US utilities holding company Great Plains Energy said its plans to acquire power utility Westar Energy in a US$12.2bn deal to expand its utility business.The acquisition will increase the holding company’s customers in Kansas and Missouri to 1,5 million who are provided electricity from various energy sources.
The decision to buy the power utility follows Great Plains Energy securing a US$8 billion loan from the Goldman Sachs Bank USA.
To date, the firm owns two utilities in Kansas, KCP&L Greater Missouri Operations Company and the Kansas City Power & Light Company
[quote] The length of transmission and distribution lines under Great Plains Energy will increase to 10,000 miles and 51,000 miles respectively.
Acquiring Westar Energy will also ensure that Great Plains Energy increases its generation portfolio using smart energy and carbon free resources.
The development will result in more than 45 per cent of the three utilities’ (KCP&L Greater Missouri Operations Company,Westar Energy and Kansas City Power & Light Company) combined retail customer demand being met with emission-free energy.
The deal is expected to be completed in the second quarter of 2017 upon conclusion of all regulatory approvals by the Kansas Corporation, the Federal Energy Regulatory, the Nuclear Regulatory and the Federal Trade Commissions as well as the U.S. Department of Justice.
In a press statement, Terry Bassham, CEO of Great Plains Energy and KCP&L commented: “The utility industry is facing rising customer expectations, increasing environmental standards and emerging cyber security threats. These factors, coupled with slower demand growth for electricity, are driving our costs and customer rates higher. Our acquisition of Westar will create operational efficiencies and future cost savings that will benefit all involved – customers, shareholders, employees and the communities we serve. These savings also will help reduce future rate increase requests.”
Westar Energy is Kansas’ largest power utility generating 7,200MW of electricity from its wind, coal, uranium, natural and landfill gas powered plants to serve a consumer base of nearly 700.000.
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