Section 8 - Other Events
Item 8.01 Other Events
On July 29, 2025, Louisville Gas and Electric Company (“LG&E”) and Kentucky Utilities Company (“KU”, and collectively with LG&E, the “Companies”) announced that they filed with the Kentucky Public Service Commission (“KPSC”) a stipulation and recommendation (the “stipulation”) regarding a proposed resolution of issues with several of the intervenors in the Companies’ proceedings commenced in February 2025 before the KPSC regarding certain future generation-related construction projects and associated accounting matters.
Under the stipulation, the parties agree the KPSC should issue an order granting Certificates of Public Convenience and Necessity for: (a) an approximately 645 MW natural gas combined-cycle combustion turbine (“NGCC”) generation unit at KU’s E.W. Brown Generating Station (“Brown 12”); (b) an approximately 645 MW NGCC generation unit at LG&E’s Mill Creek Generating Station (“Mill Creek 6”); and (c) a selective catalytic reduction (“SCR”) system at KU’s Ghent Generating Station, Unit 2.
Additionally, under the stipulation, if approved, the Brown 12 and Mill Creek 6 costs incurred during construction would be eligible for AFUDC accounting treatment, the Ghent 2 SCR would be recovered under the existing Environmental Cost Recovery (“ECR”) mechanism, the relevant costs regarding Mill Creek 6 would be recovered through a new rate tracker mechanism, the retirement date for the existing Mill Creek Unit 2 would be extended from 2027 to the
in-service
date of Mill Creek 6, and the Companies’ proposal to build a four-hour 400MW (1,600 MWh total) battery electric storage system (“BESS”) at LG&E’s Cane Run Generating Station would be withdrawn without prejudice.
Finally, the stipulation also contains provisions relating to regulatory asset accounting, proposed data center tariffs, future renewable power
and other matters. LG&E and KU would retain the right to seek approval of the Cane Run BESS project or similar substitute projects in future regulatory proceedings.
The aggregate projected capital expenditures associated with the Companies’ proposals in the original application were expected to be approximately $4.1 billion, including AFUDC, over the 2025 to 2031 period, with approximately $2.3 billion in the 2025 to 2028 $20 billion capital plan of PPL Corporation (“PPL”), of which approximately $0.9 billion represented the Cane Run BESS project. As a result of the 40% tax credits assumed on the Cane Run BESS project, the amount assumed in PPL’s rate base projection was approximately $0.5 billion. PPL is not modifying its capital plan or rate base projections at this time as PPL expects additional investment needs over the current plan period, including additional transmission investment to support data centers in Pennsylvania. PPL plans to update its capital plan and rate base projections in conjunction with the
year-end
earnings call, as per normal practice.
The stipulation remains subject to approval by the KPSC. A hearing has been scheduled to begin on August 4, 2025. LG&E and KU anticipate a ruling from the KPSC during the fourth quarter of 2025. LG&E and KU cannot predict the outcome of the proceeding.