Requiring economic development electric rate discounts offered by public utilities to cover the incremental and variable costs to serve customers that receive such a discount.

SB 289 modifies Kansas utility law to require that electric rate discounts for qualifying industrial or commercial facilities (e.g., new factories or expansions) cover the actual incremental costs of serving those customers, rather than subsidizing the utility. It sets specific eligibility criteria, including minimum energy demand levels (200 kW to 25 MW), job creation, or capital investment thresholds, and caps annual discount rates (up to 40% for larger facilities). Starting July 2025, new discounted rates must fully cover the utility’s added costs, with utilities required to report annually on the number of discounted accounts, load changes, and economic impacts to the legislature. This directly affects utilities implementing these discounts and the businesses receiving them, ensuring discounts align with actual service costs.