A new electric vehicle battery factory in Kansas will require so much energy that a coal plant slated for closure will now remain open, plus it will be expanded.
Panasonic is building a $4 billion EV battery factory in De Soto, Kansas. The upcoming lithium-ion battery manufacturing facility is expected to start mass production of EV batteries by the end of March 2025.
Despite the massive $4 billion price tag for the 2.7 million square-foot Panasonic facility, the Japanese company is "poised to get as much as $6.8 billion from provisions in last year’s federal Inflation Reduction Act," according to a July report from the Kansas City Star. The Japanese company is expected to receive state and local incentives – pushing the total financial incentives to as much as $8 billion.
This massive EV battery factory will require enormous amounts of power. So much energy, in fact, that a local coal-fired plant will be expanded and the life of the plant will be extended.
The EV battery factory will reportedly require between 200 and 250 megawatts of electricity to operate – roughly the same amount of power needed for a small city.
The plant in Lawrence is owned by Evergy – an investor-owned energy company serving more than 1.6 million customers across Kansas and Missouri.
Evergy had reportedly planned to close its coal-fired Unit 4 at the Lawrence Energy Center in late 2023 or early 2024. However, Evergy is extending the life of the coal plant in Lawrence "until 2028 and would then transition Unit 5 to gas to provide power at times of high demand," the Kansas City Star reported.
"The demand created by the nearly 4-million-square-foot plant in Johnson County is expected to double that of Evergy’s current largest customer in the state and require two new substations, upgrades to three current substations and work on 31 miles of transmission lines," according to the outlet.
Kayla Messamore – Evergy’s vice president of strategy and long-term planning – admitted during testimony that the electric car battery plant will present "near-term challenges from a resource adequacy perspective."
"Beyond the sheer magnitude of load and load factor, Panasonic’s construction schedule, and, in turn, its energy needs, are being planned on a very aggressive schedule," Messamore said. "With energy needs starting to ramp in 2024 and full load requirements by 2026, there is urgency to procure capacity and energy to fulfill the expected energy usage schedule."
Carl Walton – Panasonic Energy of North America’s vice president of strategic initiatives and facilities – said, "Panasonic is making a significant investment in upgrading Evergy’s infrastructure to be able to serve the factory, and we will pay for all costs immediately attributable to our operations."
Panasonic is expected to receive a discounted electric rate that is offered to economic development projects.
Evergy had already filed for a rate hike for its customers with state regulators. The rate hike was largely denied by the Kansas Corporation Commission.
However, regulators allegedly agreed that Evergy "should be permitted to petition for another rate increase next year, as the utility has said those may be needed to accommodate Panasonic’s new battery plant in De Soto. In its initial rate-increase request, Evergy had said the company wanted to make adjustments to accommodate the power load for the plant."
Evergy spokesperson Gina Penzig said over 50% of the utility's power generation is carbon-free, but "the grid still needs baseload energy for times when intermittent fuels are not operating."
The factory is said to employ approximately 4,000 workers.
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