UNITED
      STATES


SECURITIES
      AND EXCHANGE COMMISSION


Washington,
      D.C. 20549





**Form
      10-Q**







[X]
      QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES


EXCHANGE
      ACT OF 1934





For
      the
      quarterly period ended **March
      31, 2006**





or





[
      ]
      TRANSITION REPORT PURSUANT SECTION 13 OR 15(d) OF THE SECURITIES


EXCHANGE
      ACT OF 1934





For
      the
      transition period from _______ to _______





**Exact
                name of registrant as specified in charter,****Commission**
            
            **state
                of incorporation, address of principal**
            
            **I.R.S.
                Employer****File
                Number**
            
            **executive
                offices and telephone number**
            
            **Identification
                Number**001-32206
            
            **GREAT
                PLAINS ENERGY INCORPORATED**
            
            43-1916803(A
                Missouri Corporation)1201
                Walnut StreetKansas
                City, Missouri 64106(816)
                556-2200www.greatplainsenergy.com000-51873
            
            **KANSAS
                CITY POWER & LIGHT COMPANY**
            
            44-0308720(A
                Missouri Corporation)1201
                Walnut StreetKansas
                City, Missouri 64106(816)
                556-2200www.kcpl.com







Indicate
                by check mark whether the registrant (1) has filed all reports required
                to
                be filed by Section 13 or 15(d) of theSecurities
                Exchange Act of 1934 during the preceding 12 months (or for such
                shorter
                period that the registrant was required tofile
                such reports), and (2) has been subject to such filing requirements
                for
                the past 90 days.Great
                Plains Energy Incorporated
            Yes
            X
            No
            _
            
            Kansas
                City Power & Light Company
            Yes
            _
            No
            XIndicate
                by check mark whether the registrant is a large accelerated filer,
                an
                accelerated filer, or a non-accelerated filer. Seedefinition
                of “accelerated filer and large accelerated filer” in Rule 12b-2 of the
                Exchange Act.Great
                Plains Energy Incorporated
            Large
                accelerated filer
            X
            Accelerated
                filer
            _
            Non-accelerated
                filer
            _Kansas
                City Power & Light Company
            Large
                accelerated filer
            _
            Accelerated
                filer
            _
            Non-accelerated
                filer
            XIndicate
                by check mark whether the registrant is a shell company (as defined
                in
                Rule 12b-2 of the Exchange Act).Great
                Plains Energy Incorporated
            Yes
            _
            No
            X
            
            Kansas
                City Power & Light Company
            Yes
            _
            No
            XOn
                May 1, 2006, Great Plains Energy Incorporated had 74,904,567 shares
                of
                common stock outstanding.On
                May 1, 2006, Kansas City Power & Light Company had one share of common
                stock outstanding, which was held byGreat
                Plains Energy Incorporated.







Great
      Plains Energy Incorporated and Kansas City Power & Light Company (KCP&L)
      separately file this combined Quarterly Report on Form 10-Q. Information
      contained herein relating to an individual registrant and its subsidiaries
      is
      filed by such registrant on its own behalf. Each registrant makes
      representations only as to information relating to itself and its
      subsidiaries.





In
      March
      2006, KCP&L filed a registration statement to register its common stock
      under Section 12(g) of the Securities Exchange Act of 1934, as amended (Exchange
      Act). This registration statement became effective in April 2006 and KCP&L
      is now required to file reports, including quarterly reports on Form 10-Q,
      under
      Section 13(a) of the Exchange Act.





This
      report should be read in its entirety. No one section of the report deals with
      all aspects of the subject matter. It should be read in conjunction with the
      consolidated financial statements and related notes and with the management’s
      discussion and analysis included in the companies’ 2005 Form 10-K.





**CAUTIONARY
      STATEMENTS REGARDING CERTAIN FORWARD-LOOKING INFORMATION**


Statements
      made in this report that are not based on historical facts are forward-looking,
      may involve risks and uncertainties, and are intended to be as of the date
      when
      made. Forward-looking statements include, but are not limited to, statements
      regarding projected delivered volumes and margins, the outcome of regulatory
      proceedings, cost estimates of the comprehensive energy plan and other matters
      affecting future operations. In connection with the safe harbor provisions
      of
      the Private Securities Litigation Reform Act of 1995, the registrants are
      providing a number of important factors that could cause actual results to
      differ materially from the provided forward-looking information. These important
      factors include: future economic conditions in the regional, national and
      international markets, including but not limited to regional and national
      wholesale electricity markets; market perception of the energy industry and
      Great Plains Energy; changes in business strategy, operations or development
      plans; effects of current or proposed state and federal legislative and
      regulatory actions or developments, including, but not limited to, deregulation,
      re-regulation and restructuring of the electric utility industry; decisions
      of
      regulators regarding rates KCP&L can charge for electricity; adverse changes
      in applicable laws, regulations, rules, principles or practices governing tax,
      accounting and environmental matters including, but not limited to, air and
      water quality; financial market conditions and performance including, but not
      limited to, changes in interest rates and in availability and cost of capital
      and the effects on pension plan assets and costs; credit ratings; inflation
      rates; effectiveness of risk management policies and procedures and the ability
      of counterparties to satisfy their contractual commitments; impact of terrorist
      acts; increased competition including, but not limited to, retail choice in
      the
      electric utility industry and the entry of new competitors; ability to carry
      out
      marketing and sales plans; weather conditions including weather-related damage;
      cost, availability, quality and deliverability of fuel; ability to achieve
      generation planning goals and the occurrence and duration of unplanned
      generation outages; delays in the anticipated in-service dates and cost
      increases of additional generating capacity; nuclear operations; ability to
      enter new markets successfully and capitalize on growth opportunities in
      non-regulated businesses and the effects of competition; application of critical
      accounting policies, including, but not limited to, those related to derivatives
      and pension liabilities; workforce risks including compensation and benefits
      costs; performance of projects undertaken by non-regulated businesses and the
      success of efforts to invest in and develop new opportunities and other risks
      and uncertainties.




This
      list
      of factors is not all-inclusive because it is not possible to predict all
      factors. Part II Item 1A. Risk Factors included in this report should be
      carefully read for further understanding of potential risks to the companies.
      Other sections of this report and other periodic reports filed by the companies
      with the Securities and Exchange Commission (SEC) should also be read for more
      information regarding risk factors.


2


**GLOSSARY
      OF TERMS**




The
      following is a glossary of frequently used abbreviations or acronyms that are
      found throughout this report.





**Abbreviation
                or Acronym**
            
            **Definition****BART**
            
            Best
                available retrofit technology**CAIR**
            
            Clean
                Air Interstate Rule**CAMR**
            
            Clean
                Air Mercury Rule**CO****2**
            
            Carbon
                Dioxide**Company**
            
            Great
                Plains Energy Incorporated and its subsidiaries**Consolidated
                KCP&L**
            
            KCP&L
                and its wholly owned subsidiaries**Digital
                Teleport**
            
            Digital
                Teleport, Inc.**DOE**
            
            Department
                of Energy**DTI**
            
            DTI
                Holdings, Inc. and its subsidiaries, Digital Teleport,
                Inc.and
                Digital Teleport of Virginia, Inc.**EBITDA**
            
            Earnings
                before interest, income taxes, depreciation and
                amortization**EEI**
            
            Edison
                Electric Institute**EIRR**
            
            Environmental
                Improvement Revenue Refunding**EPA**
            
            Environmental
                Protection Agency**EPS**
            
            Earnings
                (loss) per common share**FASB**
            
            Financial
                Accounting Standards Board**FELINE
                PRIDES****SM**
            
            Flexible
                Equity Linked Preferred Increased Dividend Equity Securities,a
                service mark of Merrill Lynch & Co., Inc.**FERC**
            
            The
                Federal Energy Regulatory Commission**Great
                Plains Energy**
            
            Great
                Plains Energy Incorporated and its subsidiaries**Holdings**
            
            DTI
                Holdings, Inc.**HSS**
            
            Home
                Service Solutions Inc., a wholly owned subsidiary of KCP&L**IEC**
            
            Innovative
                Energy Consultants Inc., a wholly owned subsidiaryof
                Great Plains Energy**ISO**
            
            Independent
                System Operator**KCC**
            
            The
                State Corporation Commission of the State of Kansas**KCP&L**
            
            Kansas
                City Power & Light Company, a wholly owned
                subsidiaryof
                Great Plains Energy**KLT
                Gas**
            
            KLT
                Gas Inc., a wholly owned subsidiary of KLT Inc.**KLT
                Inc.**
            
            KLT
                Inc., a wholly owned subsidiary of Great Plains Energy**KLT
                Investments**
            
            KLT
                Investments Inc., a wholly owned subsidiary of KLT Inc.**KLT
                Telecom**
            
            KLT
                Telecom Inc., a wholly owned subsidiary of KLT Inc.**KW**
            
            Kilowatt**kWh**
            
            Kilowatt
                hour**MAC**
            
            Material
                Adverse Change**MD&A**
            
            Management’s
                Discussion and Analysis of Financial Condition andResults
                of Operations**MISO**
            
            Midwest
                Independent Transmission System Operator, Inc.**MPSC**
            
            Public
                Service Commission of the State of Missouri**MW**
            
            Megawatt


3


**Abbreviation
                or Acronym**
            
            **Definition****MWh**
            
            Megawatt
                hour**NEIL**
            
            Nuclear
                Electric Insurance Limited**NO****x**
            
            Nitrogen
                Oxide**NPNS**
            
            Normal
                Purchases and Normal Sales**NRC**
            
            Nuclear
                Regulatory Commission**OCI**
            
            Other
                Comprehensive Income**PJM**
            
            PJM
                Interconnection**PRB**
            
            Powder
                River Basin**Receivables
                Company**
            
            Kansas
                City Power & Light Receivables Company, a wholly
                ownedsubsidiary
                of KCP&L**RTO**
            
            Regional
                Transmission Organization**SEC**
            
            Securities
                and Exchange Commission**SECA**
            
            Seams
                Elimination Charge Adjustment**SE
                Holdings**
            
            SE
                Holdings, L.L.C.**Services**
            
            Great
                Plains Energy Services Incorporated**SFAS**
            
            Statement
                of Financial Accounting Standards**SIP**
            
            State
                Implementation Plan**SO****2**
            
            Sulfur
                Dioxide**SPP**
            
            Southwest
                Power Pool, Inc.**STB**
            
            Surface
                Transportation Board**Strategic
                Energy**
            
            Strategic
                Energy, L.L.C., a subsidiary of KLT Energy Services**T
                - Lock**
            
            Treasury
                Lock**Union
                Pacific**
            
            Union
                Pacific Railroad Company**WCNOC**
            
            Wolf
                Creek Nuclear Operating Corporation**Wolf
                Creek**
            
            Wolf
                Creek Generating Station**Worry
                Free**
            
            Worry
                Free Service, Inc., a wholly owned subsidiary of
                HSS


4


**PART
      I - FINANCIAL INFORMATION**


**ITEM
        1. CONSOLIDATED FINANCIAL STATEMENTS**
 
 **GREAT
                      PLAINS ENERGY****Consolidated
                      Balance Sheets**(Unaudited)**March
                      31**
                  
                  December
                      31**2006**
                  
                  2005**ASSETS**
                  (thousands)**Current
                      Assets**Cash
                      and cash equivalents
                  **$**
                  **87,553**
                  
                  $
                  103,068Restricted
                      cash
                  
                  **-**
                  
                  
                  1,900Receivables,
                      net
                  
                  **241,792**
                  
                  
                  259,043Fuel
                      inventories, at average cost
                  
                  **21,186**
                  
                  
                  17,073Materials
                      and supplies, at average cost
                  
                  **57,556**
                  
                  
                  57,017Deferred
                      income taxes
                  
                  **19,783**
                  
                  
                  -Assets
                      of discontinued operations
                  
                  **-**
                  
                  
                  627Derivative
                      instruments
                  
                  **15,753**
                  
                  
                  39,189Other
                  
                  **13,248**
                  
                  
                  13,001Total
                  
                  **456,871**
                  
                  
                  490,918**Nonutility
                      Property and Investments**Affordable
                      housing limited partnerships
                  
                  **26,302**
                  
                  
                  28,214Nuclear
                      decommissioning trust fund
                  
                  **95,063**
                  
                  
                  91,802Other
                  
                  **16,961**
                  
                  
                  17,291Total
                  
                  **138,326**
                  
                  
                  137,307**Utility
                      Plant, at Original Cost**Electric
                  
                  **4,999,326**
                  
                  
                  4,959,539Less-accumulated
                      depreciation
                  
                  **2,354,984**
                  
                  
                  2,322,813Net
                      utility plant in
                      service
                  
                  **2,644,342**
                  
                  
                  2,636,726Construction
                      work in progress
                  
                  **123,881**
                  
                  
                  100,952Nuclear
                      fuel, net of amortization of $119,130 and
                      $115,240
                  
                  **34,849**
                  
                  
                  27,966Total
                  
                  **2,803,072**
                  
                  
                  2,765,644**Deferred
                      Charges and Other Assets**Regulatory
                      assets
                  
                  **188,383**
                  
                  
                  179,922Prepaid
                      pension costs
                  
                  **87,763**
                  
                  
                  98,295Goodwill
                  
                  **88,139**
                  
                  
                  87,624Derivative
                      instruments
                  
                  **8,628**
                  
                  
                  21,812Other
                  
                  **47,668**
                  
                  
                  52,204Total
                  
                  **420,581**
                  
                  
                  439,857Total
                  **$**
                  **3,818,850**
                  
                  $
                  3,833,726The
                      accompanying Notes to Consolidated Financial Statements are
                      an integral part of these
                      statements.
  5
 **GREAT
                    PLAINS ENERGY****Consolidated
                    Balance Sheets**(Unaudited)**March
                    31**
                
                December
                    31**2006**
                
                2005**LIABILITIES
                    AND CAPITALIZATION**
                (thousands)**Current
                    Liabilities**Notes payable
                **$**
                **-**
                
                $
                6,000Commercial paper
                
                **73,800**
                
                
                31,900Current maturities of long-term debt
                
                **390,275**
                
                
                1,675Accounts payable
                
                **205,435**
                
                
                231,496Accrued taxes
                
                **41,593**
                
                
                37,140Accrued interest
                
                **13,102**
                
                
                13,329Accrued payroll and vacations
                
                **31,054**
                
                
                36,024Accrued refueling outage costs
                
                **12,148**
                
                
                8,974Deferred income taxes
                
                **-**
                
                
                1,351Supplier collateral
                
                **-**
                
                
                1,900Liabilities of discontinued operations
                
                **-**
                
                
                64Derivative instruments
                
                **31,623**
                
                
                7,411Other
                
                **24,821**
                
                
                25,658Total
                
                **823,851**
                
                
                402,922**Deferred
                    Credits and Other Liabilities**Deferred income taxes
                
                **610,073**
                
                
                621,359Deferred investment tax credits
                
                **28,937**
                
                
                29,698Asset retirement obligations
                
                **148,294**
                
                
                145,907Pension liability
                
                **87,919**
                
                
                87,355Regulatory liabilities
                
                **71,284**
                
                
                69,641Derivative instruments
                
                **18,652**
                
                
                7,750Other
                
                **64,141**
                
                
                65,787Total
                
                **1,029,300**
                
                
                1,027,497**Capitalization**Common shareholders' equityCommon stock-150,000,000 shares authorized without par
                    value74,931,157 and 74,783,824 shares issued, stated value
                
                **747,903**
                
                
                744,457Retained earnings
                
                **454,308**
                
                
                488,001Treasury stock-44,836 and 43,376 shares, at cost
                
                **(1,346**
                **)**
                
                (1,304
                )Accumulated other comprehensive loss
                
                **(25,925**
                **)**
                
                (7,727
                )Total
                
                **1,174,940**
                
                
                1,223,427Cumulative preferred stock $100 par value3.80% - 100,000 shares issued
                
                **10,000**
                
                
                10,0004.50% - 100,000 shares issued
                
                **10,000**
                
                
                10,0004.20% - 70,000 shares issued
                
                **7,000**
                
                
                7,0004.35% - 120,000 shares issued
                
                **12,000**
                
                
                12,000Total
                
                **39,000**
                
                
                39,000Long-term debt (Note 8)
                
                **751,759**
                
                
                1,140,880Total
                
                **1,965,699**
                
                
                2,403,307**Commitments
                    and Contingencies (Note 13)**Total
                **$**
                **3,818,850**
                
                $
                3,833,726The
                    accompanying Notes to Consolidated Financial Statements are an
                    integral
                    part of these statements.
  6
  **GREAT
                  PLAINS ENERGY****Consolidated
                  Statements of Income**(Unaudited)**Three
                  Months Ended March 31**
              **2006**
              
              2005**Operating
                  Revenues**
              (thousands)Electric revenues - KCP&L
              **$**
              **240,390**
              
              $
              233,215Electric revenues - Strategic Energy
              
              **318,012**
              
              
              311,316Other revenues
              
              **783**
              
              
              583Total
              
              **559,185**
              
              
              545,114**Operating
                  Expenses**Fuel
              
              **47,400**
              
              
              41,490Purchased power - KCP&L
              
              **5,117**
              
              
              11,490Purchased power - Strategic Energy
              
              **325,758**
              
              
              277,866Skill set realignment costs (Note 9)
              
              **9,393**
              
              
              -Other
              
              **76,235**
              
              
              79,895Maintenance
              
              **22,590**
              
              
              29,358Depreciation and amortization
              
              **38,946**
              
              
              37,862General taxes
              
              **27,644**
              
              
              25,856(Gain) loss on property
              
              **99**
              
              
              (519
              )Total
              
              **553,182**
              
              
              503,298Operating
                  income
              
              **6,003**
              
              
              41,816Non-operating
                  income
              
              **2,985**
              
              
              1,924Non-operating
                  expenses
              
              **(2,141**
              **)**
              
              (1,315
              )Interest
                  charges
              
              **(17,323**
              **)**
              
              (17,487
              )Income
                  (loss) before income taxes, minority interest insubsidiaries and loss from equity investments
              
              **(10,476**
              **)**
              
              24,938Income
                  taxes
              
              **8,630**
              
              
              (5,291
              )Minority
                  interest in subsidiaries
              
              **-**
              
              
              888Loss
                  from equity investments, net of income taxes
              
              **(290**
              **)**
              
              (345
              )Net
                  income (loss)
              
