v3.26.1
DERIVATIVE INSTRUMENTS
 6 Months Ended
Jun. 30, 2026
Derivative Instruments and Hedging Activities Disclosure [Abstract]  
DERIVATIVE INSTRUMENTS DERIVATIVE INSTRUMENTS
Commodity Price Risk
The Evergy Companies engage in the wholesale and retail sale of electricity as part of their regulated electric operations. These activities expose the Evergy Companies to market risks associated with the price of electricity, natural gas and other energy-related products. Management has established risk management policies and strategies to reduce the potentially adverse effects that the volatility of the markets may have on the Evergy Companies' operating results. The Evergy Companies' commodity risk management activities, which are subject to the management, direction and control of an internal risk management committee, utilize derivative instruments to reduce the effects of fluctuations in wholesale sales and fuel and purchased power expense caused by commodity price volatility.
Interest Rate Risk
The Evergy Companies are also exposed to market risks arising from changes in interest rates and may use derivative instruments to manage these risks. The Evergy Companies' interest rate risk management activities have included using derivative instruments to hedge against future interest rate fluctuations on anticipated debt issuances. From time to time, this may include entering into interest rate swap agreements to mitigate exposure to interest rate fluctuations associated with forecasted debt transactions.
Trading
The Evergy Companies also engage in non-regulated energy marketing activity for trading purposes, primarily at Evergy Kansas Central, which focuses on seizing market opportunities to create value driven by expected changes in the market prices of commodities, primarily electricity and natural gas.
Accounting for Derivative Instruments
The Evergy Companies consider various qualitative factors, such as contract and marketplace attributes, in designating derivative instruments at inception. The Evergy Companies may elect the normal purchases and normal sales (NPNS) exception, which requires the effects of the derivative to be recorded when the underlying contract settles under accrual accounting. The Evergy Companies account for derivative instruments that are not designated as NPNS as (i) economic hedges or trading contracts (non-hedging derivatives) or (ii) cash flow hedges, which are recorded as assets or liabilities on the consolidated balance sheets at fair value. See Note 10 for additional information on the Evergy Companies' methods for assessing the fair value of derivative instruments.
Changes in the fair value of derivative instruments designated as economic hedges (non-hedging derivatives) that are related to the Evergy Companies' regulated operations are deferred to a regulatory asset or regulatory liability when determined to be probable of future recovery or refund from/to customers. Recovery of the actual costs incurred by regulated activities will not impact earnings but will impact cash flows due to the timing of the recovery mechanism.
Changes in the fair value of derivative instruments designated as trading contracts (non-hedging derivatives) are recorded in operating revenues on the Evergy Companies' statements of income and comprehensive income.
Changes in the fair value of interest rate swaps designated as cash flow hedges are initially recorded in other comprehensive income (OCI). These amounts are subsequently reclassified into earnings as an adjustment to interest expense over the same period that the hedged interest payments affect earnings. The Evergy Companies classify cash flows from derivative instruments accounted for as a cash flow hedge in the same category as the cash flows from the items being hedged.
The Evergy Companies offset fair value amounts recognized for derivative instruments under master netting arrangements, which include rights to reclaim cash collateral (a receivable), or the obligation to return cash collateral (a payable).
The gross notional contract amount by commodity type for non-hedging derivative instruments is summarized in the following table.
June 30December 31
Non-hedging derivativesNotional volume unit of measure20262025
Evergy(millions)
Commodity contracts
PowerMWhs133.8 63.0 
Natural gasMMBtu101.6 54.6 
Evergy Kansas Central
Commodity contracts
PowerMWhs79.3 41.0 
Natural gasMMBtu101.6 54.6 
Evergy Metro
Commodity contracts
PowerMWhs40.6 16.5 
The fair values of Evergy's open non-hedging derivative positions and balance sheet classifications are summarized in the following tables. The fair values below are gross values before netting agreements and netting of cash collateral.
June 30December 31
Evergy20262025
Non-hedging derivativesBalance sheet location
Commodity contracts(millions)
PowerOther assets - current$92.0 $40.8 
Other assets - long-term44.8 35.1 
Natural gasOther assets - current6.7 6.4 
Total derivative assets$143.5 $82.3 
Commodity contracts
PowerOther liabilities - current$60.7 $30.8 
Other liabilities - long-term47.8 37.0 
Natural gasOther liabilities - current7.5 6.7 
Other liabilities - long-term— 0.1 
Total derivative liabilities$116.0 $74.6 
June 30December 31
Evergy Kansas Central20262025
Non-hedging derivativesBalance sheet location
Commodity contracts(millions)
PowerOther assets - current$60.4 $33.4 
Other assets - long-term44.8 35.1 
Natural gasOther assets - current6.7 6.4 
Total derivative assets$111.9 $74.9 
Commodity contracts
PowerOther liabilities - current$59.3 $27.9 
Other liabilities - long-term47.8 37.0 
Natural gasOther liabilities - current7.5 6.7 
Other liabilities - long-term— 0.1 
Total derivative liabilities$114.6 $71.7 
June 30December 31
Evergy Metro20262025
Non-hedging derivativesBalance sheet location
Commodity contracts(millions)
PowerOther assets - current$29.2 $6.6 
Total derivative assets$29.2 $6.6 
Commodity contracts
PowerOther liabilities - current$1.0 $2.3 
Total derivative liabilities$1.0 $2.3 
The following tables present the line items on the Evergy Companies' consolidated balance sheets where non-hedging derivative assets and liabilities are reported. The gross amounts offset in the tables below show the effect of master netting arrangements and include collateral posted to offset the net position.
