CWA, Public Citizen Protest Lack of Transparency Between Evergy and Two Major Hedge Funds

The Communications Workers of America (CWA) and Public Citizen file a protest complaint with FERC, as the Commission investigates the relationship between Evergy, Inc, Elliott Management, and Bluescape Energy Partners;

Protest comment calls for greater transparency into the relationship between Evergy and two hedge funds, as collaboration could have a devastating outcome for ratepayers;

WASHINGTON — After extensive research pointed to the potentially problematic control of Evergy, Inc (NYSE: EVRG) by Elliott Management and Bluescape Energy Partners, the Communications Workers of America (CWA) and Public Citizen filed a protest comment with the Federal Energy Regulatory Commission (FERC) to demand greater transparency into Evergy’s relationship with the two hedge funds. In addition to a concerning relationship between the company and the two large hedge funds, their collaboration has the potential to result in higher electricity costs for ratepayers.

While FERC’s deficiency letter required more detail about Evergy’s relationship with the hedge funds, the company’s response failed to document the extensive history of collaboration between Elliott and Bluescape. It also omitted any documentation of contractual agreements between the two hedge funds. Friday’s protest comment explicitly called on Evergy to provide additional information to determine whether there is an absence of arms-length bargaining that makes it necessary for FERC to treat Elliott and Bluescape as legal affiliates of the company.

“Public Citizen has been calling for more transparency into what we consider a problematic relationship between Evergy, Elliott, and Bluescape for months,” said Tyson Slocum, director of Public Citizen’s Energy Program. “After Evergy failed to appropriately respond to a FERC deficiency letter in October with more details about its relationship with the hedge funds and the hedge funds’ relationship with one another, CWA joined us in pushing back once again. All Evergy stakeholders have a right to know just how much control Elliott and Bluescape hold over the company, and we’re determined to bring that information to light.”

The protest comment cites the following as reasons for additional transparency:

• Evergy’s October response failed to document the extensive history of collaboration between Elliott and Bluescape, despite the hedge funds’ previous collaboration to influence several FERC-jurisdictional utilities without ever notifying the Commission.

• At least four of Evergy’s board members were selected by the hedge funds, including Bluescape’s Executive Chairman, C. John Wilder.

• The four Elliott/Bluescape selected board members are all members of Evergy’s five-person Finance Committee, chaired by C. John Wilder. The Finance Committee was designated as the primary driver of management and investment decision-making for the entire company in a 2021 agreement with Bluescape.

• Both Bluescape and Elliott have significant holdings and, in some cases, material, non-public agreements with Evergy’s competitors, threatening market power and competition.

• Elliott Management’s Peabody Energy affiliate has fuel-supply contracts with Evergy, threatening just and reasonable rates.

• Evergy and Elliott Management entered into a cooperation agreement that gave Elliott sweeping rights to material, non-public information about Evergy’s business operations. That cooperation agreement has never been made public.

“The ties between Evergy, Elliott, and Bluescape are deeply concerning, and FERC needs additional information to understand just how much influence these hedge funds hold over Evergy,” said Hudson Muñoz, a Senior Strategic Research Associate at the Communications Workers of America. “This is not the first time Elliott and Bluescape have partnered up, and the stakes are high if they are following Elliott’s agenda for cash extraction that jeopardizes quality of service and reasonable rates. The results could lead to higher costs for ratepayers and leave workers, shareholders, and other stakeholders in a vulnerable position, which is why it’s so important that we learn more than Evergy has provided to the Commission thus far.”

In June, Public Citizen filed an initial comment with FERC, calling for greater transparency into Evergy’s relationship with the two hedge funds. Friday’s protest comment calls for FERC to compel Evergy to turn over all formal written agreements between Elliott Management and Bluescape Energy Partners related to their mutual investment in utilities under FERC’s jurisdiction. If no such written agreement exists, then FERC must compel sworn statements from Bluescape’s C. John Wilder, Elliott Management’s Paul Singer, and their staffs, detailing all arrangements between the two hedge funds with regards to Evergy.

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About Public Citizen: Established in 1971, Public Citizen advocates on behalf of families to ensure equitable, affordable, reliable, and sustainable access to energy. We are active at the Federal Energy Regulatory Commission to make sure households have access to just and reasonable rates, and to hold utilities accountable to the public interest.

About CWA: The Communications Workers of America represents working people in telecommunications, customer service, media, airlines, health care, public service and education, and manufacturing.