1 Westar Energy’s 2013 Annual Transmission Revenue Requirement Meeting October 30, 2012

2 Today Status Report: Transmission Projects Quick Review of the Past The Results: 2013 ATRR What Do These Results Mean to Our Customers? Protocol Review Meter Cost Recovery Policy

4 Transmission Investment Projected Millions $ Projected

5 Future Projects in the Southwest Power Pool

6 Quick Review: The Formula Gross Revenue Requirement (GRR) includes: Projected Transmission Plant In-Service Projected Transmission O&M Projected Transmission Depreciation Expense Taxes Return Net Revenue Requirement adjusts the GRR for: Revenue Credits received for Point-to-Point Transmission Service “Rent” received (i.e. pole attachments) True-Up for prior year’s difference between actual and projected, including interest

7 Quick Review: The Past 2009 was the first ATRR that included the forward- looking, revised formula History of true-up adjustments: -$17.8 M was applied in the 2011 ATRR, for 2009 business $4.5 M was applied in the 2012 ATRR, for 2010 business -$9.8 M will be applied in the 2013 ATRR, for 2011 business Key aspect of true-up amounts: O&M The TFR calculates a projected O&M based on the percentage increase in Transmission Plant times the actual O&M from the previous actual year This function of projecting O&M is part of the FERC- approved TFR

8 The Results: ATRR for 2013 Westar’s Gross Rev. Requirement $230,234,224 Revenue Credits($ 22,198,015) True-Up from 2011($ 9,786,991) Westar’s Net Rev. Requirement $198,249,218 SPP’s BPF Rev. Requirement*($ 64,795,034) SPP Zonal Rev. Requirement** $133,454,184 * Funds collected under Schedule 11 ** Resulting rates go into effect with January 1, 2013, business

9 The Results: What Does this Mean to You? Example of a Customer’s Estimated Transmission Costs, 2012 vs Customer’s 2011 Load Ratio Share Westar Zonal Rev. Req., plus SPP Schedule 11*$182,198,978 Customer’s Annual Transmission Service Charge (before Ancillary Services and Fees) $ 865,445 Customer’s 2012 Load Ratio Share Westar Zonal Rev. Req., plus SPP Schedule 11*$183,038,901 Customer’s Estimated Annual Transmission Charge (before Ancillary Services and Fees) $ 869,434 Estimated Difference+.46% * Includes Westar’s respective Zonal ATRR plus the most recent information posted in Attachment H of SPP’s OATT; amounts in Attachment H vary throughout the year, depending on activities of other TOs in SPP

10 Formula Protocols: Annual Update Today: October 30, 2012 Comments and questions are preferred by November 20, 2012, so we can review and revise the ATRR if necessary If necessary, revised ATRR will be posted by November 30, 2012 Send comments or questions via to: –Sheila Gropp at –Please cc: and SAVE THE DATE FOR THE 2012 TRUE-UP MEETING: June 25, 2013

11 Meter Cost Recovery Policy Purpose: To assure fair, consistent treatment of all Transmission Customers for meter-related costs Key Aspects: –Outlines recoverable capital expenses: New meter points Failed equipment Upgrades (requested by TC) Back-up meter points –Outlines recoverable O&M expenses Meter service fee TBD and filed with FERC before charged Effective Date: September 1, 2012

12 Questions?