Washington (Platts)--25Feb2008

Westar Energy said in an energy plan released Friday that soaring
construction costs and growing opposition to coal-fired plants have led it to
focus on a mix of energy efficiency, wind farms, and natural gas-fired plants
to meet its incremental power needs for the foreseeable future.

The Kansas utility said conventional planning would suggest it build
peaking plants "until overall load grew to a point where baseload plant
economics would prevail." That approach would have led the utility to plan for
a new coal plant that would come online "the middle of the next decade."

Westar added, however, that a "confluence of events ... indicates that
such an approach brings greater risk for Westar and its customers than it did
in the past." Capital costs associated with a new coal plant have "nearly
doubled" in the past two years to "as much as $2,400-$2,900/kW," gas prices
have fallen, the climate-change issue "has moved from a polarizing debate to
mainstream belief" and "clean-coal" technologies involving carbon capture and
sequestration "have not yet proved themselves in commercial applications."

Westar noted that while its focus for the next several years will be on
energy efficiency, wind power and gas-fired combined-cycle and
combustion-turbine plants, it also will make "significant investments in
environmental upgrades at existing coal plants" and "[c]ontinue to study and
remain flexible with respect to traditional baseload coal, nuclear and
emerging baseload technologies."