the Commission to approve a settlement they've reached regarding KCP&L's application for a rate increase. The Commission has the authority to approve or deny the Stipulation and Agreement in whole or in part.

KCPL had originally asked for a $71.6 million or 17.5 % increase, but the agreement lowered that by $12.6 million to an overall revenue increase of $59 million. According to KCP&L, this will result in an average monthly increase of $10.36 or 14.43 percent for residential customers. Following almost a year of audits, scrutiny and litigation over various issues, the parties reached an agreement late Wednesday afternoon and filed a Stipulation and Agreement with the Commission Thursday morning.

This is the third rate case as part of KCP&L's five-year resource plan (background attached). The primary purpose of this current rate case is the recovery of costs associated with environmental upgrades at KCP&L's Iatan 1 coal-fired power plant and common costs of the Iatan 1 upgrades and construction of Iatan 2, a new coal-fired power plant under construction.

As part of the settlement, KCP&L would be allowed to treat $18 million of the total revenue increase as a pre-tax payment by customers towards the upgrades to Iatan I and the building of Iatan II. This is intended to help KCP&L meet their cash flow needs and maintain their investment grade rating during the Iatan construction project. Maintaining the rating would benefit customers in the long-term as an investment grade rating keeps the cost of capital lower. Also, KCP&L would not be allowed to collect a return on this portion of the costs resulting in lower customer rates.

A hearing will be held Monday, June 22nd at which time the Commission will determine how it will proceed in considering the stipulation and agreement. The hearing will begin at 9:00 a.m. in the first floor hearing room. The parties have requested the Commission issue an order by July 24th; if the Stipulation and Agreement is approved by the Commission, KCP&L could implement the new rates effective August 1, 2009.