              **(2,136**
              **)**
              
              20,190Preferred
                  stock dividend requirements
              
              **411**
              
              
              411Earnings
                  (loss) available for common shareholders
              **$**
              **(2,547**
              **)**
              $
              19,779Average
                  number of common shares outstanding
              
              **74,659**
              
              
              74,436Basic
                  and diluted earnings (loss) per common share
              **$**
              **(0.03**
              **)**
              $
              0.27Cash
                  dividends per common share
              **$**
              **0.415**
              
              $
              0.415The
                  accompanying Notes to Consolidated Financial Statements are an
                  integral
                  part of these statements.
  7
  **GREAT
                  PLAINS ENERGY****Consolidated
                  Statements of Cash Flows**(Unaudited)Revised**Three
                  Months Ended March 31**
              **2006**
              
              2005**Cash
                  Flows from Operating Activities**
              (thousands)Net
                  income (loss)
              **$**
              **(2,136**
              **)**
              $
              20,190Adjustments
                  to reconcile income to net cash from operating activities:Depreciation and amortization
              
              **38,946**
              
              
              37,862Amortization of:Nuclear fuel
              
              **3,890**
              
              
              3,277Other
              
              **2,334**
              
              
              2,659Deferred income taxes, net
              
              **(17,045**
              **)**
              
              10,284Investment tax credit amortization
              
              **(761**
              **)**
              
              (972
              )Loss from equity investments, net of income taxes
              
              **290**
              
              
              345(Gain) loss on property
              
              **99**
              
              
              (519
              )Minority interest in subsidiaries
              
              **-**
              
              
              (888
              )Fair value impacts from energy contracts
              
              **35,874**
              
              
              (4,998
              )Other
                  operating activities (Note 4)
              
              **(4,067**
              **)**
              
              (60,437
              )Net cash from operating activities
              
              **57,424**
              
              
              6,803**Cash
                  Flows from Investing Activities**Utility
                  capital expenditures
              
              **(73,899**
              **)**
              
              (32,295
              )Allowance
                  for borrowed funds used during construction
              
              **(898**
              **)**
              
              (435
              )Purchases
                  of investments
              
              **(700**
              **)**
              
              (14,976
              )Purchases
                  of nonutility property
              
              **(1,358**
              **)**
              
              (1,601
              )Proceeds
                  from sale of assets and investments
              
              **109**
              
              
              15,064Purchases
                  of nuclear decommissioning trust investments
              
              **(15,586**
              **)**
              
              (7,912
              )Proceeds
                  from nuclear decommissioning trust investments
              
              **14,698**
              
              
              7,024Hawthorn
                  No. 5 partial insurance recovery
              
              **-**
              
              
              10,000Other
                  investing activities
              
              **(791**
              **)**
              
              (2,216
              )Net cash from investing activities
              
              **(78,425**
              **)**
              
              (27,347
              )**Cash
                  Flows from Financing Activities**Issuance
                  of common stock
              
              **2,599**
              
              
              3,971Issuance
                  fees
              
              **(32**
              **)**
              
              (8
              )Net
                  change in short-term borrowings
              
              **35,900**
              
              
              6,200Dividends
                  paid
              
              **(31,516**
              **)**
              
              (31,303
              )Other
                  financing activities
              
              **(1,465**
              **)**
              
              (1,400
              )Net cash from financing activities
              
              **5,486**
              
              
              (22,540
              )**Net
                  Change in Cash and Cash Equivalents**
              
              **(15,515**
              **)**
              
              (43,084
              )**Less:
                  Net Change in Cash and Cash Equivalents from****Discontinued Operations**
              
              **-**
              
              
              (626
              )**Cash
                  and Cash Equivalents at Beginning of Year**
              
              **103,068**
              
              
              127,129**Cash
                  and Cash Equivalents at End of Period**
              **$**
              **87,553**
              
              $
              84,671The
                  accompanying Notes to Consolidated Financial Statements are an
                  integral
                  part of these statements.
  8
  **GREAT
                    PLAINS ENERGY****Consolidated
                    Statements of Common Shareholders' Equity**(Unaudited)**Three
                    Months Ended March 31**
                **2006**
                
                2005**Shares**
                
                **Amount**
                
                Shares
                
                Amount**Common
                    Stock**
                (thousands,
                    except share amounts)Beginning
                    balance
                
                **74,783,824**
                
                **$**
                **744,457**
                
                
                74,394,423
                
                $
                731,977Issuance
                    of common stock
                
                **100,507**
                
                
                **2,599**
                
                
                145,340
                
                
                3,972Issuance
                    of restricted common stock
                
                **46,826**
                
                
                **1,320**
                
                
                47,729
                
                
                1,445Equity
                    compensation expense
                
                
                
                
                **510**
                
                
                
                
                
                280Unearned
                    CompensationIssuance
                    of restricted common stock
                
                
                
                
                **(1,320**
                **)**
                
                
                
                
                (1,445
                )Compensation
                    expense recognized
                
                
                
                
                **306**
                
                
                
                
                
                319Other
                
                
                
                
                **31**
                
                
                
                
                
                54Ending balance
                
                **74,931,157**
                
                
                **747,903**
                
                
                74,587,492
                
                
                736,602**Retained
                    Earnings**Beginning
                    balance
                
                
                
                
                **488,001**
                
                
                
                
                
                451,491Net
                    income (loss)
                
                
                
                
                **(2,136**
                **)**
                
                
                
                
                20,190Dividends:Common stock
                
                
                
                
                **(31,057**
                **)**
                
                
                
                
                (30,892
                )Preferred stock - at required rates
                
                
                
                
                **(411**
                **)**
                
                
                
                
                (411
                )Performance shares
                
                
                
                
                **(89**
                **)**
                
                
                
                
                -Ending balance
                
                ****
                
                
                **454,308**
                
                
                
                
                
                440,378**Treasury
                    Stock**Beginning
                    balance
                
                **(43,376**
                **)**
                
                **(1,304**
                **)**
                
                (28,488
                )
                
                (856
                )Treasury
                    shares acquired
                
                **(1,460**
                **)**
                
                **(42**
                **)**
                
                -
                
                
                -Ending balance
                
                **(44,836**
                **)**
                
                **(1,346**
                **)**
                
                (28,488
                )
                
                (856
                )**Accumulated
                    Other Comprehensive Loss**Beginning
                    balance
                
                
                
                
                **(7,727**
                **)**
                
                
                
                
                (41,018
                )Derivative
                    hedging activity, net of tax
                
                
                
                
                **(18,198**
                **)**
                
                
                
                
                8,724Minimum
                    pension obligation, net of tax
                
                
                
                
                **-**
                
                
                
                
                
                (37
                )Ending balance
                
                ****
                
                
                **(25,925**
                **)**
                
                
                
                
                (32,331
                )**Total
                    Common Shareholders' Equity**
                
                ****
                
                **$**
                **1,174,940**
                
                
                ****
                
                $
                1,143,793The
                    accompanying Notes to Consolidated Financial Statements are an
                    integral
                    part of these statements.
  9
  **GREAT
                    PLAINS ENERGY****Consolidated
                    Statements of Comprehensive Income**(Unaudited)**Three
                    Months Ended March 31**
                **2006**
                
                2005(thousands)Net
                    income (loss)
                **$**
                **(2,136**
                **)**
                $
                20,190Other
                    comprehensive incomeGain (loss) on derivative hedging instruments
                
                **(40,703**
                **)**
                
                18,856Income taxes
                
                **17,283**
                
                
                (8,047
                )Net gain (loss) on derivative hedging instruments
                
                **(23,420**
                **)**
                
                10,809Reclassification to expenses, net of tax
                
                **5,222**
                
                
                (2,085
                )Derivative hedging activity, net of tax
                
                **(18,198**
                **)**
                
                8,724Change in minimum pension obligation
                
                **-**
                
                
                (60
                )Income taxes
                
                **-**
                
                
                23Net change in minimum pension obligation
                
                **-**
                
                
                (37
                )Comprehensive
                    income (loss)
                **$**
                **(20,334**
                **)**
                $
                28,877The
                    accompanying Notes to Consolidated Financial Statements are an
                    integral
                    part of these statements.
  10
  **KANSAS
                    CITY POWER & LIGHT COMPANY****Consolidated
                    Balance Sheets**(Unaudited)**March
                    31**
                
                December
                    31**2006**
                
                2005**ASSETS**
                (thousands)**Current
                    Assets**Cash and cash equivalents
                **$**
                **2,718**
                
                $
                2,961Receivables, net
                
                **65,103**
                
                
                70,264Fuel inventories, at average cost
                
                **21,186**
                
                
                17,073Materials and supplies, at average cost
                
                **57,556**
                
                
                57,017Deferred income taxes
                
                **10,216**
                
                
                8,944Prepaid expenses
                
                **11,417**
                
                
                11,292Derivative instruments
                
                **3,787**
                
                
                -Total
                
                **171,983**
                
                
                167,551**Nonutility
                    Property and Investments**Nuclear decommissioning trust fund
                
                **95,063**
                
                
                91,802Other
                
                **7,498**
                
                
                7,694Total
                
                **102,561**
                
                
                99,496**Utility
                    Plant, at Original Cost**Electric
                
                **4,999,326**
                
                
                4,959,539Less-accumulated depreciation
                
                **2,354,984**
                
                
                2,322,813Net utility plant in service
                
                **2,644,342**
                
                
                2,636,726Construction work in progress
                
                **123,881**
                
                
                100,952Nuclear fuel, net of amortization of $119,130 and $115,240
                
                **34,849**
                
                
                27,966Total
                
                **2,803,072**
                
                
                2,765,644**Deferred
                    Charges and Other Assets**Regulatory assets
                
                **188,383**
                
                
                179,922Prepaid pension costs
                
                **87,763**
                
                
                98,002Other
                
                **27,504**
                
                
                27,905Total
                
                **303,650**
                
                
                305,829Total
                **$**
                **3,381,266**
                
                $
                3,338,520The
                    disclosures regarding consolidated KCP&L included in the accompanying
                    Notes to Consolidated FinancialStatements
                    are an integral part of these statements.
  11
  **KANSAS
                      CITY POWER & LIGHT COMPANY****Consolidated
                      Balance Sheets**(Unaudited)**March
                      31**
                  
                  December
                      31**2006**
                  
                  2005**LIABILITIES
                      AND CAPITALIZATION**
                  (thousands)**Current
                      Liabilities**Notes payable to Great Plains Energy
                  **$**
                  **500**
                  
                  $
                  500Commercial paper
                  
                  **73,800**
                  
                  
                  31,900Current maturities of long-term debt
                  
                  **225,000**
                  
                  
                  -Accounts payable
                  
                  **93,009**
                  
                  
                  106,040Accrued taxes
                  
                  **39,204**
                  
                  
                  27,448Accrued interest
                  
                  **11,376**
                  
                  
                  11,549Accrued payroll and vacations
                  
                  **28,162**
                  
                  
                  27,520Accrued refueling outage costs
                  
                  **12,148**
                  
                  
                  8,974Derivative instruments
                  
                  **388**
                  
                  
                  -Other
                  
                  **8,196**
                  
                  
                  8,600Total
                  
                  **491,783**
                  
                  
                  222,531**Deferred
                      Credits and Other Liabilities**Deferred income taxes
                  
                  **626,163**
                  
                  
                  627,048Deferred investment tax credits
                  
                  **28,937**
                  
                  
                  29,698Asset retirement obligations
                  
                  **148,294**
                  
                  
                  145,907Pension liability
                  
                  **85,850**
                  
                  
                  85,301Regulatory liabilities
                  
                  **71,284**
                  
                  
                  69,641Derivative instruments
                  
                  **3,163**
                  
                  
                  2,601Other
                  
                  **39,865**
                  
                  
                  38,387Total
                  
                  **1,003,556**
                  
                  
                  998,583**Capitalization**Common shareholder's equityCommon stock-1,000 shares authorized without par value1 share issued, stated value
                  
                  **887,041**
                  
                  
                  887,041Retained earnings
                  
                  **275,833**
                  
                  
                  283,850Accumulated other comprehensive loss
                  
                  **(27,850**
                  **)**
                  
                  (29,909
                  )Total
                  
                  **1,135,024**
                  
                  
                  1,140,982Long-term debt (Note 8)
                  
                  **750,903**
                  
                  
                  976,424Total
                  
                  **1,885,927**
                  
                  
                  2,117,406**Commitments
                      and Contingencies (Note 13)**
                  
                  ****Total
                  **$**
                  **3,381,266**
                  
                  $
                  3,338,520The
                      disclosures regarding consolidated KCP&L included in the accompanying
                      Notes to Consolidated FinancialStatements
                      are an integral part of these statements.
  12
  **KANSAS
                    CITY POWER & LIGHT COMPANY****Consolidated
                    Statements of Income**(Unaudited)**Three
                    Months Ended March 31**
                **2006**
                
                2005**Operating
                    Revenues**
                (thousands)Electric revenues
                **$**
                **240,390**
                
                $
                233,215Other revenues
                
                **-**
                
                
                113Total
                
                **240,390**
                
                
                233,328**Operating
                    Expenses**Fuel
                
                **47,400**
                
                
                41,490Purchased power
                
                **5,117**
                
                
                11,490Skill set realignment costs (Note 9)
                
                **9,293**
                
                
                -Other
                
                **62,558**
                
                
                65,963Maintenance
                
                **22,578**
                
                
                29,346Depreciation and amortization
                
                **37,000**
                
                
                36,395General taxes
                
                **26,289**
                
                
                24,555(Gain) loss on property
                
                **97**
                
                
                (516
                )Total
                
                **210,332**
                
                
                208,723Operating
                    income
                
                **30,058**
                
                
                24,605Non-operating
                    income
                
                **1,713**
                
                
                1,497Non-operating
                    expenses
                
                **(1,057**
                **)**
                
                (1,153
                )Interest
                    charges
                
                **(14,858**
                **)**
                
                (14,619
                )Income
                    before income taxes and minority interestin subsidiaries
                
                **15,856**
                
                
                10,330Income
                    taxes
                
                **(3,873**
                **)**
                
                (965
                )Minority
                    interest in subsidiaries
                
                **-**
                
                
                888Net
                    income
                **$**
                **11,983**
                
                $
                10,253The
                    disclosures regarding consolidated KCP&L included in the accompanying
                    Notes toConsolidated
                    Financial Statements are an integral part of these
                    statements.
  13
  **KANSAS
                    CITY POWER & LIGHT COMPANY****Consolidated
                    Statements of Cash Flows**(Unaudited)**Three
                    Months Ended March 31**
                **2006**
                
                2005**Cash
                    Flows from Operating Activities**
                (thousands)Net
                    income
                **$**
                **11,983**
                
                $
                10,253Adjustments
                    to reconcile income to net cash from operating activities:Depreciation and amortization
                
                **37,000**
                
                
                36,395Amortization of:Nuclear fuel
                
                **3,890**
                
                
                3,277Other
                
                **1,650**
                
                
                1,956Deferred income taxes, net
                
                **(2,615**
                **)**
                
                (3,201
                )Investment tax credit amortization
                
                **(761**
                **)**
                
                (972
                )(Gain) loss on property
                
                **97**
                
                
                (516
                )Minority interest in subsidiaries
                
                **-**
                
                
                (888
                )Other
                    operating activities (Note 4)
                
                **3,040**
                
                
                (50,106
                )Net cash from operating activities
                
                **54,284**
                
                
                (3,802
                )**Cash
                    Flows from Investing Activities**Utility
                    capital expenditures
                
                **(73,899**
                **)**
                
                (32,295
                )Allowance
                    for borrowed funds used during construction
                
                **(898**
                **)**
                
                (435
                )Purchases
                    of nonutility property
                
                **(28**
                **)**
                
                (10
                )Proceeds
                    from sale of assets
                
                **109**
                
                
                63Purchases
                    of nuclear decommissioning trust investments
                
                **(15,586**
                **)**
                
                (7,912
                )Proceeds
                    from nuclear decommissioning trust investments
                
                **14,698**
                
                
                7,024Hawthorn
                    No. 5 partial insurance recovery
                
                **-**
                
                
                10,000Other
                    investing activities
                
                **(791**
                **)**
                
                (2,218
                )Net cash from investing activities
                
                **(76,395**
                **)**
                
                (25,783
                )**Cash
                    Flows from Financing Activities**Net
                    change in short-term borrowings
                
                **41,900**
                
                
                9,525Dividends
                    paid to Great Plains Energy
                
                **(20,000**
                **)**
                
                (30,800
                )Issuance
                    fees
                
                **(32**
                **)**
                
                (8
                )Net cash from financing activities
                
                **21,868**
                
                
                (21,283
                )**Net
                    Change in Cash and Cash Equivalents**
                
                **(243**
                **)**
                
                (50,868
                )**Cash
                    and Cash Equivalents at Beginning of Year**
                
                **2,961**
                
                
                51,619**Cash
                    and Cash Equivalents at End of Period**
                **$**
                **2,718**
                
                $
                751The
                    disclosures regarding consolidated KCP&L included in the accompanying
                    Notes to Consolidated FinancialStatements
                    are an integral part of these statements.
  14
  **KANSAS
                    CITY POWER & LIGHT COMPANY****Consolidated
                    Statements of Common Shareholder's Equity**(Unaudited)**Three
                    Months Ended March 31**
                **2006**
                
                2005**Shares**
                
                **Amount**
                
                Shares
                
                Amount(thousands,
                    except share amounts)**Common
                    Stock**
                
                **1**
                
                **$**
                **887,041**
                
                
                1
                
                $
                887,041**Retained
                    Earnings**Beginning
                    balance
                
                
                
                
                **283,850**
                
                
                
                
                
                252,893Net
                    income
                
                
                
                
                **11,983**
                
                
                
                
                
                10,253Dividends:Common stock held by Great Plains Energy
                
                
                
                **(20,000**
                **)**
                
                
                
                
                (30,800
                )Ending balance
                
                ****
                
                
                **275,833**
                
                
                
                
                
                232,346**Accumulated
                    Other Comprehensive Loss**Beginning
                    balance
                
                
                
                
                **(29,909**
                **)**
                
                
                
                
                (40,334
                )Derivative
                    hedging activity, net of tax
                
                
                
                
                **2,059**
                
                
                
                
                
                800Minimum
                    pension obligation, net of tax
                
                
                
                
                **-**
                
                
                
                
                
                (37
                )Ending balance
                
                
                
                
                **(27,850**
                **)**
                
                
                
                
                (39,571
                )**Total
                    Common Shareholder's Equity**
                
                ****
                
                **$**
                **1,135,024**
                
                
                ****
                
                $
                1,079,816The
                    disclosures regarding consolidated KCP&L included in the accompanying
                    Notes to Consolidated FinancialStatements
                    are an integral part of these statements.
  15
  **KANSAS
                    CITY POWER & LIGHT COMPANY****Consolidated
                    Statements of Comprehensive Income**(Unaudited)**Three
                    Months Ended March 31**
                **2006**
                
                2005(thousands)Net
                    income
                **$**
                **11,983**
                
                $
                10,253Other
                    comprehensive incomeGain on derivative hedging instruments
                
                **3,399**
                
                
                1,298Income taxes
                
                **(1,278**
                **)**
                
                (498
                )Net gain on derivative hedging instruments
                
                **2,121**
                
                
                800Reclassification to expenses, net of tax
                
                **(62**
                **)**
                
                -Derivative hedging activity, net of tax
                
                **2,059**
                
                
                800Change in minimum pension obligation
                
                **-**
                
                
                (60
                )Income taxes
                
                **-**
                
                
                23Net change in minimum pension obligation
                
                **-**
                
                
                (37
                )Comprehensive
                    income
                **$**
                **14,042**
                
                $
                11,016The
                    disclosures regarding consolidated KCP&L included in the accompanying
                    Notes to ConsolidatedFinancial
                    Statements are an integral part of these statements.