June 30, 2026EvergyEvergy Kansas CentralEvergy Metro
Non-hedging derivatives(millions)
Derivative Assets
Current
Gross amounts recognized$98.7 $67.1 $29.2 
Gross amounts offset(48.5)(47.2)(1.0)
Net amounts presented in other assets - current$50.2 $19.9 $28.2 
Long-Term
Gross amounts recognized$44.8 $44.8 $— 
Gross amounts offset(17.8)(17.8)— 
Net amounts presented in other assets - long-term$27.0 $27.0 $— 
Derivative Liabilities
Current
Gross amounts recognized$68.2 $66.8 $1.0 
Gross amounts offset(48.3)(46.9)(1.0)
Net amounts presented in other liabilities - current$19.9 $19.9 $— 
Long-Term
Gross amounts recognized$47.8 $47.8 $— 
Gross amounts offset(17.6)(17.6)— 
Net amounts presented in other liabilities - long-term$30.2 $30.2 $— 
December 31, 2025EvergyEvergy Kansas CentralEvergy Metro
Non-hedging derivatives(millions)
Derivative Assets
Current
Gross amounts recognized$47.2 $39.8 $6.6 
Gross amounts offset(29.9)(27.0)(2.3)
Net amounts presented in other assets - current$17.3 $12.8 $4.3 
Long-Term
Gross amounts recognized$35.1 $35.1 $— 
Gross amounts offset(8.0)(8.0)— 
Net amounts presented in other assets - long-term$27.1 $27.1 $— 
Derivative Liabilities
Current
Gross amounts recognized$37.5 $34.6 $2.3 
Gross amounts offset(29.3)(26.4)(2.3)
Net amounts presented in other liabilities - current$8.2 $8.2 $— 
Long-Term
Gross amounts recognized$37.1 $37.1 $— 
Gross amounts offset(7.5)(7.5)— 
Net amounts presented in other liabilities - long-term$29.6 $29.6 $— 
The following table summarizes the amounts of gain recognized in income for the change in fair value of derivatives not designated as hedging instruments for the Evergy Companies.
Three Months Ended
June 30		Year to Date
June 30
Non-hedging derivatives - Location of gain Contract type2026202520262025
Evergy(millions)
Operating revenuesCommodity$4.1 $10.1 $26.9 $15.8 
Total$4.1 $10.1 $26.9 $15.8 
Evergy Kansas Central
Operating revenuesCommodity$4.1 $10.1 $26.9 $15.8 
Total$4.1 $10.1 $26.9 $15.8 
The following table summarizes the gross notional contract amount by type for hedging derivative instruments.
Hedging derivatives - Cash flow hedgeNotional volume unit of measureJune 30December 31
20262025
Evergy(millions)
Interest rate swapsUSD$100.0 $100.0 
The fair value of Evergy's open hedging derivative positions and balance sheet classifications are summarized in the following table. The fair values represent both the gross and net impact of netting agreements and the netting of cash collateral.
Hedging derivatives - Cash flow hedgeBalance sheet locationJune 30December 31
20262025
Interest rate swaps(millions)
Other assets - long-term$1.2 $0.6 
Total derivative assets$1.2 $0.6 
Credit risk of the Evergy Companies' derivative instruments relates to the potential adverse financial impact resulting from non-performance by a counterparty of its contractual obligations. The Evergy Companies maintain credit policies and employ credit risk mitigation, such as collateral requirements or letters of credit, when necessary to minimize their overall credit risk and monitor exposure. Substantially all of the Evergy Companies' counterparty credit risk associated with derivative instruments relates to Evergy Kansas Central's non-regulated energy marketing activities. As of June 30, 2026, if counterparty groups completely failed to perform on contracts, Evergy's and Evergy Kansas Central's maximum exposure related to derivative assets was $31.8 million. As of June 30, 2026, the potential loss after the consideration of applicable master netting arrangements and collateral received for Evergy and Evergy Kansas Central was $25.7 million.
Certain of the Evergy Companies' derivative instruments contain collateral provisions that are tied to the Evergy Companies' credit ratings and may require the posting of collateral for various reasons, including if the Evergy Companies' credit ratings were to fall below investment grade. Substantially all of these derivative instruments relate to Evergy Kansas Central's non-regulated energy marketing activities. The aggregate fair value of all derivative instruments with credit-risk-related contingent features that were in a liability position as of June 30, 2026, was $36.9 million for which Evergy and Evergy Kansas Central have posted $3.4 million collateral in the normal course of business. If the credit-risk-related contingent features underlying these agreements were triggered as of June 30, 2026, Evergy and Evergy Kansas Central could be required to post an additional $30.8 million of collateral to their counterparties.