Evergy Pushes for Stronger T&D in New Five-Year Spending Plan

Researched by Industrial Info Resources (Sugar Land, Texas)--Warmer-than-normal weather took a toll on Evergy Incorporated's (NASDAQ:EVRG) (Topeka, Kansas) bottom line for 2023, but the investor-owned utility, which services parts of Kansas and Missouri, is preparing to beef up its transmission and distribution (T&D) capacity in the near term, as an industry-led boom in electricity demand looms on the horizon. Industrial Info is tracking about $900 million worth of active and planned projects from Evergy, about half of which is attributed to projects with a medium-to-high (70% or more) likelihood of beginning construction within the next two years.

Click on the image at right for a graph detailing Evergy's active and planned projects, by type.

"Our latest five-year investment plan [extended through 2028] totals approximately $12.5 billion, which represents a nearly $900 million increase relative to our prior five-year forecast through 2027," said David Campbell, the chief executive officer of Evergy, in a recent quarterly earnings-related conference call. "Nearly 55% of our planned investment is targeted toward transmission and distribution projects, as we continue to modernize our grid to improve reliability and enhance resiliency."

Among Evergy's largest T&D efforts is a series of transmission line buildouts surrounding Manhattan, Kansas, in Riley, Pottawatomie and Wabaunsee counties. The multi-phase project includes a roughly nine-mile segment connecting the North Manhattan and Zion substations, both within Manhattan; a 10-mile segment connecting the Zion Substation to the Old Post Substation in Wamego, Kansas; and a 30-mile segment connecting the Old Post Substation to the South Alma Substation in Eskridge, Kansas. Evergy plans to support the project with upgrades to the four substations, each of which will receive a new, 115-kilovolt (kV) terminal and transformer.

Subscribers to Industrial Info's Global Market Intelligence (GMI) Power Project Database can read detailed project reports on the North Manhattan-Zion, Zion-Old Post and Old Post-South Alma lines, and the North Manhattan, Zion, Old Post and South Alma substation upgrades.

In the earnings call, Evergy executives noted the company normally sees 0.5% to 1% weather-normalized annual demand growth, but now expects 2% to 3% growth in its service area through 2026, partly based on expected demand from two major projects: Meta Platforms Incorporated's (NASDAQ:META) (Menlo Park, California) $800 million data center in Kansas City, Missouri, which began construction in March 2022, and Panasonic Corporation's (Kadoma, Japan) $4 billion electric vehicle (EV) battery-manufacturing plant in De Soto, Kansas, which began construction in March 2023. The projects are expected to wrap up in third-quarter 2024 and first-quarter 2025, respectively.

Data centers and EV component production facilities typically consume heavy amounts of energy. Earlier this year, the International Energy Agency (IEA) (Paris, France) released a report indicating global electric demand from data centers, particularly those used for crypto mining and artificial intelligence, have risen sharply in recent years and could double by 2026. Subscribers can read detailed reports on the Kansas City data center and De Soto EV battery plant.

Evergy is proposing upgrades to some of its infrastructure in the Kansas City and De Soto areas. South of the Kansas City area, which straddles the Missouri and Kansas border, the company is pursuing a refurbishment of Unit 2 at a coal-fired power station in La Cygne, Kansas, which generates 685 megawatts (MW). Evergy also is seeking permits for transmission and substation upgrades in De Soto, covering about 3.4 miles of line. Subscribers can read detailed reports on the La Cygne and De Soto projects.

Evergy also is proposing the Kansas Sky Energy Center in Grant Township, which would comprise a 159-MW solar-generation facility and an 80-MW battery energy-storage system (BESS) on 734 acres northeast of Lawrence, Kansas. Evergy would build, own and operate the project, pending regulatory approvals; last month, the Lawrence-Douglas County Planning Office announced it was processing a conditional-use permit (CUP) application for the project, for which Evergy is requesting a 25-year CUP term. The project ran into a hurdle in December, when a local planning commission voted 4-4 against a recommendation for CUP approval to the Board of County Commissioners, but the board nonetheless will hold a special business meeting April 13 to consider action, according to the Douglas County website. Subscribers can learn more from a detailed project report.

In addition to its work servicing the power grid, Evergy is involved in industrial-owned power-generation projects. Evergy Energy Solutions, a subsidiary, is managing the $10 million addition of a solar unit at a cement plant in Humboldt, Kansas, which is owned by Monarch Cement Company (Humboldt). Monarch, which aims to be carbon-neutral by 2050, expects construction on the 20-MW solar unit to begin early in the second quarter; its facility produces 1.3 million tons per year of Portland cement. Subscribers can learn more from a detailed project report.

Executives at Evergy cited warmer-than-expected weather conditions throughout 2023 as the major reason for a year-over-year dip in earnings. Full-year net earnings were reported to be $731.3 million, a 2.84% dip from full-year 2022.

Subscribers to Industrial Info's GMI Project and Plant databases can click here for a full list of detailed reports for projects mentioned in this article, and click here for a full list of related plant profiles.

Subscribers can click here for a full list of reports for active and planned projects from Evergy.

Industrial Info Resources (IIR) is the leading provider of industrial market intelligence. Since 1983, IIR has provided comprehensive research, news and analysis on the industrial process, manufacturing and energy related industries. IIR's Global Market Intelligence (GMI) platform helps companies identify and pursue trends across multiple markets with access to real, qualified and validated plant and project opportunities. Across the world, IIR is tracking more than 200,000 current and future projects worth $17.8 trillion (USD).