16


**GREAT
      PLAINS ENERGY INCORPORATED**


**KANSAS
        CITY POWER & LIGHT COMPANY**
 **Notes
        to Unaudited Consolidated Financial Statements**
  The
        notes
        to unaudited consolidated financial statements that follow are a combined
        presentation for Great Plains Energy Incorporated and Kansas City Power &
Light Company, both registrants under this filing. The terms “Great Plains
        Energy,” “Company,” “KCP&L” and “consolidated KCP&L” are used throughout
        this report. “Great Plains Energy” and the “Company” refer to Great Plains
        Energy Incorporated and its consolidated subsidiaries, unless otherwise
        indicated. “KCP&L” refers to Kansas City Power & Light Company, and
“consolidated KCP&L” refers to KCP&L and its consolidated
        subsidiaries.
  **1.**
            **SUMMARY
                OF SIGNIFICANT ACCOUNTING
                POLICIES**  **Organization**
 Great
        Plains Energy, a Missouri corporation incorporated in 2001, is a public utility
        holding company and does not own or operate any significant assets other
        than
        the stock of its subsidiaries. Great Plains Energy has four direct subsidiaries
        with operations or active subsidiaries:
  ·
            KCP&L
                is an integrated, regulated electric utility that provides electricity
                to
                customers primarily in the states of Missouri and Kansas. KCP&L has
                two wholly owned subsidiaries, Kansas City Power & Light Receivables
                Company (Receivables Company) and Home Service Solutions Inc. (HSS).
                HSS
                has no active operations.  ·
            KLT
                Inc. is an intermediate holding company that primarily holds, directly
                or
                indirectly, interests in Strategic Energy, L.L.C. (Strategic Energy),
                which provides competitive retail electricity supply services in
                several
                electricity markets offering retail choice, and affordable housing
                limited
                partnerships. KLT Inc. also wholly owns KLT Gas Inc. (KLT Gas).  ·
            Innovative
                Energy Consultants Inc. (IEC) is an intermediate holding company
                that
                holds an indirect interest in Strategic Energy. IEC does not own
                or
                operate any assets other than its indirect interest in Strategic
                Energy.
                When combined with KLT Inc.’s indirect interest in Strategic Energy, the
                Company indirectly owns 100% of Strategic
                Energy.  ·
            Great
                Plains Energy Services Incorporated (Services) provides services
                at cost
                to Great Plains Energy and its subsidiaries, including consolidated
                KCP&L.  The
        operations of Great Plains Energy and its subsidiaries are divided into two
        reportable segments, KCP&L and Strategic Energy. Great Plains Energy’s legal
        structure differs from the functional management and financial reporting
        of its
        reportable segments. Other activities not considered a reportable segment
        include the operations of HSS, Services, all KLT Inc. operations other than
        Strategic Energy, and holding company operations.
  **2.**
            **BASIC
                AND DILUTED EARNINGS (LOSS) PER COMMON SHARE
                CALCULATION**  There
        was
        no significant dilutive effect on Great Plains Energy’s EPS from other
        securities for the three months ended March 31, 2006 and 2005. To determine
        basic EPS, preferred stock dividend requirements are deducted from net income
        (loss) before dividing by the average number of common shares outstanding.
        The
        effect of dilutive securities, calculated using the treasury stock method,
        assumes the issuance of common shares applicable to stock options, performance
        shares, restricted stock and FELINE PRIDES SM .
  17
 The
        following table reconciles
        Great Plains Energy’s basic and diluted EPS.
 **Three
                      Months Ended March 31**
                  
                  **2006**
                  
                  **2005****Income**
                  (millions,
                      except per share amounts)Net
                      income (loss)
                  
                  $
                  (2.1
                  )
                  $
                  20.2Less:
                      preferred stock dividend requirements
                  
                  
                  0.4
                  
                  
                  0.4Earnings
                      (loss) available for common shareholders
                  
                  $
                  (2.5
                  )
                  $
                  19.8**Common
                      Shares Outstanding**Average
                      number of common shares outstanding
                  
                  
                  74.7
                  
                  
                  74.4Add:
                      effect of dilutive securities
                  
                  
                  -
                  
                  
                  0.2Diluted
                      average number of common shares outstanding
                  
                  
                  74.7
                  
                  
                  74.6**Basic
                      and diluted EPS**
                  
                  $
                  (0.03
                  )
                  $
                  0.27
 At
        March
        31, 2006 ,
        203,319
        performance shares, 166,792 restricted stock shares, 109,472 stock options
        and
        6.5 million FELINE PRIDES were excluded from the diluted earnings calculation
        because the Company had a net loss; therefore, no potential common shares
        are
        included in the calculation because the effect is anti-dilutive. At March
        31,
        2005, there were no anti-dilutive shares applicable to stock options,
        performance shares, restricted stock or FELINE PRIDES.
  In
        May
        2006, the Board of Directors declared
        a quarterly dividend of $0.415 per share on Great Plains Energy’s common stock.
        The common dividend is payable June 20, 2006, to shareholders of record as
        of May 30, 2006. The Board of Directors also declared regular dividends on
        Great
        Plains Energy’s preferred stock, payable September 1, 2006, to shareholders of
        record as of August 11, 2006.
  **3.**
            **CASH**  **Cash
        and Cash Equivalents**
 Cash
        equivalents consist of highly liquid investments with maturities of three
        months
        or less at acquisition. For Great Plains Energy, this includes Strategic
        Energy’s cash held in trust of $18.4 million and
        $21.9 million at
        March
        31, 2006 and December 31, 2005, respectively.
  Strategic
        Energy has entered into collateral arrangements with selected electricity
        power
        suppliers that require selected customers to remit payment to lockboxes that
        are
        held in trust and managed by a Trustee. As part of the trust administration,
        the
        Trustee remits payment to the supplier of electricity purchased by Strategic
        Energy. On a monthly basis, any remittances into the lockboxes in excess
        of
        disbursements to the supplier are remitted back to Strategic Energy.
  **Restricted
        Cash**
 Strategic
        Energy has entered into Master Power Purchase and Sale Agreements with its
        power
        suppliers. Certain of these agreements contain provisions whereby, to the
        extent
        Strategic Energy has a net exposure to the purchased power supplier, collateral
        requirements are to be maintained. Collateral posted in the form of cash
        to
        Strategic Energy is restricted by agreement, but would become unrestricted
        in
        the event of a default by the purchased power supplier. Strategic Energy
        had no
        restricted cash
        collateral at March 31, 2006, and $1.9 million at
        December 31, 2005.
  18
 **4.**
            **SUPPLEMENTAL
                CASH FLOW INFORMATION** ***Great
                      Plains Energy Other Operating Activities*****Three
                      Months Ended March 31**
                  
                  **2006**
                  
                  **2005**Cash
                      flows affected by changes in:
                  
                  (millions)Receivables
                  
                  $
                  18.3
                  
                  $
                  (35.8
                  )Fuel
                      inventories
                  
                  
                  (4.1
                  )
                  
                  (3.8
                  )Materials
                      and supplies
                  
                  
                  (0.5
                  )
                  
                  (1.3
                  )Accounts
                      payable
                  
                  
                  (29.3
                  )
                  
                  (1.6
                  )Accrued
                      taxes
                  
                  
                  4.8
                  
                  
                  (17.8
                  )Accrued
                      interest
                  
                  
                  (0.2
                  )
                  
                  1.4Accrued
                      refueling outage costs
                  
                  
                  3.2
                  
                  
                  1.7Pension
                      and postretirement benefit assets and obligations
                  
                  
                  4.7
                  
                  
                  9.2Allowance
                      for equity funds used during construction
                  
                  
                  (0.9
                  )
                  
                  (0.8
                  )Other
                  
                  
                  (0.1
                  )
                  
                  (11.6
                  )Total
                      other operating activities
                  
                  $
                  (4.1
                  )
                  $
                  (60.4
                  )Cash
                      paid during the period:Interest
                  
                  $
                  16.8
                  
                  $
                  16.8Income
                      taxes
                  
                  $
                  14.0
                  
                  $
                  14.8***Consolidated
                      KCP&L Other Operating Activities*****Three
                      Months Ended March 31**
                  
                  
                  **2006**
                  
                  
                  **2005**Cash
                      flows affected by changes in:
                  
                  (millions)Receivables
                  
                  $
                  5.9
                  
                  $
                  (54.7
                  )Fuel
                      inventories
                  
                  
                  (4.1
                  )
                  
                  (3.8
                  )Materials
                      and supplies
                  
                  
                  (0.5
                  )
                  
                  (1.3
                  )Accounts
                      payable
                  
                  
                  (16.8
                  )
                  
                  0.9Accrued
                      taxes
                  
                  
                  11.8
                  
                  
                  (1.6
                  )Accrued
                      interest
                  
                  
                  (0.2
                  )
                  
                  1.2Accrued
                      refueling outage costs
                  
                  
                  3.2
                  
                  
                  1.7Pension
                      and postretirement benefit assets and obligations
                  
                  
                  4.3
                  
                  
                  7.6Allowance
                      for equity funds used during construction
                  
                  
                  (0.9
                  )
                  
                  (0.8
                  )Other
                  
                  
                  0.3
                  
                  
                  0.7Total
                      other operating activities
                  
                  $
                  3.0
                  
                  $
                  (50.1
                  )Cash
                      paid during the period:Interest
                  
                  $
                  14.5
                  
                  $
                  12.8Income
                      taxes
                  
                  $
                  11.4
                  
                  $
                  20.2
 **Discontinued
        Operations**
 In
        the
        fourth quarter of 2005, the Company changed the presentation of its consolidated
        statements of cash flows to include the cash flows from operating, investing
        and
        financing activities of discontinued operations within the respective categories
        of operating, investing and financing activities and retroactively revised
        the
        consolidated statement of cash flow for the three months ended March 31,
        2005,
        as applicable. Net cash flows from operating activities as previously reported
        were $7.4 million and net cash flows from operating activities as currently
        reported are $6.8 million, resulting in a $0.6 million change in cash
        flows.
 19
 **5.**
            **RECEIVABLES**  The
        Company’s receivables are detailed in the following table .
 **March
                      31**
                  
                  **December
                      31****2006**
                  
                  **2005****Consolidated
                      KCP&L**
                  
                  (millions)Customer
                      accounts receivable(a)
                  
                  $
                  19.4
                  
                  $
                  34.0Allowance
                      for doubtful accounts
                  
                  
                  (1.1
                  )
                  
                  (1.0
                  )Other
                      receivables
                  
                  
                  46.8
                  
                  
                  37.3Consolidated
                      KCP&L receivables
                  
                  
                  65.1
                  
                  
                  70.3**Other
                      Great Plains Energy**Other
                      receivables
                  
                  
                  181.4
                  
                  
                  193.0Allowance
                      for doubtful accounts
                  
                  
                  (4.7
                  )
                  
                  (4.3
                  )Great
                      Plains Energy receivables
                  
                  $
                  241.8
                  
                  $
                  259.0(a)Customer accounts receivable included unbilled receivables
                      of $26.2
                      millionand $31.4 million at March 31, 2006 and December 31, 2005,
                      respectively.
 Consolidated
        KCP&L’s other receivables at March 31, 2006 and December 31, 2005,
        consisted primarily of receivables from partners in jointly owned electric
        utility plants and wholesale sales receivables. Great Plains Energy’s other
        receivables at March 31, 2006 and December 31, 2005, consisted primarily of
        accounts receivable held by Strategic Energy, including unbilled receivables
        of
        $88.0 million and
        $99.9 million ,
        respectively.
  Under
        an
        agreement, KCP&L sells all of its retail electric accounts receivable to its
        wholly owned subsidiary, Receivables Company, which in turn sells an undivided
        percentage ownership interest in the accounts receivable to Victory Receivables
        Corporation, an independent outside investor. KCP&L sells its receivables at
        a fixed price based upon the expected cost of funds and charge-offs. These
        costs
        comprise KCP&L’s loss on the sale of accounts receivable. KCP&L services
        the receivables and receives an annual servicing fee of 2.5% of the outstanding
        principal amount of the receivables sold to Receivables Company. KCP&L does
        not recognize a servicing asset or liability since management determined
        the
        collection agent fee earned by KCP&L approximates market value. Information
        regarding KCP&L’s sale of accounts receivable to Receivables Company under
        this agreement is reflected in the following table.
 **Three
                      Months Ended**
                  
                  
                  **Receivables**
                  **Consolidated****March
                      31, 2006**
                  
                  **KCP&L**
                  
                  **Company**
                  
                  **KCP&L**(millions)Receivables
                      (sold) purchased
                  $
                  (197.2
                  )
                  $
                  197.2
                  
                  $
                  -Gain
                      (loss) on sale of accounts receivable(a)
                  
                  (2.0
                  )
                  
                  2.1
                  
                  
                  0.1Servicing
                      fees
                  
                  0.6
                  
                  
                  (0.6
                  )
                  
                  -Fees
                      to outside investor
                  
                  -
                  
                  
                  (0.8
                  )
                  
                  (0.8
                  )**Cash
                      flows during the period**Cash
                      from customers transferred toReceivables
                      Company
                  
                  (212.5
                  )
                  
                  212.5
                  
                  
                  -Cash
                      paid to KCP&L for receivables purchased
                  
                  210.4
                  
                  
                  (210.4
                  )
                  
                  -Servicing
                      fees
                  
                  0.6
                  
                  
                  (0.6
                  )
                  
                  -Interest
                      on intercompany note
                  
                  0.3
                  
                  
                  (0.3
                  )
                  
