SESSION OF 2023
SUPPLEMENTAL NOTE ON SENATE BILL NO. 68
As Amended by Senate Committee on Utilities

Brief*
SB 68, as amended, would establish right of first refusal
for incumbent electric transmission owners.

Right of First Refusal
The bill would mandate that an incumbent electric
transmission owner (owner) have the first right to construct,
upgrade, own, and maintain an electric transmission line
(line) that has been approved for construction in a
transmission plan (plan) if the line interconnects to facilities
owned or proposed to be constructed by the incumbent
owner.
[Note: In the industry, this is known as “right of first
refusal” or ROFR.]
Two or More Owners
In the case of a line that has been approved for
construction, upgrade, or maintenance in a plan that
interconnects to facilities owned by two or more owners,
ROFR would be determined by mutual agreement between
the owners.


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*Supplemental notes are prepared by the Legislative Research
Department and do not express legislative intent. The supplemental
note and fiscal note for this bill may be accessed on the Internet at
http://www.kslegislature.org
Written Notice to the Regional Transmission Organization
The bill would require the owner give written notice to
the regional transmission organization (RTO) within the time
prescribed by the RTO to indicate whether the owner or any
affiliate or subsidiary intends to exercise ROFR.
[Note: The RTO for Kansas is the Southwest Power
Pool (SPP).]
Owner Requirements
Upon submission of a notice of intent to exercise ROFR,
the owner would be required to:
● Already have obtained from the Kansas
Corporation Commission (KCC) a certificate of
convenience and necessity for the construction of
the line pursuant to KSA 66-131, and amendments
thereto (certificate); or
● Within 18 months after the submission of the
notice, file an application for a certificate seeking
permission to begin construction of the line.
Other Electric Transmission Entities
The bill would provide that any other electric
transmission entity could construct, upgrade, own, and
maintain a line if:
● The incumbent owner with the right to exercise
ROFR:
○ Does not timely indicate the owner, or affiliate
or subsidiary, intends to exercise ROFR;
○ Is deemed to not be qualified for the
construction, upgrade, ownership, and
maintenance of the line by the RTO;

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 ○ Has not received or fails to timely seek a
certificate for the line; and

● The transmission entity receives all necessary
authorizations or approvals required by the RTO.
Owner’s Use and Control of Property Rights
The bill would state that nothing in Section 1 of the bill
would be construed to affect an owner’s use and control of its
existing property rights, including, but not limited to, the
owner’s ability to assign its rights to construct, upgrade, own,
and maintain a line as described in the section. The bill would
require the retention, modification, or transfer of existing
property rights described in the section to remain subject to
the relevant state law recognizing the property right.

Municipally Owned or Operated Utilities
The bill would also state that nothing in Section 1 of the
bill would be construed to affect the right of any municipally
owned or operated utility to develop, construct, upgrade, own
and maintain transmission facilities, substations, and controls
used to serve load requirements.

Sunset
The bill would sunset the ROFR on July 1, 2033.

Definitions
The bill would define the following terms:
● “Electric transmission line” would mean any line or
extension of a line in the state with a rating 100

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 kilovolts (kV) or greater or any related transmission
facilities, substations, and controls;
● “Incumbent electric transmission owner” would
mean every corporation, including municipal
corporations, company, individual, association of
persons, their trustees, lessees or receivers, that
now or hereafter owns, controls, operates, or
manages, except for private use, any equipment or
plant, or any part thereof, for the transmission,
delivery, or furnishing of electricity or electric power
in the state. If there are two or more owners of a
line, the term “incumbent electric transmission
owner” includes each such owner;
● “Regional transmission organization” would mean
the organization authorized by the Federal Energy
Regulatory Commission (FERC) to conduct
regional transmission planning and provide notice
of requirements for line construction in the region
that includes the state of Kansas; and
● “Transmission plan” would mean a transmission
plan adopted by the entity with authority for
transmission planning in a RTO recognized by
FERC.

Background
The bill was introduced by the Senate Committee on
Utilities at the request of a representative of ITC Great Plains.


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Senate Committee on Utilities
Proponent Testimony
In the Senate Committee hearing, proponent testimony
was provided by two representatives of ITC Great Plains and
representatives of Evergy, Kansas Farm Bureau, Liberty
Utilities, Midwest Energy, and Sunflower Electric Power
Corporation. The proponents stated that FERC Order 1000
was intended to increase competition in bids for transmission
projects, but instead of utilities designing cost-effective or
innovative solutions, it led to submitting low bids to win the
project that then led to cost overruns and increased utility
rates. Most of the states in the SPP have passed state ROFR
laws, which means their transmission is built by local utility
companies, while Kansas’ lack of a ROFR law allows anyone
from out-of-state to bid for a transmission project.
Written-only proponent testimony was provided by the
International Brotherhood of Electrical Workers.
Neutral Testimony
Neutral testimony was provided by representatives of
the Citizens’ Utility Ratepayer Board (CURB) and Kansas
Corporation Commission (KCC). Written-only neutral
testimony was provided by representatives of the Kansas
Municipal Energy Agency, Kansas Municipal Utilities, KCC,
KPP Energy, and League of Kansas Municipalities.
Opponent Testimony
Opponent testimony was provided by a Professor of
Law from Vanderbilt University and representatives of
Americans for Prosperity, Clean Energy Business Council
and Climate + Energy Project, Kansans for Lower Electric
Bills, Kansas Agribusiness Retailers Association and Kansas
Grain and Feed Association, Kansas Chamber, LS Power

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Development, Next Era Energy Resources, Polsinelli Energy
Practice Group, R Street Institute, Spirit Aerosystems, and
Wichita Regional Chamber of Commerce. The opponents
generally stated there are constitutional implications in ROFR
laws, as a lawsuit is pending in Texas; removing competition
for transmission projects will not decrease utility rates for
Kansans; and transmission costs are what is increasing rates
in the SPP territory, and the bill would not allow new
investment and technologies from outside the state to be
considered as part of the bidding process.
Written-only opponent testimony was provided by a
representative of the Advanced Power Alliance.
Senate Committee Amendments
The Senate Committee adopted amendments to:
● Remove language that would require approval by
the RTO in the definition of “incumbent electric
transmission owner”;
● Add language that states nothing in Section 1 of
the bill would be construed to affect the right of any
municipally owned or operated utility to develop,
construct, upgrade, own and maintain transmission
facilities, substations, and controls used to serve
load requirements;
● Add “including municipal corporations” in the
definition of “incumbent electric transmission
owner” with regard to corporations; and
● Add a sunset of July 1, 2033.


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Fiscal Information
According to the fiscal note prepared by the Division of
the Budget on the bill, as introduced, CURB and KCC
indicate that enactment of the bill would have no fiscal effect.
Electric transmission lines; transmission; regional transmission organization;
incumbent electric transmission owner; Kansas Corporation Commission; right of
first refusal


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