David Campbell
President and Chief Executive Officer at Evergy
Thanks, Lori, and good morning, everyone. I'll begin on slide five. I'm pleased to report that we had a solid first quarter as we delivered adjusted earnings per share of $0.58 compared to $0.55 in 2021. The increase in adjusted earnings over last year was driven primarily by higher transmission margin and lower operating expenses, partially offset by an increase in depreciation and amortization and higher income tax expense. Kirk will discuss these first quarter drivers in more detail. One of our objectives is to become widely recognized for operational excellence, which includes safety. Our strong safety culture drives both discipline and consistency in performance as well as cost management.
During the first quarter, our employees participated in a safety roadshow that included presentations at 70 sessions throughout our service territory. This continued focus on safety has contributed to a 68% reduction in OSHA recordable safety events relative to the first quarter of 2021. I would like to thank all Evergy employees for their focus on safety and their dedication to providing safe, reliable and affordable power to our customers. I would also like to congratulate our Wolf Creek nuclear plant for completing a project to store spent fuel in a concrete bunker adjacent to the plant. This is Wolf Creek's first dry cask fuel storage campaign, and the team did an excellent job managing the project.
With a solid start to the year, we are reaffirming our 2022 adjusted EPS guidance of $3.43 to $3.63 per share as well as our target long-term annual EPS growth rate of 6% to 8% from 2021 to 2025. Slide six highlights the core tenets of our strategy, affordability, reliability and sustainability. Keeping rates affordable is at the forefront of our thinking, given its importance to our customers, especially given current economic conditions. We've made clear progress in advancing the competitiveness of our regional rates over the last few years, and our plan is constructed to continue this trajectory.
We are closely monitoring and managing inflation in all aspects of our business, and regarding fuel cost inflation, in particular, we are well positioned relative to many other utilities, given our relatively lower level of natural gas exposure as natural gas comprises typically 5% or less of our generation fuel mix annually. We, like many of our peers, have revisited our commodity procurement and hedging practices in light of the increased volatility, which are at levels not seen for more than a decade. Ensuring reliability is also a core element of our strategy, along with SAIDI and SAIFI, this includes a focus on metrics relating to customer service, the commercial availability of our fleet, safety and all elements of our operations, including infrastructure investment.
This spring has brought resiliency to the forefront as high winds in our service territory have been significantly more prevalent than normal, including several days in recent weeks with wind gusts in the 50 to 60 miles per hour range. These types of conditions reinforce the importance of our ongoing transmission and distribution investments. With respect to sustainability, our track record includes reducing our carbon emissions by nearly 50% versus 2005 levels and providing nearly half of our energy from carbon-free sources. In January, we announced plans to build a 10-megawatt solar array at our Hawthorne Plant pending regulatory approval.
And in February, Evergy's cumulative wind power generation passed the 90 million-megawatt hour milestone. That's enough wind power to fuel more than 300 billion miles of electric vehicle travel. We will continue our generation transition towards cleaner energy, while always balancing affordability and reliability. On slide seven, I'll profile another element of our corporate strategy related to environmental, social and governance measures. Since forming Evergy in 2018, we've enhanced our ESG practices and disclosures, which have yielded significant progress in our third-party ESG scores, as reflected on the slide. For example, last year, we introduced our 2045 net-zero carbon target, with an interim goal of 70% reduction by 2030, building on our track record and trajectory of historical emissions reductions.
Beyond environmental policy, we've also taken a comprehensive approach to reviewing and updating our social and governance policies and related disclosures. Examples include a corporate human rights policy, improved board governance bylaws, expanded shareholder rights and a formalized water policy among many others. In addition, our Board has linked executive compensation to the successful execution of both environmental and diversity, equity and inclusion aspects of our business. We're proud of the advancements we've made to further demonstrate our commitment to leading ESG practices. We are focused on maintaining this momentum as we execute our plan and deliver sustainable results in the years ahead. Now before handing it over to Kirk, I'll conclude by discussing some of our key regulatory and legislative priorities on slide eight.
In Kansas, we recently reached a nonunanimous stipulation and agreement with key interveners for the winter storm Uri costs from February 2021. The settlement calls for the roughly $120 million of deferred extraordinary fuel, purchase power and nonfuel costs at Kansas Central to be recovered through our fuel costs over a two-year period beginning in April of next year. Similarly, the $37 million of net benefits of Kansas Metro will be returned to customers via the same method over a one-year period, also beginning in April 2023. We remain on track to file this summer, the annual update to our Kansas and Missouri integrated resource plans. We expect that the annual filing will be consistent with the resource plan that we laid out in last year's triennial IRP filing and the renewable development plan that Kirk discussed during our Investor Day last September.
In Missouri, we initiated the securitization process to recover the approximately $300 million of winter storm Uri cost in Missouri West. If approved, securitization will extend the recovery period for these costs over 15 years and thereby, significantly moderate the impacts on customers. In terms of timing, we expect an order and the securitization proceeding in the fall of this year. And last month, we began flowing the approximately $25 million of net benefits from Uri back to Missouri Metro customers. This benefit will be shared over a one-year period. I'll wrap up the slide with an update on our legislative efforts to enhance and extend the planned and service accounting law known as PISA in Missouri.
The bill under consideration sets an annual revenue requirement cap at 2.5%, applicable only to PISA-related deferrals. Bill also includes a property tax tracker and extends the law through 2028 with the opportunity for extension through 2033 with commission approval. We are encouraged by the support the bill has received in both the Senate and House, and we'll continue to work with legislators and parties to secure passage over the next 10 days. With respect to the pending Missouri rate case, we expect to receive intervenor direct testimony on June eight related to revenue requirements and on June 22, relating to rate design aspects, with rebuttal testimony due mid-July and surrebuttal testimony due mid-August.
A settlement conference is scheduled for August 22, with hearings later that month through early September. Revised rates in Missouri will go effective on December 2. We look forward to working with parties to constructively resolve the case.
I will now turn the call over to Kirk.