                  -(a)The
                      net gain is the result of the timing difference inherent in
                      collecting
                      receivables and overthe
                      life of the agreement will net to zero.
 20
 **6.**
            **NUCLEAR
                PLANT**  KCP&L
        owns 47% of Wolf Creek Nuclear Operating Corporation (WCNOC), the operating
        company for Wolf Creek Generating Station (Wolf Creek), its only nuclear
        generating unit. Wolf Creek is regulated by the Nuclear Regulatory Commission
        (NRC), with respect to licensing, operations and safety-related requirements.
  **Nuclear
        Liability and Insurance**
 The
        owners of Wolf Creek (Owners) maintain nuclear insurance for Wolf Creek in
        four
        areas: liability, worker radiation, property and accidental outage. These
        policies contain certain industry standard exclusions, including, but not
        limited to, ordinary wear and tear, and war. Both the nuclear liability and
        property insurance programs subscribed to by members of the nuclear power
        generating industry include industry aggregate limits for non-certified acts
        of
        terrorism and related losses, as defined by the Terrorism Risk Insurance
        Act,
        including replacement power costs. An industry aggregate limit of $0.3 billion
        exists for liability claims, regardless of the number of non-certified acts
        affecting Wolf Creek or any other nuclear energy liability policy or the
        number
        of policies in place. An industry aggregate limit of $3.2 billion plus any
        reinsurance recoverable by Nuclear Electric Insurance Limited (NEIL), the
        Owners’ insurance provider, exists for property claims, including accidental
        outage power costs for acts of terrorism affecting Wolf Creek or any other
        nuclear energy facility property policy within twelve months from the date
        of
        the first act. These limits are the maximum amount to be paid to members
        who
        sustain losses or damages from these types of terrorist acts. For certified
        acts
        of terrorism, the individual policy limits apply. In addition, industry-wide
        retrospective assessment programs (discussed below) can apply once these
        insurance programs have been exhausted.
  ***Liability
        Insurance***
 Pursuant
        to the Price-Anderson Act, which was reauthorized through December 31, 2025,
        by
        the Energy Policy Act of 2005, the Owners are required to insure against
        public
        liability claims resulting from nuclear incidents to the full limit of public
        liability, which is currently $10.8 billion. This limit of liability consists
        of
        the maximum available commercial insurance of $0.3 billion, and the remaining
        $10.5 billion is provided through an industry-wide retrospective assessment
        program mandated by law, known as the Secondary Financial Protection (SFP)
        program. Under the SFP program, the Owners can be assessed up to $100.6 million
        ($47.3 million, KCP&L’s 47% share) per incident at any commercial reactor in
        the country, payable at no more than $15 million ($7.1 million, KCP&L’s 47%
        share) per incident per year effective with the Energy Policy Act of 2005.
        This
        assessment is subject to an inflation adjustment based on the Consumer Price
        Index and applicable premium taxes. This assessment is in addition to worker
        radiation claims insurance. In addition, the U.S. Congress could impose
        additional revenue-raising measures to pay claims.
  ***Property,
        Decontamination, Premature Decommissioning and Extra Expense Insurance***
 The
        Owners carry decontamination liability, premature decommissioning liability
        and
        property damage insurance for Wolf Creek totaling approximately $2.8 billion
        ($1.3 billion, KCP&L's 47% share). NEIL provides this insurance.
  In
        the
        event of an accident, insurance proceeds must first be used for reactor
        stabilization and site decontamination in accordance with a plan mandated
        by the
        NRC. KCP&L’s share of any remaining proceeds can be used for further
        decontamination, property damage restoration and premature decommissioning
        costs. Premature decommissioning coverage applies only if an accident at
        Wolf
        Creek exceeds $500 million in property damage and decontamination expenses,
        and
        only after trust funds have been exhausted.
 21
 ***Accidental
        Nuclear Outage Insurance***
 The
        Owners also carry additional insurance from NEIL to cover costs of replacement
        power and other extra expenses incurred in the event of a prolonged outage
        resulting from accidental property damage at Wolf Creek.
  Under
        all
        NEIL policies, the Owners are subject to retrospective assessments if NEIL
        losses, for each policy year, exceed the accumulated funds available to the
        insurer under that policy. The estimated maximum amount of retrospective
        assessments under the current policies could total approximately
        $26.5 million ($12.4 million, KCP&L’s 47% share) per policy
        year.
  In
        the
        event of a catastrophic loss at Wolf Creek, the insurance coverage may not
        be
        adequate to cover property damage and extra expenses incurred. Uninsured
        losses,
        to the extent not recovered through rates, would be assumed by KCP&L and the
        other owners and could have a material adverse effect on KCP&L’s results of
        operations, financial position and cash flows.
  ***Low-Level
        Waste***
 The
        Low-Level Radioactive Waste Policy Amendments Act of 1985 mandated that the
        various states, individually or through interstate compacts, develop alternative
        low-level radioactive waste disposal facilities. The states of Kansas, Nebraska,
        Arkansas, Louisiana and Oklahoma formed the Central Interstate Low-Level
        Radioactive Waste Compact (Compact) and selected a site in northern Nebraska
        to
        locate a disposal facility. WCNOC and the owners of the other five nuclear
        units
        in the Compact provided most of the pre-construction financing for this project.
  On
        December 18, 1998, the application for a license to construct this project
        was
        denied. After the license denial, WCNOC, the Compact Commission (Commission)
        and
        others filed a lawsuit in federal court contending Nebraska officials acted
        in
        bad faith while handling the license application. In September 2002, the
        U.S.
        District Court Judge presiding over the lawsuit issued his decision in the
        case
        finding that the State of Nebraska acted in bad faith in processing the license
        application for a low-level radioactive waste disposal site in Nebraska and
        rendered a judgment on behalf of the Commission in the amount of $151.4 million
        against the state. After the U.S. Court of Appeals affirmed the decision,
        Nebraska and the Commission settled the case by Nebraska agreeing to pay
        the
        Commission a one-time amount of $145.8 million. At the request of the
        Commission, WCNOC along with other members of the Compact, filed with the
        Commission their claims for refund. In 2005, WCNOC received a return of its
        investment of $19.6 million ($9.2 million, KCP&L’s 47% share), including
        pre-judgment interest and attorney’s fees. The Commission continues to explore
        alternative long-term waste disposal capability and has retained a portion
        of
        the settlement, above the amounts returned, until it determines what role
        it
        will take in the development of alternative disposal capability. In April
        2006,
        WCNOC received an additional $1.7 million ($0.8 million, KCP&L’s 47% share).
        The remaining insignificant amount will be retained by the Commission for
        future
        operations. In April 2006, WCNOC and other affected generators filed a lawsuit
        in Federal District Court in Nebraska. The lawsuit is intended to preserve
        their
        ability to continue to pursue their claim for their share of the remaining
        amount plus interest.
  **7.**
            **REGULATORY
                MATTERS**  **KCP&L’s
        Comprehensive Energy Plan**
 KCP&L
        continues to make progress in implementing its comprehensive energy plan
        and
        orders received from the Public Service Commission of the State of Missouri
        (MPSC) and The State Corporation Commission of the State of Kansas (KCC)
        in
        2005. The Sierra Club and Concerned Citizens of Platte County have appealed
        the
        MPSC order, and the Sierra Club has appealed the KCC order. In March 2006,
        the
        Circuit Court of Cole County, Missouri, affirmed the MPSC Order and the Sierra
        Club has appealed the decision to the Missouri Court of Appeals. The Kansas
        District Court denied the Sierra Club’s appeal in May 2006. The Sierra Club may
        appeal to the Kansas Court of
 22
 Appeals.
        Although subject to the appeals, the MPSC and KCC orders remain in effect
        pending the applicable court’s decision.
  In
        February 2006 ,
        KCP&L filed requests with the MPSC and KCC for annual rate increases of
        $55.8 million or 11.5% and $42.3 million or 10.5%, respectively. The
        requested rate increases reflect recovery of increasing operating costs
        including fuel, transportation and pensions as well as investments in wind
        generation and customer programs and compensation for wholesale sales volatility
        and construction risks. The request is based on a return on equity of 11.5%
        and
        an adjusted equity ratio of 53.8%. Discovery is underway and management
        anticipates that approved rate adjustments for both jurisdictions will go
        into
        effect January 1, 2007. Formal evidentiary hearings before the MPSC and KCC
        are
        scheduled for October 2006.
  KCP&L
        has initiated construction of its 100.5 MW wind
        project located in Spearville, Kansas. Management expects the project to
        be
        completed and on-line in time for inclusion in the current rate cases. A
        request
        to the Southwest Power Pool, Inc. (SPP) has been made for firm transmission
        capacity. Management expects a response to its request in the second quarter
        of
        2006. The environmental upgrades at LaCygne No. 1 began with the spring outage
        in the first quarter of 2006 and will be completed during the spring 2007
        outage. An owner’s engineer has been hired and the engineering design for Iatan
        Station is in progress. The Iatan No. 2 boiler and steam turbine and the
        Iatan
        Nos. 1 and 2 air emission control equipment procurement is in progress and
        plant construction is expected to start in 2006. Although contracting is
        not
        complete, developing market conditions indicate a potential increase in the
        overall cost estimates of the comprehensive energy plan in the range of 10%
        to
        20%. The primary drivers are increases in materials and labor costs and some
        scope additions. Management anticipates completion of its definitive estimates
        by August. The definitive estimates could be materially different than the
        current estimates; however, management is confident that project costs will
        be
        competitive with other similar projects.
  In
        the
        first quarter of 2006, KCP&L received its air permit and a water quality
        certification from the Missouri Department of Natural Resources. The Sierra
        Club
        is appealing the air permit. KCP&L anticipates issuances of a wetlands
        permit, a permit for the construction of a temporary barge slip and an
        Environmental Assessment with a finding of No Significant Impact toward mid-year
        2006.
 23
 **Regulatory
        Assets and Liabilities**
 KCP&L
        is subject to the provisions of Statement of Financial Accounting Standards
        (SFAS) No. 71, “Accounting for the Effects of Certain Types of Regulation” and
        has recorded assets and liabilities on its balance sheet resulting from the
        effects of the ratemaking process, which would not be recorded under GAAP
        for
        non-regulated entities.
 **Amortization**
                  **March
                      31**
                  **December
                      31****ending
                      period**
                  
                  **2006**
                  
                  **2005****Regulatory
                      Assets**
                  
                  
                  
                  (millions)Taxes
                      recoverable through future rates
                  
                  
                  
                  
                  $
                  84.9
                  
                  $
                  85.7Decommission
                      and decontaminate federal uraniumenrichment
                      facilities
                  2007
                  
                  
                  1.2
                  
                  
                  1.3Loss
                      on reacquired debt
                  2037
                  
                  
                  6.9
                  
                  
                  7.1January
                      2002 incremental ice storm costs (Missouri)
                  2007
                  
                  
                  3.8
                  
                  
                  4.9Change
                      in depreciable life of Wolf Creek
                  2045
                  
                  
                  31.9
                  
                  
                  27.4Cost
                      of removal
                  
                  
                  
                  
                  
                  8.8
                  
                  
                  9.3Asset
                      retirement obligations
                  
                  
                  
                  
                  
                  22.9
                  
                  
                  23.6Future
                      recovery of pension costs
                  (a)
                  
                  
                  21.4
                  
                  
                  15.6Pension
                      accounting method difference
                  (a)
                  
                  
                  0.8
                  
                  
                  -Other
                  Various
                  
                  
                  5.8
                  
                  
                  5.0Total
                      Regulatory Assets
                  $
                  188.4
                  
                  $
                  179.9**Regulatory
                      Liabilities**Emission
                      allowances
                  (a)
                  
                  $
                  64.4
                  
                  $
                  64.3Pension
                      accounting method difference
                  (a)
                  
                  
                  -
                  
                  
                  1.0Additional
                      Wolf Creek amortization (Missouri)
                  (a)
                  
                  
                  6.9
                  
                  
                  4.3Total
                      Regulatory Liabilities
                  $
                  71.3
                  
                  $
                  69.6(a)Will be amortized in accordance with future rate cases.
 Except
        as
        noted below, regulatory assets for which costs have been incurred have been
        included (or are expected to be included, for costs incurred subsequent to
        the
        most recently approved rate case) in KCP&L’s rate base, thereby providing a
        return on invested costs when included in rate base. Certain regulatory assets
        do not result from cash expenditures and therefore do not represent investments
        included in rate base or have offsetting liabilities that reduce rate base.
        The
        pension accounting method difference (which may be either a regulatory asset
        or
        liability) and certain insignificant items in Regulatory Assets - Other are
        not
        included in rate base.
  **Southwest
        Power Pool** **Regional
        Transmission Organization**
 KCP&L
        is a member of the SPP, which is a Federal Energy Regulatory Commission (FERC)
        approved Regional Transmission Organization (RTO). In February 2006, KCP&L
        reached an agreement with the MPSC staff and interveners regarding interim
        approval to turn over functional control of KCP&L’s transmission facilities
        to SPP and participate in the energy imbalance service market. The MPSC has
        scheduled an on-the-record presentation concerning this agreement for May
        12,
        2006. It is anticipated that the MPSC will issue an order concerning KCP&L’s
        participation soon thereafter. KCC has held workshops seeking additional
        information on KCP&L’s request to turn over functional control of its
        transmission facilities and participate in the energy imbalance service market.
        KCC has scheduled hearings concerning KCP&L’s application July 17, 2006,
        with an order to be issued in late summer 2006. In January 2006, SPP made
        a
        revised filing to FERC addressing FERC’s issues cited in its order rejecting
        SPP’s original filing for an energy imbalance service market. In March 2006,
        FERC issued an order on the revised filing rejecting in part, conditionally
        accepting in part and suspending the start of the SPP energy imbalance service
        market to no earlier than October 1, 2006, and required SPP to make additional
        filings. FERC provided guidance on several issues considered critical to
        the
 24
 successful
        implementation of the energy imbalance service market. KCP&L will continue
        preparation for this new start-up date.
  **Seams
        Elimination Charge Adjustment**
 Seams
        Elimination Charge Adjustment (SECA) is a transitional pricing mechanism
        authorized by FERC and intended to compensate transmission owners for the
        revenue lost as a result of FERC’s elimination of regional through and out rates
        between PJM Interconnection (PJM) and the Midwest Independent Transmission
        System Operator, Inc. (MISO) during a 16-month transition period from
        December 1, 2004 through March 31, 2006. Each relevant PJM and MISO zone
        and the load-serving entities within that zone are allocated a portion of
        the
        SECA based on transmission services provided to that zone during 2002 and
        2003.
        Strategic Energy recorded purchased power expenses for these charges totaling
        $2.7 million for the
        three months ended March 31, 2006, which is the end of the transition period.
        Strategic Energy billed $0.4 million for the
        three months ended March 31, 2006, of its SECA costs to its retail customers.
  There
        are
        several unresolved matters and legal challenges to the SECA that are pending
        before FERC on rehearing. FERC established a schedule for resolution of certain
        SECA issues, including the issue of shifting SECA allocations to the shipper.
        The shipper in Strategic Energy’s situation is the wholesale supplier, which,
        through a contract with Strategic Energy, delivered power to various zones
        in
        which Strategic Energy was supplying retail customers. In most instances,
        the
        shipper was the purchaser of through and out transmission service and therefore
        included the cost of the through and out rate in its energy price. Management
        is
        unable to predict the outcome of legal and regulatory challenges to the SECA
        mechanism.
 25
 **8.**
            **CAPITALIZATION**  Great
        Plains Energy and consolidated KCP&L’s long-term debt is detailed in the
        following table .
 **March
                      31**
                  
                  **December
                      31****Year
                      Due**
                  
                  **2006**
                  
                  **2005****Consolidated
                      KCP&L**
                  
                  
                  
                  (millions)General
                      Mortgage Bonds7.95%
                      Medium-Term Notes
                  
                  
                  2007
                  
                  $
                  0.5
                  
                  $
                  0.53.48%*
                      EIRR bonds
                  
                  
                  2012-2035
                  
                  
                  158.8
                  
                  
                  158.8Senior
                      Notes6.00%
                  
                  
                  2007
                  
                  
                  225.0
                  
                  
                  225.06.50%
                  
                  
                  2011
                  
                  
                  150.0
                  
                  
                  150.06.05%
                  
                  
                  2035
                  
                  
                  250.0
                  
                  
                  250.0Unamortized
                      discount
                  
                  
                  
                  
                  
                  (1.7
                  )
                  
                  (1.8
                  )EIRR
                      bonds4.75%
                      Series A & B
                  
                  
                  2015
                  
                  
                  104.2
                  
                  
                  104.64.75%
                      Series D
                  
                  
                  2017
                  
                  
                  39.1
                  
                  
                  39.34.65%
                      Series 2005
                  
                  
                  2035
                  
                  
                  50.0
                  
                  
                  50.0Current
                      maturities
                  
                  
                  
                  
                  
                  (225.0
                  )
                  
                  -Total
                      consolidated KCP&L excluding current maturities
                  
                  
                  
                  
                  
                  750.9
                  
                  
                  976.4**Other
                      Great Plains Energy**7.70%*
                      Affordable Housing Notes
                  
                  
                  2006-2008
                  
                  
                  2.6
                  
                  
                  2.64.25%
                      FELINE PRIDES Senior Notes
                  
                  
                  2009
                  
                  
                  163.6
                  
                  
                  163.6Current
                      maturities**
                  
                  
                  (165.3
                  )
                  
                  (1.7
                  )Total
                      consolidated Great Plains Energy excluding current
                      maturities
                  $
                  751.8
                  
                  $
                  1,140.9* 
                      Weighted-average interest rates at March 31, 2006.**
                      Includes $163.6 million of FELINE PRIDES Senior Notes scheduled
                      to mature
                      in 2009, but must be remarketedbetween August 16, 2006 and February 16, 2007.
 **Effective
        Interest Rates on KCP&L’s Unsecured Notes at March 31,
        2006**
 Interest
        rate swaps on KCP&L’s Series A, B and D EIRR bonds resulted in an effective
        interest rate of 5.85%. As a result of amortizing the gain recognized in
        other
        comprehensive income (OCI) on KCP&L’s 2005 Treasury Locks (T-Locks), the
        effective interest rate on KCP&L’s 6.05% Senior Notes is 5.78%.
  **Amortization
        of Debt Expense**
 Great
        Plains Energy’s and consolidated KCP&L’s amortization of debt expense is
        detailed in the following table.
 **Three
                        Months Ended March 31**
                    
