GUEST COLUMN, Vance Ginn, Kansas Policy Institute
Panasonic’s special rate deal shows how corporate favoritism quietly shifts costs onto Kansans
Kansas taxpayers have already given Panasonic nearly $829 million in incentives to build its massive electric-vehicle battery plant in De Soto — the largest economic-development deal in state history. Now, as Sunflower State Journal reports, Kansans could soon be paying again — this time through their monthly Evergy utility bills.
Evergy has asked the Kansas Corporation Commission (KCC) to approve a 10-year “special contract” that would grant Panasonic electricity rates lower than what other large industrial users pay. The company insists this will make Kansas more competitive and ultimately help other customers. But when a state-regulated monopoly–with guaranteed profits–offers discounts to one of the world’s largest corporations, someone else has to make up the difference. That “someone else” is you — the ratepayer.
Hidden subsidies disguised as competitiveness
Evergy’s filing claims the contract is “consistent” with other special deals for large manufacturers and is “in the public interest.” The company argues that Kansans benefit from the 4,000 jobs Panasonic promises to bring, and therefore, it’s reasonable that Kansans shoulder part of the cost of keeping those lights on cheaply.
But the filing conveniently omits key details — including how deep the discount is and how much revenue could be shifted onto other customers later. Evergy says it’s only asking the KCC to track those costs for now, but that tracking is the first step toward eventually recovering them in a future rate case.
This is what economists call ratepayer cross-subsidization — a polite term for hidden redistribution. When regulated monopolies discount rates for politically favored corporations, they simply spread those costs across everyone else’s bills. It’s corporate welfare by stealth, tucked into your utility statement.
The illusion of shared benefit
Panasonic’s spokesperson told the Sunflower State Journal that competitive rates were a “key factor” in the company’s site selection and that it would pay for 100% of its own dedicated infrastructure. That sounds fair — until you realize Panasonic is already benefiting from nearly a billion dollars in state subsidies through the 2022 APEX program.
If a project truly brings economic value, it shouldn’t need a double subsidy — first from taxpayers, then from ratepayers. The Citizens’ Utility Ratepayer Board (CURB) has repeatedly warned that special contracts “permit these customers to avoid paying their full cost of service.” Those lost revenues are redistributed to everyone else, undermining the very “just and reasonable rates” that utilities are supposed to provide but don’t.
The KCC’s test for approving special contracts asks whether the deal is necessary, whether it benefits the utility and its customers, and whether rates remain fair. In this case, each standard is questionable.
Necessity: Panasonic already committed to Kansas after receiving huge state subsidies; another special deal isn’t essential.
Benefit: Any short-term gain from one big customer is outweighed by higher rates for thousands of others.
Fairness: Favoring one industrial giant over small manufacturers and families violates basic fairness in a regulated market.
If Evergy and Panasonic are confident this deal benefits everyone, they should release the rate details for public scrutiny. The lack of transparency speaks volumes.
Picking winners and losers never works
When government and its regulated monopolies start deciding which companies deserve special treatment, the result isn’t prosperity — it’s distortion. The free market allocates resources best when prices reflect real costs. But special rates and political promises muddy those signals, rewarding size and influence over efficiency and innovation.
If Panasonic’s project is as transformative as advertised, it can thrive under the same pricing rules as everyone else. Let competition, not favoritism, determine success.
Kansas should reject this new form of corporate welfare and instead pursue reforms that keep energy affordable for all Kansans:
Prohibit ratepayer subsidies for individual corporations.
Ensure full transparency for all special utility contracts.
Encourage competition in energy generation and distribution where possible.
End government incentives and focus on reducing taxes and regulations for everyone.
Final thoughts
Kansas doesn’t need to choose between economic growth and fairness — it just needs to stop choosing winners and losers. Prosperity built on hidden subsidies isn’t real prosperity.
The state’s job is to create a level playing field, not tilt it toward the loudest or largest players. The more government steps back and lets markets work, the more Kansans — workers, families, and entrepreneurs alike — will truly prosper.
