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City administrator outlines utility-market exposure after February energy event
Summary
City Administrator Audree Aguilera told council the city’s utility group (KMGA/KMEA) saw daily-market exposure climb from about 30% to nearly 60% during the February event, and staff are considering shifting to roughly 80% fixed winter pricing; FERC and the Kansas Attorney General investigations may take months to years.
City Administrator Audree Aguilera gave a detailed update on the regional energy crisis and the city's exposure during the February weather event, saying FERC "has indicated it could be up to two years" for investigations and that the Kansas Attorney General "indicated that around the end of the year they will end the investigation in a law-suit against someone or close the case." Aguilera summarized KMGA/KMEA purchasing strategy: the city's daily market exposure rose to nearly 60% during the event from a typical exposure near 30%, and staff are evaluating a move to about 80% fixed pricing in winter months to reduce spot-market risk.
Aguilera explained why the city could not draw down more stored gas during the emergency: an operational flow order (OFO) limited gas withdrawals to contracted amounts and penalized overages at 2.5 times the daily price. She said KMGA began buying extra gas on the daily market in early February as the event was forecast but noted that monthly supply was already locked in. The council received the report but did not take a formal vote on changing purchasing policy during the meeting; staff recommended further review and potential policy adjustments.