                    **2006**
                    
                    **2005**(millions)Consolidated
                        KCP&L
                    
                    $
                    0.5
                    
                    $
                    0.6Other
                        Great Plains Energy
                    
                    
                    0.2
                    
                    
                    0.1Total
                        Great Plains Energy
                    
                    $
                    0.7
                    
                    $
                    0.7
  **Forward
            Starting Swaps**
 During
        the first quarter of 2006, KCP&L entered into two Forward Starting Swaps
        with a combined notional principal amount of $225.0 million to
        hedge
        interest rate volatility on the anticipated refinancing of KCP&L’s $225.0
        million senior notes that mature in March 2007. See Note 16 for additional
        information.
 26
 **Short-Term
        Borrowings And Short-Term Bank Lines of Credit**
 Great
        Plains Energy has a $550 million revolving credit facility with a group of
        banks
        that expires in December 2009. A default by Great Plains Energy or any of
        its
        significant subsidiaries of other indebtedness totaling more than $25.0 million
        is a default under the facility. Under the terms of this agreement, Great
        Plains
        Energy is required to maintain a consolidated indebtedness to consolidated
        capitalization ratio, as defined in the agreement, not greater than 0.65
        to 1.00
        at all times. At March 31, 2006, the Company was in compliance with this
        covenant. At March 31, 2006, Great Plains Energy had no cash borrowings and
        had
        issued letters of credit totaling $47.0 million under
        the
        credit facility as credit support for Strategic Energy. At December 31,
        2005 ,
        Great
        Plains Energy had $6.0 million of outstanding borrowings with an interest
        rate
        of 4.98% and had issued letters of credit totaling $38.5 million under the
        credit facility as credit support for Strategic Energy.
  KCP&L
        has a $250 million revolving credit facility with a group of banks that expires
        in December 2009, to provide support for its issuance of commercial paper
        and
        other general purposes. A default by KCP&L on other indebtedness totaling
        more than $25.0 million is a default under the facility. Under the terms
        of the
        agreement, KCP&L is required to maintain a consolidated indebtedness to
        consolidated capitalization ratio, as defined in the agreement, not greater
        than
        0.65 to 1.00 at all times. At March 31, 2006, KCP&L was in compliance
        with this covenant. At March 31, 2006, KCP&L had $73.8 million of
        commercial paper outstanding, at a weighted-average interest rate of 4.95% and
        no
        cash borrowings under the facility. At December 31, 2005, KCP&L
        had $31.9 million of commercial paper outstanding, at a weighted-average
        interest rate of 4.35% and no cash borrowings under the facility.
  Strategic
        Energy has a $135 million revolving credit facility with a group of banks
        that
        expires in June 2009. So long as there is no default or unmatured default,
        Strategic Energy may increase this amount by up to $15 million by increasing
        the
        commitment of one or more lenders that have agreed to such increase, or by
        adding one or more lenders with the consent of the administrative agent.
        Great
        Plains Energy has currently guaranteed $25.0 million of this facility. A
        default
        by Strategic Energy of other indebtedness, as defined in the facility, totaling
        more than $7.5 million is a default under the facility. Under the terms of
        this
        amended agreement, Strategic Energy is required to maintain a minimum net
        worth
        of $75.0 million, a minimum fixed charge coverage ratio of at least 1.05
        to 1.00
        and a minimum debt service coverage ratio of at least 4.00 to 1.00, as those
        terms are defined in the agreement. In addition, under the terms of this
        amended
        agreement, Strategic Energy is required to maintain a maximum funded
        indebtedness to EBITDA ratio, as defined in the agreement, of 3.00 to 1.00,
        on a
        quarterly basis through June 30, 2007, and 2.75 to 1.00 thereafter. In the
        event of a breach of one or more of these four covenants, so long as no other
        default has occurred, Great Plains Energy may cure the breach through a cash
        infusion, a guarantee increase or a combination of the two. At March 31,
        2006, Strategic Energy was in compliance with these covenants. At March 31,
        2006, $62.1 million in
        letters of credit had been issued and there were no cash borrowings under
        the
        agreement. At December 31, 2005 ,
        $75.2
        million in letters of credit had been issued and there were no cash borrowings
        under the agreement.
  **Common
        Shareholders’ Equity**
 At
        March
        31, 2006, Great Plains Energy had 3.0 million shares of common stock registered
        with the Securities and Exchange Commission (SEC) for a Dividend Reinvestment
        and Direct Stock Purchase Plan (Plan). The Plan allows for the purchase of
        common shares by reinvesting dividends or making optional cash payments.
        Great
        Plains Energy can issue new shares or purchase shares on the open market
        for the
        Plan. During the first quarter of 2006, Great Plains Energy filed a registration
        statement with the SEC to register an additional 1.0 million shares.
  During
        the first quarter of 2006, Great Plains Energy registered an additional 1.0
        million shares of common stock with the SEC for its defined contribution
        savings
        plan bringing the total number of shares registered to 10.3
        million.
 27
 **9.**
            **PENSION****PLANS AND OTHER EMPLOYEE BENEFITS**  The
        Company maintains defined benefit pension plans for substantially all employees,
        including officers, of KCP&L, Services and WCNOC. Pension benefits under
        these plans reflect the employees’ compensation, years of service and age at
        retirement.
  The
        MPSC
        and KCC issued orders in 2005 establishing KCP&L’s annual pension costs at
        $22 million for the years 2005 and 2006 through the creation of regulatory
        assets and liabilities for future recovery from or refund to customers, as
        appropriate. As a result, KCP&L’s 2006 pension costs were reduced and the
        corresponding regulatory assets were increased by $7.6 million.
  In
        addition to providing pension benefits, the Company provides certain
        postretirement health care and life insurance benefits for substantially
        all
        retired employees of KCP&L, Services and WCNOC. The cost of postretirement
        benefits charged to KCP&L are accrued during an employee's years of service
        and recovered through rates.
  The
        following table provides the components of net periodic benefit costs prior
        to
        the effects of capitalization and sharing with joint-owners of power
        plants.
 **Pension
                      Benefits**
                  
                  **Other
                      Benefits****Three
                      Months Ended March 31**
                  
                  **2006**
                  
                  **2005**
                  
                  **2006**
                  
                  **2005****Components
                      of net periodic benefit cost**
                  
                  (millions)Service
                      cost
                  
                  $
                  4.7
                  
                  $
                  4.3
                  
                  $
                  0.2
                  
                  $
                  0.3Interest
                      cost
                  
                  
                  7.7
                  
                  
                  7.4
                  
                  
                  0.7
                  
                  
                  0.7Expected
                      return on plan assets
                  
                  
                  (8.2
                  )
                  
                  (8.1
                  )
                  
                  (0.1
                  )
                  
                  (0.2
                  )Amortization
                      of prior service cost
                  
                  
                  1.1
                  
                  
                  1.1
                  
                  
                  0.1
                  
                  
                  0.1Recognized
                      net actuarial loss (gain)
                  
                  
                  8.0
                  
                  
                  4.7
                  
                  
                  0.2
                  
                  
                  0.1Transition
                      obligation
                  
                  
                  -
                  
                  
                  -
                  
                  
                  0.3
                  
                  
                  0.3Net
                      periodic benefit cost beforeregulatory
                      adjustment
                  
                  
                  13.3
                  
                  
                  9.4
                  
                  
                  1.4
                  
                  
                  1.3Regulatory
                      adjustment
                  
                  
                  (7.6
                  )
                  
                  -
                  
                  
                  -
                  
                  
                  -Net
                      periodic benefit cost
                  
                  $
                  5.7
                  
                  $
                  9.4
                  
                  $
                  1.4
                  
                  $
                  1.3
 **Consolidated
        KCP&L Skill Set Realignment Costs**
 Over
        the
        past several months, management undertook a process to assess, improve and
        reposition the skill sets of KCP&L’s employees for implementation of the
        comprehensive energy plan. For the three months ended March 31, 2006, KCP&L
        recorded $9.3 million related to this workforce realignment process reflecting
        severance, benefits and related payroll taxes provided by KCP&L to
        employees. Management anticipates the need to fill positions with the specific
        skill sets and talent needed to achieve KCP&L’s goals. Management believes
        that the realignment allows for optimization of employee levels and avoids
        future additional expense. Additionally,
        estimated pension settlement costs of approximately $7.8 million associated with the realignment will be recorded in the second quarter of
        2006.
        The pension settlement costs are a result of the number of employees retiring
        and selecting the lump-sum payment option. The final pension settlement costs
        will be determined after the end of the plan year in the fourth quarter of
        2006.
  **10.**
            **EQUITY
                COMPENSATION**  As
        of
        January 1, 2006, the Company adopted SFAS No. 123 (revised 2004), “Share-Based
        Payment” using the modified prospective application method. The adoption of SFAS
        No. 123R had an insignificant effect on the Company’s income statement and cash
        flows for the three months ended March 31, 2006.
 28
 The
        Company’s Long-Term Incentive Plan is an equity compensation plan approved by
        its shareholders. The Long-Term Incentive Plan permits the grant of restricted
        stock, stock options, limited stock appreciation rights and performance shares
        to officers and other employees of the Company and its subsidiaries. The
        maximum
        number of shares of Great Plains Energy common stock that can be issued under
        the plan is 3.0 million. Common stock shares delivered by the Company under
        the
        Long-Term Incentive Plan may be authorized but unissued common stock, common
        stock held in the treasury or purchased on the open market (including private
        purchases) in accordance with applicable security laws. The Company has
        a
        policy of delivering newly issued shares, or shares surrendered by Plan
        participants on account of withholding taxes and held in treasury, or both,
        to
        satisfy share option exercises and does not expect to repurchase common shares
        during 2006 to satisfy stock option exercises for the period.
  SFAS
        No.
        123R requires forfeitures to be estimated for the year and the expense is
        no
        longer reversed when the forfeiture occurs. Forfeiture rates are based on
        historical and future expectations and will be reevaluated annually. The
        Company
        recognized compensation expense of $0.8 million and $0.6 million for the
        three
        months ended March 31, 2006 and 2005, respectively. The total income tax
        benefit
        recognized in the income statement for share-based compensation arrangements
        was
        $0.1 million and $0.2 million for the three months ended March 31, 2006 and
        2005, respectively.
  **Stock
        Options Granted 2001 - 2003**
 Stock
        options were granted under the plan at market value of the shares on the
        grant
        date. The options vest three years after the grant date and expire in ten
        years
        if not exercised. The fair value for the stock options granted in 2001 -
        2003
        was estimated at the date of grant using the Black-Scholes option-pricing
        model.
        Compensation expense and accrued dividends related to stock options are
        recognized over the stated vesting period. Exercise prices range from $24.90
        to
        $27.73. The stock options are expected to be fully vested by the end of the
        third quarter of 2006 and management does not anticipate any additional
        forfeiture expense for 2006.
  All
        stock
        option activity for the three months ended March 31, 2006, is summarized
        in the
        following table.
 **Remaining****Exercise**
                  
                  **Contractual****Stock
                      Options**
                  
                  **Shares**
                  
                  **Price***
                  
                  **Term***Beginning
                      balance
                  
                  111,455
                  
                  $
                  25.56Forfeited
                      or expired
                  
                  (1,983
                  )
                  
                  
                  27.73Ending
                      balance
                  
                  
                  
                  
                  
                  109,472
                  
                  
                  25.52
                  
                  
                  5.7Exercisable
                      at March 31
                  
                  95,000
                  
                  
                  25.19
                  
                  
                  5.5*weighted-average
 A
        summary
        of the status of the Company’s nonvested stock options as of March 31, 2006, and
        changes during the three months ended, is presented in the following table.
 **Nonvested**
                  
                  
                  
                  **Fair****Stock
                      Options**
                  
                  **Shares**
                  
                  **Value
                      ***Beginning
                      balance
                  
                  16,455
                  
                  $
                  3.15Forfeited
                  
                  (1,983
                  )
                  
                  3.15Ending
                      balance
                  
                  
                  
                  
                  
                  14,472
                  
                  
                  3.15*2003
                      grant-date fair value
 As
        of
        March 31, 2006, there was an insignificant amount of total unrecognized
        compensation expense related to nonvested stock options granted under the
        Plan,
        which will be recognized by the end of the
 29
 third
        quarter of 2006.  The total fair value of shares vested was insignificant
        during the three months ended March 31, 2006 and 2005.
  **Performance
        Shares**
 The
        payment of performance shares is contingent upon achievement of specific
        performance goals over a stated period of time as approved by the Compensation
        and Development Committee of the Company’s Board of Directors. The number of
        performance shares ultimately paid can vary from the number of shares initially
        granted depending on Company performance, based on internal measures and
        market
        conditions, over stated performance periods. Performance shares have a value
        equal to the market value of the shares on the grant date with accruing
        dividends. Compensation expense, calculated by multiplying shares by the
        related
        grant-date fair value less the present value of dividends, and accrued dividends
        related to performance shares are recognized over the stated period.
  Performance
        share activity for the three months ended March 31, 2006, is summarized in
        the
        following table.
 **Grant
                      Date****Performance**
                  
                  **Shares**
                  
                  **Fair
                      Value***Beginning
                      balance
                  
                  172,761
                  
                  $
                  30.17Performance
                      adjustment
                  
                  (2,650
                  )Granted
                  
                  94,159
                  
                  
                  28.20Issued
                  
                  (9,499
                  )
                  
                  27.73Ending
                      balance
                  
                  
                  
                  
                  
                  254,771
                  
                  
                  29.56*weighted-average
 At
        March
        31, 2006, the remaining weighted-average contractual term was 1.9 years.
        The
        weighted-average grant-date fair value of shares granted during the three
        months
        ended March 31, 2006 and 2005, was $28.20 and $30.30, respectively. As of
        March
        31, 2006, there was $3.9 million of total unrecognized compensation expense,
        net
        of forfeiture rates, related to nonvested performance shares granted under
        the
        Plan, which will be recognized over the weighted-average contractual term. 
The total fair value of shares vested was insignificant during the three
        months
        ended March 31, 2006 and 2005.
  **Restricted
        Stock**
 Restricted
        stock cannot be sold or otherwise transferred by the recipient prior to vesting
        and has a value equal to the fair market value of the shares on the issued
        date.
        Restricted stock shares issued vest over a stated period of time with accruing
        reinvested dividends. Compensation expense, calculated by multiplying shares
        by
        the related grant-date fair value less the present value of dividends, and
        accrued dividends related to restricted stock are recognized over the stated
        vesting period.
  Restricted
        stock activity for the three months ended March 31, 2006, is summarized in
        the
        following table.
 **Nonvested**
                  
                  
                  
                  **Grant
                      Date****Restricted
                      stock**
                  
                  **Shares**
                  
                  **Fair
                      Value***Beginning
                      balance
                  
                  119,966
                  
                  $
                  30.50Issued
                  
                  46,826
                  
                  
                  28.20Ending
                      balance
                  
                  
                  
                  
                  
                  166,792
                  
                  
                  29.85*weighted-average
 At
        March
        31, 2006, the remaining weighted-average contractual term was 1.9 years.
        The
        weighted-average issued-date fair value of shares granted during the three
        months ended March 31, 2006 and 2005 was $28.20 and $30.27, respectively.
        As of
        March 31, 2006, there was $2.4 million of total unrecognized compensation
        expense, net of forfeiture rates, related to nonvested restricted stock
 30
 granted
        under the Plan, which will be recognized over the weighted-average contractual
        term.  No shares vested during the three months ended March 31, 2006 or
        2005.
  **11.**
            **TAXES**  Components
        of income taxes are detailed in the following tables.
 **Great
                      Plains Energy****Three
                      Months Ended March 31**
                  
                  **2006**
                  
                  **2005**Current
                      income taxes
                  
                  (millions)Federal
                  
                  $
                  10.5
                  
                  $
                  (1.2
                  )State
                  
                  
                  (0.2
                  )
                  
                  (2.8
                  )Total
                  
                  
                  10.3
                  
                  
                  (4.0
                  )Deferred
                      income taxesFederal
                  
                  
                  (14.1
                  )
                  
                  6.5State
                  
                  
                  (4.1
                  )
                  
                  3.8Total
                  
                  
                  (18.2
                  )
                  
                  10.3Investment
                      tax credit amortization
                  
                  
                  (0.8
                  )
                  
                  (1.0
                  )Total
                  
                  $
                  (8.7
                  )
                  $
                  5.3**Consolidated
                      KCP&L****Three
                      Months Ended March 31**
                  
                  
                  **2006**
                  
                  
                  **2005**Current
                      income taxes
                  
                  (millions)Federal
                  
                  $
                  6.6
                  
                  $
                  4.6State
                  
                  
                  0.7
                  
                  
                  0.4Total
                  
                  
                  7.3
                  
                  
                  5.0Deferred
                      income taxesFederal
                  
                  
                  (2.3
                  )
                  
                  (2.9
                  )State
                  
                  
                  (0.3
                  )
                  
                  (0.2
                  )Total
                  
                  
                  (2.6
                  )
                  
                  (3.1
                  )Investment
                      tax credit amortization
                  
                  
                  (0.8
                  )
                  
                  (1.0
                  )Total
                  
                  $
                  3.9
                  
                  $
                  0.9
 Income
        tax expense and the effective income tax rates reflected in the financial
        statements and the reasons for their differences from the statutory federal
        rates are detailed in the following tables.
 **Great
                      Plains Energy**
                  
                  **Income
                      Tax Expense**
                  
                  **Income
                      Tax Rate****Three
                      Months Ended March 31**
                  
                  **2006**
                  
                  **2005**
                  
                  **2006**
                  **2005**Federal
                      statutory income tax
                  
                  $
                  (3.8
                  )
                  $
                  8.9
                  
                  
                  35.0
                  %
                  
                  35.0
                  %Differences
                      between book and taxdepreciation
                      not normalized
                  
                  
                  0.2
                  
                  
                  0.3
                  
                  
                  (2.2
                  )
                  
                  1.2Amortization
                      of investment tax credits
                  
                  
                  (0.8
                  )
                  
                  (1.0
                  )
                  
                  7.1
                  
                  
                  (3.8
                  )Federal
                      income tax credits
                  
                  
                  (1.2
                  )
                  
                  (2.6
                  )
                  
                  11.1
                  
                  
                  (10.1
                  )State
                      income taxes
                  
                  
                  (1.8
                  )
                  
                  0.7
                  
                  
                  17.0
                  
                  
                  2.6Changes
                      in uncertian tax positions, net
                  
                  
                  (0.8
                  )
                  
                  0.3
                  
                  
                  7.3
                  
                  
                  1.3Manufacturing
                      deduction
                  
                  
                  (0.2
                  )
                  
                  (0.5
                  )
                  
                  2.1
                  
                  
                  (2.1
                  )Other
                  
                  
                  (0.3
                  )
                  
                  (0.8
                  )
                  
                  2.8
                  
                  
                  (3.3
                  )Total
                  
                  $
                  (8.7
                  )
                  $
                  5.3
                  
                  
                  80.2
                  %
                  
                  20.8
                  %
 31
 **Consolidated
                        KCP&L**
                    
                    **Income
                        Tax Expense**
                    
                    **Income
                        Tax Rate****Three
                        Months Ended March 31**
                    
                    **2006**
                    
                    **2005**
                    
                    **2006**
                    **2005**Federal
                        statutory income tax
                    
                    $
                    5.5
                    
                    $
                    3.9
                    
                    
                    35.0
                    %
                    
                    35.0
                    %Differences
                        between book and taxdepreciation
                        not normalized
                    
                    
                    0.2
                    
                    
                    0.3
                    
                    
                    1.5
                    
                    
                    2.8Amortization
                        of investment tax credits
                    
                    
                    (0.8
                    )
                    
                    (1.0
                    )
                    
                    (4.8
                    )
                    
                    (8.7
                    )State
                        income taxes
                    
                    
                    0.4
                    
                    
                    0.2
                    
                    
                    2.4
                    
                    
                    2.0Changes
                        in uncertian tax positions, net
                    
                    
                    0.1
                    
                    
                    0.2
                    
                    
                    0.8
                    
                    
                    1.6Manufacturing
                        deduction
                    
                    
                    (0.2
                    )
                    
                    (0.5
                    )
                    
                    (1.4
                    )
                    
                    (4.8
                    )Parent
                        company tax benefits
                    
                    
                    (1.1
                    )
                    
                    (1.5
                    )
                    
                    (7.0
                    )
                    
                    (13.8
                    )Other
                    
                    
                    (0.2
                    )
                    
                    (0.7
                    )
                    
                    (2.1
                    )
                    
                    (5.5
                    )Total
                    
                    $
                    3.9
                    
                    $
                    0.9
                    
                    
                    24.4
                    %
                    
                    8.6
                    %
 Great
        Plains Energy’s income taxes decreased $14.0 million for the three months ended
        March 31, 2006, compared to the same period of 2005 primarily due to a $35.4
        million decrease in pre-tax income. In addition, consolidated KCP&L’s income
        taxes increased $3.0 million primarily due to a $5.6 million increase in
        pre-tax income.
  The
        increase in the effective tax rate for Great Plains Energy for the three
        months
        ended March 31, 2006, compared to the same period of 2005 was primarily due
        to
        incurring a pre-tax loss in the current quarter, compared to pre-tax income
        in
        the same period of 2005. As a result, items such as federal income tax credits,
        investment tax credits and state income tax credits increase the effective
        rate,
        instead of reducing the effective rate, as in the prior period.
  **Uncertain
        Tax Positions**
 Management
        evaluates and records tax liabilities for uncertain tax positions based on
        the
        probability of ultimately sustaining the tax deductions or income positions.
        Management assesses the probabilities of successfully defending the tax
        deductions or income positions based upon statutory, judicial or administrative
        authority.
  At
        March
        31, 2006 and December 31, 2005, the Company had $4.2 million and
        $4.6 million ,
        respectively, of liabilities for uncertain tax positions related to tax
        deductions or income positions taken on the Company’s tax returns. Consolidated
        KCP&L had liabilities of $1.3 million and
        $1.2 million at
        March
        31, 2006 and December 31, 2005, respectively. Management believes the tax
        deductions or income positions are properly treated on such tax returns but
        has
        recorded reserves based upon its assessment of the probabilities that certain
        deductions or income positions may not be sustained when the returns are
        audited. The tax returns containing these tax deductions or income positions
        are
        currently under audit or will likely be audited. The timing of the resolution
        of
        these audits is uncertain. If the positions are ultimately sustained, the
        companies will reverse these tax provisions to net income. If the positions
        are
        not ultimately sustained, the companies may be required to make cash payments
        plus interest and/or utilize the companies’ federal and state credit
        carryforwards.
  **12.**
            **RELATED
                PARTY TRANSACTIONS AND RELATIONSHIPS**  Consolidated
        KCP&L receives various support and administrative services from Services.
        These services are billed to consolidated KCP&L at cost, based on payroll
        and other expenses, incurred by Services for the benefit of consolidated
        KCP&L. These costs totaled $4.4 million and
        $15.4
        million for the
        three months ended March 31, 2006 and 2005, respectively. These costs consisted
        primarily of employee compensation, benefits and fees associated with various
        professional services. At March 31, 2006 and December 31, 2005,
        consolidated KCP&L had a net intercompany payable to Services of $1.8
        million and
        $3.5
        million ,
        respectively. In the third quarter of 2005, approximately 80% of Services’
employees were transferred to KCP&L to better align resources with the
        operating business. At
 32
 March
        31,
        2006 and December 31, 2005, consolidated KCP&L’s balance sheets reflect
        HSS’s note payable to Great Plains Energy of $0.5 million.
  **13.**
            **COMMITMENTS
                AND CONTINGENCIES**  **Environmental
        Matters**
 The
        Company is subject to regulation by federal, state and local authorities
        with
        regard to air and other environmental matters primarily through KCP&L’s
        operations. The generation, transmission and distribution of electricity
        produces and requires disposal of certain hazardous products that are subject
        to
        these laws and regulations. In addition to imposing continuing compliance
        obligations, these laws and regulations authorize the imposition of substantial
        penalties for noncompliance, including fines, injunctive relief and other
        sanctions. Failure to comply with these laws and regulations could have a
        material adverse effect on consolidated KCP&L and Great Plains
        Energy.
  KCP&L
        operates in an environmentally responsible manner and seeks to use current
        technology to avoid and treat contamination. KCP&L regularly conducts
        environmental audits designed to ensure compliance with governmental regulations
        and to detect contamination. At March 31, 2006 and December 31, 2005,
        KCP&L had $0.3 million accrued
        for environmental remediation expenses. The accrual covers water monitoring
        at
        one site. The amounts accrued were established on an undiscounted basis and
        KCP&L does not currently have an estimated time frame over which the accrued
        amounts may be paid out.
  Environmental-related
        legislation is regularly introduced. Such legislation typically includes
        various
        compliance dates and compliance limits. Such legislation could have the
        potential for a significant financial impact on KCP&L, including the
        installation of new pollution control equipment to achieve compliance. However,
        KCP&L would seek recovery of capital costs and expenses for such compliance
        through rates. KCP&L will continue to monitor proposed
        legislation.
  The
        following table contains
        estimates of expenditures to comply with environmental laws and regulations
        described below. The allocation between states is based on location of the
        facilities and has no bearing as to recovery in jurisdictional
        rates.
 **Clean
                      Air Estimated Required**
                  
                  
                  
                  
                  
                  
                  
                  
                  
                  
                  **Estimated****Environmental
                      Expenditures**
                  
                  **Missouri**
                  **Kansas**
                  **Total**
                  **Timetable**(millions)CAIR
                  
                  $395
                  -
                  575
                  $
                  -
                  
                  $395
                  -
                  575
                  2005
                      - 2015Incremental
                      BART
                  
                  55
                  -
                  85
                  225
                  -
                  325
                  280
                  -
                  410
                  2005
                      - 2013Incremental
                      CAMR
                  
                  48
                  -
                  70
                  4
                  -
                  6
                  52
                  -
                  76
                  2010
                      - 2018Comprehensive
                      energy plan retrofits
                  
                  (171)
                  (101)
                  (272)
                  2006
                      - 2008Estimated
                      required environmental expenditures inexcess
                      of the comprehensive energy plan retrofits
                  $327
                  -
                  559
                  $128
                  -
                  230
                  $455
                  -
                  789
 Expenditure
        estimates provided in the table above include, but are not limited to, the
        accelerated environmental upgrade expenditures included in KCP&L’s
        comprehensive energy plan. These expenditures are expected to reduce
        SO 2 ,
        NO x ,
        mercury
        and air particulate matter. KCP&L’s expectation is that any such
        expenditures will be recovered through rates.
  ***Clean
        Air Interstate Rule***
 The
        Environmental Protection Agency (EPA) Clean Air Interstate Rule (CAIR) requires
        reductions in SO 2 and
        NO x emissions in 28 states, including Missouri. The reduction in both SO 2 and
        NO x emissions will be accomplished through establishment of permanent statewide
        caps
        for NO x effective January 1, 2009, and SO 2 effective January 1, 2010. More restrictive caps will be effective on
        January 1, 2015.
 33
 KCP&L’s
        fossil fuel-fired plants located in Missouri are subject to CAIR, while its
        fossil fuel-fired plants in Kansas are not.
  KCP&L
        expects to meet the emissions reductions required by CAIR at its Missouri
        plants
        through a combination of pollution control capital projects and the purchase
        of
        emission allowances in the open market as needed. The final rule establishes
        a
        market-based cap-and-trade program. Missouri has established a CAIR task
        force
        to determine an emission allowance allocation mechanism through a State
        Implementation Plan (SIP) that is expected to be issued by December 2006
        or
        early 2007. Facilities will demonstrate compliance with CAIR by holding
        sufficient allowances for each ton of SO 2 and
        NO x emitted
        in any given year with SO 2 emission
        allowances transferable among all regulated facilities nationwide and
        NO x emission
        allowances transferable among all regulated facilities within the 28 CAIR
        states. KCP&L will also be allowed to utilize unused SO 2 emission
        allowances that it has banked from previous years of the Acid Rain Program
        to
        meet the more stringent CAIR requirements. At March 31, 2006, KCP&L had
        banked just under 120,000 tons of SO 2 emission
        allowances, which are recorded in inventory at zero cost. KCP&L is permitted
        to sell excess SO 2 emission
        allowances in accordance with KCP&L’s comprehensive energy plan as approved
        by MPSC and KCC.
  Analysis
        of the final rule indicates that selective catalytic reduction technology
        for
        NO x control
        and scrubbers for SO 2 control
        will likely be required for KCP&L’s Montrose Station, in addition to the
        environmental upgrades at Iatan No. 1 included in the comprehensive energy
        plan.
        The timing of the installation of such control equipment is currently being
        developed. KCP&L continues to refine the preliminary cost estimates detailed
        in the table above and explore alternatives. The ultimate cost of these
        regulations could be significantly different from the amounts estimated.
        As
        discussed below, certain of the control technology for SO 2 and
        NO x will
        also aid in the control of mercury.
  ***Best
        Available Retrofit Technology Rule***
 The
        EPA
        best available retrofit technology rule (BART) directs state air quality
        agencies to identify whether visibility-reducing emissions from sources subject
        to BART are below limits set by the state or whether retrofit measures are
        needed to reduce emissions. BART applies to specific eligible facilities
        including LaCygne Nos. 1 and 2 in Kansas and Iatan No. 1 and Montrose No.
        3 in
        Missouri. The CAIR suggests that states that meet the CAIR requirements may
        also
        meet BART requirements for individual sources. Missouri is considering this
        proposal as part of the CAIR SIP, but no final decision has been reached.
        Kansas
        is not a CAIR state and therefore BART will likely impact LaCygne Nos. 1
        and 2.
        Kansas is in the process of completing modeling associated with the rule.
        States
        must submit a BART implementation plan in 2007 with required emission controls.
        If emission controls to comply with BART are required at LaCygne Nos. 1 and
        2,
        additional capital expenditures will be required above comprehensive energy
        plan
        upgrades. KCP&L continues to refine its preliminary cost estimates detailed
        in the table above and explore alternatives. The ultimate cost of these
        regulations could be significantly different from the amounts
        estimated.
  ***Mercury
        Emissions***
 The
        EPA
        Clean Air Mercury Rule (CAMR) regulates mercury emissions from coal-fired
        power
        plants located in 48 states, including Kansas and Missouri, under the New
        Source
        Performance Standards of the Clean Air Act. The rule established a market-based
        cap-and-trade program that will reduce nationwide utility emissions of mercury
        in two phases. The first phase cap is effective January 1, 2010, and will
        establish a permanent nationwide cap of 38 tons of mercury for coal-fired
        power
        plants. Management anticipates meeting the first phase cap by taking advantage
        of KCP&L’s mercury reductions achieved through capital expenditures to
        comply with CAIR and BART. The second phase is effective January 1, 2018,
        and
        will establish a permanent nationwide cap of 15 tons of mercury for coal-fired
        power plants. When fully implemented, the rule will reduce utility emissions
        of
        mercury by nearly 70% from current emissions of 48 tons per year.
 34
 Facilities
        will demonstrate compliance with the standard by holding allowances for each
        ounce of mercury emitted in any given year and allowances will be readily
        transferable among all regulated facilities nationwide. Under the cap-and-trade
        program, KCP&L will be able to purchase mercury allowances or elect to
        install pollution control equipment to achieve compliance. While it is expected
        that mercury allowances will be available in sufficient quantities for purchase
        in the 2010-2018 timeframe, the significant reduction in the nationwide cap
        in
        2018 may hamper KCP&L’s ability to obtain reasonably priced allowances
        beyond 2018. Management expects capital expenditures will be required to
        install
        additional pollution control equipment to meet the second phase cap. During
        the
        ensuing years, management will closely monitor advances in technology for
        removal of mercury from Powder River Basin (PRB) coal and expects to make
        decisions regarding second phase removal based on then available technology
        to
        meet the 2018 compliance date. The ultimate cost of this rule could be
        significantly different from the amounts estimated in the table above. KCP&L
        participated in the Department of Energy (DOE) National Energy Technology
        Laboratory project to investigate control technology options for mercury
        removal
        from coal-fired plants burning sub-bituminous coal.
  In
        2005,
        the EPA agreed to reconsider certain aspects of the rule and to invite
        additional comments on certain aspects of the rule. However, in its
        reconsideration notice, the EPA reiterated its position that the methodology
        used for the risk analysis performed to justify the CAMR is sound and
        scientifically justified. Comments were due in December 2005 but the EPA
        has not
        yet made an announcement on the reconsideration.
  ***Carbon
        Dioxide***
 The
        Clear
        Skies Initiative includes a climate change policy, which is a voluntary program
        that relies heavily on incentives to encourage industry to voluntarily limit
        emissions. The strategy includes tax credits, energy conservation programs,
        funding for research into new technologies, and a plan to encourage companies
        to
        track and report their emissions so that companies could gain credits for
        use in
        any future emissions trading program. The greenhouse strategy links growth
        in
        emissions of greenhouse gases to economic output. The administration's strategy
        is intended to reduce the greenhouse gas intensity of the U.S. economy by
        18% by
        2012. Greenhouse gas intensity measures the ratio of greenhouse gas emissions
        to
        economic output as measured by Gross Domestic Product (GDP). Under this plan,
        as
        the economy grows, greenhouse gases also would continue to grow, although
        at a
        slower rate than they would have without these policies in place. When viewed
        per unit of economic output, the rate of emissions would drop. The plan projects
        that the U.S. would lower its rate of greenhouse gas emissions from an estimated
        183 metric tons per $1 million of GDP in 2002 to 151 metric tons per
        $1 million of GDP by 2012.
  KCP&L
        is a member of the Power Partners through Edison Electric Institute (EEI).
        Power
        Partners is a voluntary program with the DOE under which utilities commit
        to
        undertake measures to reduce, avoid or sequester CO 2 emissions. Power Partners entered into a cooperative umbrella memorandum
        of
        understanding (MOU) with the DOE. This MOU contains supply and demand-side
        actions as well as offset projects that will be undertaken to reduce the
        power
        sector’s CO 2 emissions per kWh generated (carbon intensity), consistent with the EEI’s 2003
        commitment of a 3% to 5% reduction over the next decade.
  ***Air
        Particulate Matter and Ozone***
 The
        EPA
        standards for ozone and particulate matter air quality include an eight-hour
        ozone standard and a standard for particulate matter less than 2.5 microns
        (PM-2.5) in diameter. The EPA has designated the Kansas City area as attainment
        with respect to the PM-2.5 National Ambient Air Quality Standards (NAAQS).
        Additionally, the EPA designated Jackson, Platte, Clay and Cass counties
        in
        Missouri and Johnson, Linn, Miami and Wyandotte counties in Kansas as attainment
        with respect to the eight-hour ozone NAAQS.
 35
 In
        January 2006, the EPA published proposed revisions to the NAAQS for particulate
        matter. With regard to PM-2.5, the EPA proposed to reduce the level of the
        24-hour PM-2.5 standard from 65 to 35 micrograms per cubic meter and to retain
        the level of the annual PM-2.5 standard at 15 micrograms per cubic meter.
        With
        regard to particles generally less than or equal to 10 micrograms per cubic
        meter, PM-10, the EPA proposes to revise the 24-hour PM-10 standard by
        establishing a new indicator for coarse particles (particles generally between
        2.5 and 10 micrograms per cubic meter), PM-10-2.5, at a level of 70 micrograms
        per cubic meter. The EPA outlined certain alternatives and issues related
        to
        implementation of the proposed revisions and sought public comment. The EPA
        plans to take action on the proposal by September 2006. Management has not
        determined the impact of the proposed rule.
  ***Water
        Use Regulations***
 The
        EPA
        has established Clean Water Act standards for cooling water intake structures.
        This regulation applies to certain existing power producing facilities that
        employ cooling water intake structures that withdraw 50 million gallons or
        more
        per day and use 25% or more of that water for cooling purposes. KCP&L is
        required to complete a comprehensive demonstration study on each of its
        generating facilities’ intake structures by the end of 2007. The studies are
        expected to cost a total of $1.2 million to $2.0 million. Depending on the
        outcome of the comprehensive demonstration studies, facilities may be required
        to implement technological, operational or restoration measures to achieve
        compliance. Compliance with this regulation is expected to be achieved between
        2011 and 2014. Until the comprehensive demonstration studies are completed,
        the
        impact of this regulation cannot be quantified.
  KCP&L
        holds a permit from the Missouri Department of Natural Resources covering
        water
        discharge from its Hawthorn Station. The permit authorizes KCP&L, among
        other things, to withdraw water from the Missouri river for cooling purposes
        and
        return the heated water to the Missouri river. KCP&L has applied for a
        renewal of this permit and the EPA has submitted an interim objection letter
        regarding the allowable amount of heat that can be contained in the returned
        water. Until this matter is resolved, KCP&L continues to operate under its
        current permit. KCP&L cannot predict the outcome of this matter; however,
        while less significant outcomes are possible, this matter may require KCP&L
        to reduce its generation at Hawthorn Station, install cooling towers, or
        both.
        The outcome could also affect the terms of water permit renewals at KCP&L’s
        Iatan and Montrose Stations.
  **14.**
            **LEGAL
                PROCEEDINGS**  **Union
        Pacific**
 In
        2005,
        KCP&L filed a rate complaint case with the Surface Transportation Board
        (STB) charging that Union Pacific Railroad Company’s (Union Pacific) rates for
        transporting coal from the PRB in Wyoming to KCP&L’s Montrose Station are
        unreasonably high. Prior to the end of 2005, the rates were established under
        a
        contract with Union Pacific. Efforts to extend the term of the contract were
        unsuccessful and Union Pacific is the only service for coal transportation
        from
        the PRB to Montrose Station. KCP&L charged that Union Pacific possesses
        market dominance over the traffic and requested the STB prescribe maximum
        reasonable rates. In February 2006, the STB announced a rulemaking proceeding
        to
        address certain issues associated with the calculation of stand-alone costs
        in
        rate complaint cases. Proceedings in KCP&L’s rate complaint case have been
        suspended pending the outcome of this rulemaking, and management currently
        expects a decision in the case in 2008. Until the STB case is decided, KCP&L
        is paying tariff rates subject to refund.
  **Framatome**
 In
        2005,
        WCNOC filed a lawsuit on behalf of itself, KCP&L and the other two Wolf
        Creek owners against Framatome ANP, Inc., and Framatome ANP Richland, Inc.
        (Framatome) in the District Court of Coffey County, Kansas. The suit alleges
        various claims against Framatome related to the design, licensing and
        installation of a digital control system, which was not delivered. The suit
        seeks recovery of approximately $16 million in damages from Framatome.
        Framatome removed the case to U.S.
 36
 District
        Court for the District of Kansas. Thereafter, the plaintiffs filed a motion
        to
        remand the case back to Coffey County District Court, which was granted.
        Framatome has filed a counterclaim against the three Wolf Creek owners seeking
        recovery of damages alleged to be in excess of $20 million.
  **Hawthorn
        No. 5 Subrogation Litigation**
 KCP&L
        filed suit in 2001, in Jackson County, Missouri Circuit Court against multiple
        defendants who are alleged to have responsibility for the 1999 Hawthorn No.
        5
        boiler explosion. KCP&L and National Union Fire Insurance Company of
        Pittsburgh, Pennsylvania (National Union) have entered into a subrogation
        allocation agreement under which recoveries in this suit are generally allocated
        55% to National Union and 45% to KCP&L. Certain defendants have been
        dismissed from the suit and various defendants settled, with KCP&L receiving
        a total of $38.2 million, of which $18.5 million was
        recorded as a recovery of capital expenditures. Trial of this case with the
        one
        remaining defendant resulted in a March 2004 jury verdict finding KCP&L’s
        damages as a result of the explosion were $452 million. After deduction of
        amounts received from pre-trial settlements with other defendants and an
        amount
        for KCP&L’s comparative fault (as determined by the jury), the verdict would
        have resulted in an award against the defendant of approximately $97.6 million
        (of which KCP&L would have received $33 million pursuant to the subrogation
        allocation agreement after payment of attorney’s fees). In response to
        post-trial pleadings filed by the defendant, in 2004, the trial judge reduced
        the award against the defendant to $0.2 million. Both KCP&L and the
        defendant have appealed this case to the Court of Appeals for the Western
        District of Missouri. Oral arguments occurred in February 2006 and an opinion
        is
        expected later in 2006.
  **Spent
        Nuclear Fuel and Radioactive Waste**
 In
        2004,
        KCP&L and the other two Wolf Creek owners filed suit against the United
        States in the U.S. Court of Federal Claims seeking an unspecified amount
        of
        monetary damages resulting from the government’s failure to begin accepting
        spent fuel for disposal in January 1998, as the government was required to
        do by
        the Nuclear Waste Policy Act of 1982. Approximately sixty other similar cases
        are pending before that court. The court has stayed the Wolf Creek case until
        at
        least October 2006 to allow for some of the earlier cases to be decided first.
        Another federal court already has determined that the government breached
        its
        obligation to begin accepting spent fuel for disposal. The questions now
        before
        the court in the pending cases are whether and to what extent the utilities
        are
        entitled to monetary damages for that breach. KCP&L management cannot
        predict the outcome of the Wolf Creek case.
  **Class
        Action Complaint**
 In
        2005,
        a class action complaint for breach of contract was filed against Strategic
        Energy. The plaintiffs purportedly represent the interests of customers in
        Pennsylvania who entered into  Power
        Supply Coordination Service Agreements (Agreement) for the bundled product
        in
        Pennsylvania. The complaint seeks monetary damages, attorney fees and costs
        and
        a declaration that the customers may terminate their Agreement with Strategic
        Energy. Strategic Energy has filed preliminary objections asking the court
        to
        order plaintiffs to file an amended complaint that conforms to applicable
        court
        rules.
  **Haberstroh**
 In
        2004,
        Robert C. Haberstroh filed suit for breach of employment contract and violation
        of the Pennsylvania Wage Payment Collection Act against Strategic Energy
        Partners, Ltd. (Partners), SE Holdings, L.L.C. (SE Holdings) and Strategic
        Energy in the Court of Common Pleas of Allegheny County, Pennsylvania. In
        the
        first quarter of 2006, the suit was settled and as part of the settlement,
        Great
        Plains Energy acquired the remaining indirect interest in Strategic Energy
        for
        an insignificant amount.
 37
 **KLT
        Telecom**
 On
        December 31, 2001, a subsidiary of KLT Telecom Inc. (KLT Telecom), DTI Holdings,
        Inc. (Holdings) and its subsidiaries Digital Teleport Inc. (Digital Teleport)
        and Digital Teleport of Virginia, Inc., filed separate voluntary petitions
        in
        the Bankruptcy Court for the Eastern District of Missouri for reorganization
        under Chapter 11 of the U.S. Bankruptcy Code. DTI Holdings and its two
        subsidiaries are collectively called “DTI.” In 2003, the Bankruptcy Court
        confirmed the plan of reorganization for these three companies, which included
        the sale of substantially all assets.
  KLT
        Telecom originally acquired a 47% interest in DTI in 1997. On February 8,
        2001,
        KLT Telecom acquired control of DTI by purchasing shares from another Holdings
        shareholder, Richard D. Weinstein (Weinstein), increasing its ownership to
        83.6%. In connection with this purchase, KLT Telecom granted Weinstein a
        put
        option. The put option provided for the sale by Weinstein of his remaining
        shares in Holdings to KLT Telecom during a period beginning September 1,
        2003,
        and ending August 31, 2005. The put option provides for an aggregate exercise
        price for these remaining shares equal to their fair market value with an
        aggregate floor amount of $15 million. The floor amount of the put option
        was
        fully reserved during 2001. On September 2, 2003, Weinstein delivered to
        KLT
        Telecom notice of the exercise of his put option. KLT Telecom declined to
        pay
        Weinstein any amount under the put option because, among other things, the
        stock
        of Holdings had been cancelled and extinguished pursuant to the joint Chapter
        11
        plan confirmed by the Bankruptcy Court. Weinstein has sued KLT Telecom for
        allegedly breaching the put option and seeks damages of at least $15 million
        plus statutory interest. In April 2005, summary judgment in the Weinstein
        litigation was granted in favor of KLT Telecom, and Weinstein has appealed
        this
        judgment to the Missouri Court of Appeals for the Eastern District. The $15
        million reserve has not been reversed pending the outcome of the appeal process,
        which management expects will conclude in 2006.
  **15.**
            **SEGMENT
                AND RELATED INFORMATION**  **Great
        Plains Energy**
 Great
        Plains Energy has two reportable segments based on its method of internal
        reporting, which generally segregates the reportable segments based on products
        and services, management responsibility and regulation. The two reportable
        business segments are KCP&L, an integrated, regulated electric utility and
        Strategic Energy, a competitive electricity supplier. Other includes the
        operations of HSS, Services, all KLT Inc. operations other than Strategic
        Energy, unallocated corporate charges, consolidating entries and intercompany
        eliminations. Intercompany eliminations include insignificant amounts of
        intercompany financing related activities. The summary of significant accounting
        policies applies to all of the reportable segments. For segment reporting,
        each
        segment’s income taxes include the effects of allocating holding company tax
        benefits. Segment performance is evaluated based on net income.
 38
 The
        following tables reflect
        summarized financial information concerning Great Plains Energy’s reportable
        segments.
 **Three
                    Months Ended**
                
                
                **Strategic**
                
                
                
                **Great
                    Plains****March
                    31, 2006**
                **KCP&L**
                
                **Energy**
                
                **Other**
                
                **Energy**(millions)Operating
                    revenues
                $
                240.4
                
                $
                318.8
                
                $
                -
                
                $
                559.2Depreciation
                    and amortization
                
                (37.0
                )
                
                (1.9
                )
                
                -
                
                
                (38.9
                )Interest
                    charges
                
                (14.9
                )
                
                (0.3
                )
                
                (2.1
                )
                
                (17.3
                )Income
                    taxes
                
                (3.9
                )
                
                9.9
                
                
                2.7
                
                
                8.7Loss
                    from equity investments
                
                -
                
                
                -
                
                
                (0.3
                )
                
                (0.3
                )Net
                    income (loss)
                
                12.0
                
                
                (10.9
                )
                
                (3.2
                )
                
                (2.1
                )
 **Three
                    Months Ended**
                
                
                **Strategic**
                
                
                
                **Great
                    Plains****March
                    31, 2005**
                **KCP&L**
                
                **Energy**
                
                **Other**
                
                **Energy**(millions)Operating
                    revenues
                $
                233.2
                
                $
                311.8
                
                $
                0.1
                
                $
                545.1Depreciation
                    and amortization
                
                (36.3
                )
                
                (1.5
                )
                
                (0.1
                )
                
                (37.9
                )Interest
                    charges
                
                (14.6
                )
                
                (0.8
                )
                
                (2.1
                )
                
                (17.5
                )Income
                    taxes
                
                (1.5
                )
                
                (8.5
                )
                
                4.7
                
                
                (5.3
                )Loss
                    from equity investments
                
                -
                
                
                -
                
                
                (0.3
                )
                
                (0.3
                )Net
                    income (loss)
                
                10.8
                
                
                12.8
                
                
                (3.4
                )
                
                20.2
 **Strategic**
                  
                  
                  
                  **Great
                      Plains****KCP&L**
                  
                  **Energy**
                  
                  **Other**
                  
                  **Energy****March
                      31, 2006**
                  (millions)Assets
                  $
                  3,377.6
                  
                  $
                  399.3
                  
                  $
                  42.0
                  
                  $
                  3,818.9Capital
                      expenditures(a)
                  
                  73.9
                  
                  
                  1.1
                  
                  
                  0.3
                  
                  
                  75.3**December
                      31, 2005**Assets
                  $
                  3,334.6
                  
                  $
                  441.8
                  
                  $
                  57.3
                  
                  $
                  3,833.7Capital
                      expenditures(a)
                  
                  332.2
                  
                  
                  6.6
                  
                  
                  (4.7
                  )
                  
                  334.1(a)Capital
                      expenditures reflect year to date amounts for the periods
                      presented.
 39
 **Consolidated
        KCP&L**
 The
        following tables reflect
        summarized financial information concerning consolidated KCP&L’s reportable
        segment. Other includes the operations of HSS and intercompany eliminations.
        Intercompany eliminations include insignificant amounts of intercompany
        financing related activities.
 **Three
                      Months Ended**
                  
                  
                  
                  
                  
                  **Consolidated****March
                      31, 2006**
                  
                  **KCP&L**
                  
                  **Other**
                  
                  **KCP&L**(millions)Operating
                      revenues
                  
                  $
                  240.4
                  
                  $
                  -
                  
                  $
                  240.4Depreciation
                      and amortization
                  
                  
                  (37.0
                  )
                  
                  -
                  
                  
                  (37.0
                  )Interest
                      charges
                  
                  
                  (14.9
                  )
                  
                  -
                  
                  
                  (14.9
                  )Income
                      taxes
                  
                  
                  (3.9
                  )
                  
                  -
                  
                  
                  (3.9
                  )Net
                      income
                  
                  
                  12.0
                  
                  
                  -
                  
                  
                  12.0**Three
                      Months Ended**
                  
                  
                  
                  
                  
                  
                  
                  **Consolidated****March
                      31, 2005**
                  
                  **KCP&L**
                  
                  **Other**
                  
                  **KCP&L**(millions)Operating
                      revenues
                  
                  $
                  233.2
                  
                  $
                  0.1
                  
                  $
                  233.3Depreciation
                      and amortization
                  
                  
                  (36.3
                  )
                  
                  (0.1
                  )
                  
                  (36.4
                  )Interest
                      charges
                  
                  
                  (14.6
                  )
                  
                  -
                  
                  
                  (14.6
                  )Income
                      taxes
                  
                  
                  (1.5
                  )
                  
                  0.6
                  
                  
                  (0.9
                  )Net
                      income (loss)
                  
                  
                  10.8
                  
                  
                  (0.5
                  )
                  
                  10.3
 **Consolidated****KCP&L**
                  
                  **Other**
                  
                  **KCP&L****March
                      31, 2006**
                  
                  (millions)Assets
                  
                  $
                  3,377.6
                  
                  $
                  3.7
                  
                  $
                  3,381.3Capital
                      expenditures(a)
                  
                  
                  73.9
                  
                  
                  -
                  
                  
                  73.9**December
                      31, 2005**Assets
                  
                  $
                  3,334.6
                  
                  $
                  3.9
                  
                  $
                  3,338.5Capital
                      expenditures(a)
                  
                  
                  332.2
                  
                  
                  -
                  
                  
                  332.2(a)Capital
                      expenditures reflect year to date amounts for the periods
                      presented.
 **16.**
            **DERIVATIVE
                INSTRUMENTS**  The
        companies are exposed to a variety of market risks including interest rates
        and
        commodity prices. Management has established risk management policies and
        strategies to reduce the potentially adverse effects that the volatility
        of the
        markets may have on the companies’ operating results. The risk management
        activities, including the use of derivative instruments, are subject to the
        management, direction and control of internal risk management committees.
        Management’s interest rate risk management strategy uses derivative instruments
        to adjust the companies’ liability portfolio to optimize the mix of fixed and
        floating rate debt within an established range. In addition, management uses
        derivative instruments to hedge against future interest rate fluctuations
        on
        anticipated debt issuances. Management maintains commodity-price risk management
        strategies that use derivative instruments to reduce the effects of fluctuations
        in fuel and purchased power expense caused by commodity price volatility.
        Counterparties to commodity derivatives and interest rate swap agreements
        expose
        the companies to credit loss in the event of nonperformance. This credit
        loss is
        limited to the cost of replacing these contracts at current market rates
        less
        the application of counterparty collateral held. Derivative instruments,
        excluding those instruments that qualify for the Normal Purchases and Normal
        Sales (NPNS) election, which are accounted for by accrual accounting, are
        recorded on the balance
 40
 sheet
        at
        fair value as an asset or liability. Changes in the fair value are recognized
        currently in net income unless specific hedge accounting criteria are
        met.
  **Fair
        Value Hedges - Interest Rate Risk Management**
 In
        2002,
        KCP&L remarketed its 1998 Series A, B and D EIRR bonds totaling $146.5
        million to a five-year fixed interest rate of 4.75% ending October 1, 2007.
        Simultaneously with the remarketing, KCP&L entered into an interest rate
        swap for the $146.5 million based on the London Interbank Offered Rate (LIBOR)
        to effectively create a floating interest rate obligation. The transaction
        is a
        fair value hedge with no ineffectiveness. Changes in the fair market value
        of
        the swap are recorded on the balance sheet as an asset or liability with
        an
        offsetting entry to the respective debt balances with no net impact on net
        income.
  **Cash
        Flow Hedges - Forward Starting Swaps**
 In
        the
        first quarter of 2006, KCP&L entered into two Forward Starting Swaps (FSS)
        to hedge against interest rate fluctuations on the long-term debt that KCP&L
        plans to issue before the end of the first quarter of 2007. The FSS will
        be
        settled simultaneously with the issuance of the long-term fixed rate debt.
        The
        FSS effectively removes most of the interest rate and credit spread uncertainty
        with respect to the debt to be issued, thereby enabling KCP&L to predict
        with greater assurance what its future interest costs on that debt will be.
        The
        FSS is accounted for as a cash flow hedge and the fair value is recorded
        as a
        current asset or liability with an offsetting entry to OCI, to the extent
        the
        hedge is effective, until the forecasted transaction occurs. No ineffectiveness
        has been recorded on the FSS. The pre-tax gain or loss on the FSS recorded
        to
        OCI will be reclassified to interest expense over the life of the future
        debt
        issuance.
  **Cash
        Flow Hedges - Commodity Risk Management**
 KCP&L’s
        risk management policy is to use derivative instruments to mitigate its exposure
        to market price fluctuations on a portion of its projected natural gas purchases
        to meet generation requirements for retail and firm wholesale sales. As of
        March
        31, 2006, KCP&L had hedged approximately 45% of its 2006 projected natural
        gas usage for retail load and firm MWh sales. The fair values of these
        instruments are recorded as current assets or current liabilities with an
        offsetting entry to OCI for the effective portion of the hedge. To the extent
        the hedges are not effective, the ineffective portion of the change in fair
        market value is recorded currently in fuel expense. KCP&L did not record any
        gains or losses due to ineffectiveness during the three months ended March
        31,
        2006 and 2005. When the natural gas is purchased, the amounts in OCI are
        reclassified to fuel expense in the consolidated income statement.
  Strategic
        Energy maintains a commodity-price risk management strategy that uses forward
        physical energy purchases and other derivative instruments to reduce the
        effects
        of fluctuations in purchased power expense caused by commodity-price volatility.
        Derivative instruments are used to limit the unfavorable effect that price
        increases will have on electricity purchases, effectively fixing the future
        purchase price of electricity for the applicable forecasted usage and protecting
        Strategic Energy from significant price volatility. The maximum term over
        which
        Strategic Energy hedged its exposure and variability of future cash flows
        was
        approximately five years at March 31, 2006 and December 31, 2005.
  Certain
        forward fixed price purchases and swap agreements are designated as cash
        flow
        hedges. The fair values of these instruments are recorded as assets or
        liabilities with an offsetting entry to OCI for the effective portion of
        the
        hedge. To the extent the hedges are not effective, the ineffective portion
        of
        the change in fair market value is recorded currently in purchased power.
        When
        the forecasted purchase is completed, the amounts in OCI are reclassified
        to
        purchased power. Purchased power expense for the three months ended March
        31,
        2006 and 2005, includes a $10.6 million loss and $2.1 million gain,
        respectively, due to ineffectiveness of the cash flow hedges.
 41
 As
        part
        of its commodity-price risk management strategy, Strategic Energy also enters
        into economic hedges (non-hedging derivatives) that do not qualify for cash
        flow
        hedge accounting. The changes in the fair value of these derivative instruments
        recorded as a component of purchased power expense were a $25.3 million loss
        and
        $2.9 million gain for the three months ended March 31, 2006 and 2005,
        respectively.
  The
        fair
        value of non-hedging derivatives at March 31, 2006, also includes certain
        forward contracts at Strategic Energy that were amended during 2005. Prior
        to
        being amended, the contracts were accounted for under the NPNS election in
        accordance with SFAS No. 133. As a result of being amended, the contracts
        no
        longer qualify for NPNS exceptions or cash flow hedge accounting and are
        now
        accounted for as non-hedging derivatives with the fair value at amendment
        being
        recorded as a deferred liability that will be reclassified to net income
        as the
        contracts settle. In the first quarter of 2006, Strategic Energy amortized
        $3.7
        million of the deferred liability to purchased power expense related to the
        delivery of power under the contracts. Strategic Energy will amortize the
        remaining deferred liability over the remaining original contract lengths,
        which
        end in the first quarter of 2008. Strategic Energy is recording the change
        in
        fair value of these contracts after the amendment as a component of purchased
        power expense.
  The
        notional and recorded fair values of the companies’ derivative instruments are
        summarized in the following table. The fair values of these derivatives are
        recorded on the consolidated balance sheets.
 **March
                      31**
                  
                  **December
                      31****2006**
                  
                  **2005****Notional**
                  
                  
                  
                  **Notional****Contract**
                  
                  **Fair**
                  
                  **Contract**
                  
                  **Fair****Amount**
                  
                  **Value**
                  
                  **Amount**
                  
                  **Value****Great
                      Plains Energy**
                  
                  (millions)Swap
                      contractsCash
                      flow hedges
                  
                  $
                  218.3
                  
                  $
                  (4.6
                  )
                  $
                  164.7
                  
                  $
                  23.8Non-hedging
                      derivatives
                  
                  
                  53.3
                  
                  
                  (4.4
                  )
                  
                  35.5
                  
                  
                  -Forward
                      contractsCash
                      flow hedges
                  
                  
                  206.9
                  
                  
                  3.4
                  
                  
                  121.9
                  
                  
                  21.0Non-hedging
                      derivatives
                  
                  
                  266.9
                  
                  
                  (21.0
                  )
                  
                  178.3
                  
                  
                  3.6Forward
                      starting swapCash
                      flow hedges
                  
                  
                  225.0
                  
                  
                  3.8
                  
                  
                  -
                  
                  
                  -Interest
                      rate swapsFair
                      value hedges
                  
                  
                  146.5
                  
                  
                  (3.2
                  )
                  
                  146.5
                  
                  
                  (2.6
                  )**Consolidated
                      KCP&L**Forward
                      contractsCash
                      flow hedges
                  
                  
                  7.5
                  
                  
                  (0.4
                  )
                  
                  -
                  
                  
                  -Forward
                      starting swapCash
                      flow hedges
                  
                  
                  225.0
                  
                  
                  3.8
                  
                  
                  -
                  
                  
                  -Interest
                      rate swapsFair
                      value hedges
                  
                  
                  146.5
                  
                  
                  (3.2
                  )
                  
                  146.5
                  
                  
                  (2.6
                  )
 42
 The
        amounts recorded in accumulated OCI related to the cash flow hedges are
        summarized in the following table.
 **Great
                      Plains Energy**
                  
                  **Consolidated
                      KCP&L****March
                      31**
                  
                  **December
                      31**
                  
                  **March
                      31**
                  
                  **December
                      31****2006**
                  
                  **2005**
                  
                  **2006**
                  
                  **2005**(millions)Current
                      assets
                  
                  $
                  23.1
                  
                  
                  $
                  35.8
                  
                  
                  $
                  15.6
                  
                  
                  $
                  11.9Other
                      deferred charges
                  
                  
                  5.3
                  
                  
                  
                  11.8
                  
                  
                  
                  -
                  
                  
                  
                  -Other
                      current liabilities
                  
                  
                  (5.3
                  )
                  
                  
                  1.6
                  
                  
                  
                  (0.4
                  )
                  
                  
                  -Deferred
                      income taxes
                  
                  
                  (7.1
                  )
                  
                  
                  (20.5
                  )
                  
                  
                  (5.7
                  )
                  
                  
                  (4.5
                  )Other
                      deferred credits
                  
                  
                  (4.5
                  )
                  
                  
                  1.0
                  
                  
                  
                  -
                  
                  
                  
                  -Total
                  
                  $
                  11.5
                  
                  
                  $
                  29.7
                  
                  
                  $
                  9.5
                  
                  
                  $
                  7.4
 Great
          Plains Energy’s accumulated OCI includes $2.6 million that is expected to be
          reclassified to expense over the next twelve months. Consolidated KCP&L’s
          accumulated OCI includes an insignificant amount that is expected to be
          reclassified to expense over the next twelve months.
 The
        amounts reclassified to expenses are summarized in the following
        table.
 **Three
                      Months Ended March 31**
                  
                  **2006**
                  
                  **2005****Great
                      Plains Energy**
                  
                  (millions)Purchased
                      power expense
                  
                  $
                  9.1
                  
                  $
                  (3.6
                  )Income
                      taxes
                  
                  
                  (3.9
                  )
                  
                  1.5OCI
                  
                  $
                  5.2
                  
                  $
                  (2.1
                  )
 An
        insignificant amount was reclassed from OCI as reduction of interest expense
        related to the 2005 T-Locks for Great Plains Energy and consolidated
        KCP&L.
 43


**ITEM
      2. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF
      OPERATIONS**




The
      MD&A that follows is a combined presentation for Great Plains Energy and
      consolidated KCP&L, both registrants under this filing. The discussion and
      analysis by management focuses on those factors that had a material effect
      on
      the financial condition and results of operations of the registrants during
      the
      periods presented.




Great
      Plains Energy is a public utility holding company and does not own or operate
      any significant assets other than the stock of its subsidiaries. Great Plains
      Energy’s direct subsidiaries with operations or active subsidiaries are
      KCP&L, KLT Inc., IEC and Services. As a diversified energy company, Great
      Plains Energy’s reportable business segments include KCP&L and Strategic
      Energy.




**EXECUTING
      ON STRATEGIC INTENT**


**KCP&L’s
      Comprehensive Energy Plan**


KCP&L
      continues to make progress in implementing its comprehensive energy plan and
      orders received from the Public Service Commission of the State of Missouri
      (MPSC) and The State Corporation Commission of the State of Kansas (KCC) in
      2005. The Sierra Club and Concerned Citizens of Platte County have appealed
      the
      MPSC order, and the Sierra Club has appealed the KCC order. In March 2006,
      the
      Circuit Court of Cole County, Missouri, affirmed the MPSC Order and the Sierra
      Club has appealed the decision to the Missouri Court of Appeals. The Kansas
      District Court denied the Sierra Club’s appeal in May 2006. The Sierra Club may
      appeal to the Kansas Court of Appeals. Although subject to the appeals, the
      MPSC
      and KCC orders remain in effect pending the applicable court’s decision.




In
      February 2006 ,
      KCP&L filed requests with the MPSC and KCC for annual rate increases of
      $55.8 million or 11.5% and $42.3 million or 10.5%, respectively. The
      requested rate increases reflect recovery of increasing operating costs
      including fuel, transportation and pensions as well as investments in wind
      generation and customer programs and compensation for wholesale sales volatility
      and construction risks. The request is based on a return on equity of 11.5%
      and
      an adjusted equity ratio of 53.8%. Discovery is underway and management
      anticipates that approved rate adjustments for both jurisdictions will go into
      effect January 1, 2007. Formal evidentiary hearings before the MPSC and KCC
      are
      scheduled for October 2006.




KCP&L
      has initiated construction of its 100.5 MW wind
      project located in Spearville, Kansas. Management expects the project to be
      completed and on-line in time for inclusion in the current rate cases. A request
      to the Southwest Power Pool, Inc. (SPP) has been made for firm transmission
      capacity. Management expects a response to its request in the second quarter
      of
      2006. The environmental upgrades at LaCygne No. 1 began with the spring outage
      in the first quarter of 2006 and will be completed during the spring 2007
      outage. An owner’s engineer has been hired and the engineering design for Iatan
      Station is in progress. The Iatan No. 2 boiler and steam turbine and the Iatan
      Nos. 1 and 2 air emission control equipment procurement is in progress and
      plant construction is expected to start in 2006. Although contracting is not
      complete, developing market conditions indicate a potential increase in the
      overall cost estimates of the comprehensive energy plan in the range of 10%
      to
      20%. The primary drivers are increases in materials and labor costs and some
      scope additions. Management anticipates completion of its definitive estimates
      by August. The definitive estimates could be materially different than the
      current estimates; however, management believes project costs will be
      competitive with other similar projects.




In
      the
      first quarter of 2006, KCP&L received its air permit and a water quality
      certification from the Missouri Department of Natural Resources. The Sierra
      Club
      is appealing the air permit. KCP&L


44


anticipates
      issuances of a wetlands permit, a permit for the construction of a temporary
      barge slip and an Environmental Assessment with a finding of No Significant
      Impact toward mid-year 2006.




**KCP&L
      BUSINESS OVERVIEW**




KCP&L
      is an integrated, regulated electric utility that engages in the generation,
      transmission, distribution and sale of electricity. KCP&L has over
      4,000 MWs of
      generating capacity and has transmission and distribution facilities that
      provide electricity to slightly over 500,000 customers in the states of Missouri and Kansas. KCP&L has continued to
      experience modest load growth. Load growth consists of higher usage per customer
      and the addition of new customers. Retail electricity rates are below the
      national average.




KCP&L’s
      residential customers’ usage patterns are significantly affected by weather.
      Bulk power sales, the major component of wholesale sales, vary with system
      requirements, generating unit and purchased power availability, fuel costs
      and
      requirements of other electric systems. Less than 1% of revenues include an
      automatic fuel adjustment provision. KCP&L’s coal base load equivalent
      availability factor increased to 80 %
      for the
      three months ended March 31, 2006, from 78 %
      for the
      same period in 2005.




KCP&L’s
      nuclear unit, Wolf Creek, accounts for approximately 20% of its base load
      capacity. Replacement power costs for scheduled Wolf Creek outages are accrued
      evenly over the unit’s 18-month operating cycle. The next refueling outage is
      scheduled to begin in October 2006. Management expects its cost of nuclear
      fuel
      to remain relatively stable through 2009 because
      of contracts in place.




The
      fuel
      cost per MWh generated and the purchased power cost per MWh has a significant
      impact on the results of operations for KCP&L. Generation fuel mix can
      substantially change the fuel cost per MWh generated. Nuclear fuel cost per
      MWh
      generated is substantially less than the cost of coal per MWh generated, which
      is significantly lower than the cost of natural gas and oil per MWh generated.
      The cost per MWh for purchased power is significantly higher than the cost
      per
      MWh of coal and nuclear generation. KCP&L continually evaluates its system
      requirements, the availability of generating units, availability and cost of
      fuel supply and purchased power, and the requirements of other electric systems
      to provide reliable power economically.




Rail
      companies have experienced longer cycle times for coal deliveries to utilities
      across the country since 2004. Approximately 98% of KCP&L’s coal
      requirements come from the PRB and originate on the Burlington Northern Santa
      Fe
      and the Union Pacific railroads, both of which have been affected by the current
      rail situation. Maintenance to repair significant sections of track on this
      rail
      line began in 2005 and is expected to be completed by the end of 2006. These
      repairs must be completed before normal train operations from the PRB can
      resume, which affects all users of PRB coal. As a result, most utilities,
      including KCP&L, have coal inventories that are below desired levels. KCP&L
      continued its coal conservation measures by reducing coal generation in the
      first quarter of 2006 and expects the conservation to continue throughout 2006. Reduction
      in coal generation in the marketplace continues to cause upward pressure on
      both
      pricing for next power generation fuel sources (natural gas and/or oil) and
      wholesale electricity prices. The rail companies have indicated that they expect
      the impact related to the 2006 maintenance program to be less than the 10%
      to
      15% reduction in deliveries experienced in 2005, but have offered no estimate
      on
      the likely reduction. Management
      cannot predict with any certainty the 2006 impact of the situation; however,
      an
      inability to obtain timely delivery of coal to meet generation requirements
      could materially impact KCP&L’s results of operations by increasing its cost
      to serve its retail customers and/or reducing wholesale MWh sales. Management
      is
      monitoring the situation closely and steps will be taken, as necessary, to
      maintain an adequate energy supply for KCP&L’s retail load and firm MWh
      sales.


45


**STRATEGIC
      ENERGY BUSINESS OVERVIEW**




Great
      Plains Energy indirectly owns 100% of Strategic Energy. Strategic Energy does
      not own any generation, transmission or distribution facilities. Strategic
      Energy provides competitive retail electricity supply services by entering
      into
      power supply contracts to supply electricity to its end-use customers. Of the
      states that offer retail choice, Strategic Energy operates in California,
      Maryland, Massachusetts, Michigan, New Jersey, New York, Ohio, Pennsylvania
      and
      Texas.




In
      addition to competitive retail electricity supply services, Strategic Energy
      records insignificant wholesale revenues and purchased power expense incidental
      to the retail services provided. Strategic Energy also provides strategic
      planning, consulting and billing and scheduling services in the natural gas
      and
      electricity markets. The cost of supplying electricity to retail customers
      can
      vary widely by geographic market. This variability can be affected by many
      factors, including, but not limited to, geographic differences in the cost
      per
      MWh of purchased power, renewable energy requirements and capacity charges
      due
      to regional purchased power availability and requirements of other electricity
      providers and differences in transmission charges.




Strategic
      Energy may provide periodic billing credits to customers under certain fixed
      price contracts based on results from power supply coordination efforts. The
      amounts credited back to the customer are treated as a reduction of retail
      electric revenues when determined to be payable.




Strategic
      Energy provides services to approximately 49,200 commercial, institutional and small manufacturing accounts for approximately
      12,700 customers including numerous Fortune 500 companies, smaller companies and
      governmental entities. Strategic Energy offers an array of products, including
      fixed price, index-based and month-to-month renewal products, designed to meet
      the various requirements of a diverse customer base. Strategic Energy’s
      volume-based customer retention rate, excluding month-to-month customers on
      market-based rates, was 50 %
      for the
      three months ended March 31, 2006. The corresponding volume-based customer
      retention rate including month-to-month customers on market-based rates was
      62 %.
      Retention rates for the three months ended March 31, 2006, are lower than
      Strategic Energy’s experience. The decline is attributable to customer contract
      expirations in midwestern states where the savings competitive suppliers can
      offer to customers are reduced or in some cases unavailable due to host utility
      default rates that are not aligned with market prices for power. In these
      states, customers can receive better rates from the host utility and are
      choosing to return to host utility service as their contracts with Strategic
      Energy expire. Management expects to have continued difficulty competing in
      these states until more competitive market-driven pricing mechanisms are in
      place or market prices for power decrease below host utility rates.




Management
      has repositioned sales and marketing efforts to focus on states that currently
      provide a more competitive pricing environment in relation to host utility
      default rates. In these states, Strategic Energy continues to experience
      improvement in certain key metrics, including strong forecasted future MWh
      commitments (backlog) growth and longer contract durations. In addition to
      the
      repositioning efforts, management believes customer perceptions about the
      longer-term price of electricity may be changing as a result of the prolonged
      period of high and volatile power prices seen in the last few years and
      customers may be more willing to enter into long-term contracts in order to
      achieve price certainty. Management believes, but cannot assure, that these
      trends may continue throughout 2006. MWhs delivered in 2006 are projected to
      range from 16 to 18 million. Based solely on expected usage under current signed
      contracts, Strategic Energy has backlog of 10.1 million, 6.5 million and
      3.6 million
      for the years 2006 through 2008, respectively. Strategic Energy expects to
      deliver additional MWhs in these years through new and renewed term contracts
      and MWh deliveries to month-to-month customers.


46


Based
      on
      the latest information available, management currently expects Strategic
      Energy’s retail gross margin (retail revenues less retail purchased power
      divided by retail MWhs delivered) per MWh on new customer contracts entered
      into
      in 2006 to average from $3.00 to $4.00, excluding unrealized changes in fair
      value. Management expects to realize additional retail gross margin on fixed
      price contracts of up to $0.50 per MWh over the life of the contract. The
      additional expected margin is derived from management of the retail portfolio
      load requirements. These activities include benefits from financial transmission
      rights and auction revenue rights, short-term load balancing activities,
      short-term arbitrage activities and identifying and executing on favorable
      transmission paths. Actual retail gross margin per MWh may differ from these
      estimates. See Part II Item 1A. Risk Factors for additional
      information.




**GREAT
      PLAINS ENERGY RESULTS OF OPERATIONS**




The
      following table summarizes
      Great Plains Energy’s comparative results of operations.


**Three
                  Months Ended March 31**
              **2006**
              
              **2005**(millions)Operating
                  revenues
              $
              559.2
              
              $
              545.1Fuel
              
              (47.4
              )
              
              (41.5
              )Purchased
                  power
              
              (330.9
              )
              
              (289.4
              )Other
                  operating expenses
              
              (126.5
              )
              
              (135.0
              )Skill
                  set realignment costs
              
              (9.4
              )
              
              -Depreciation
                  and amortization
              
              (38.9
              )
              
              (37.9
              )Gain
                  (loss) on property
              
              (0.1
              )
              
              0.5Operating income
              
              6.0
              
              
              41.8Non-operating
                  income (expenses)
              
              0.8
              
              
              0.6Interest
                  charges
              
              (17.3
              )
              
              (17.5
              )Income
                  taxes
              
              8.7
              
              
              (5.3
              )Minority
                  interest in subsidiaries
              
              -
              
              
              0.9Loss
                  from equity investments
              
              (0.3
              )
              
              (0.3
              )Net income (loss)
              
              (2.1
              )
              
              20.2Preferred
                  dividends
              
              (0.4
              )
              
              (0.4
              )Earnings (loss) available for common shareholders
              $
              (2.5
              )
              $
              19.8


Great
      Plains Energy’s earnings for the three months ended March 31, 2006, decreased to
      a loss of $2.5 million, or $0.03 loss per share ,
      from
      earnings of $19.8 million, or $0.27 per share ,
      in the
      same period of 2005.




Consolidated
      KCP&L’s net income increased $1.7 million for the three months ended
      March 31, 2006, compared to the same period in 2005 primarily due to higher
      wholesale revenues and lower purchased power and other operating expenses.
      These
      increases to net income were partially offset by costs of $9.3 million related
      to skill set realignments and increased fuel expense.




Strategic
      Energy’s net income decreased $23.7 million for the three months ended
      March 31, 2006, compared to the same period in 2005 primarily due to the
      impact of $35.9 million in
      changes in fair value related to non-hedging energy contracts and from cash
      flow
      hedge ineffectiveness.




Higher
      reductions in affordable housing investments and lower related tax credits
      decreased other non-regulated operations net income for the three months ended
      March 31, 2006, compared to the same period in 2005 by $2.3 million.


47


**CONSOLIDATED
      KCP&L RESULTS OF OPERATIONS**




The
      following discussion of consolidated KCP&L results of operations includes
      KCP&L, an integrated, regulated electric utility and HSS, an unregulated
      subsidiary of KCP&L. References to KCP&L, in the discussion that
      follows, reflect only the operations of the utility. The following table summarizes
      consolidated KCP&L's comparative results of operations.


**Three
                    Months Ended March 31**
                **2006**
                
                **2005**(millions)Operating
                    revenues
                $
                240.4
                
                $
                233.3Fuel
                
                (47.4
                )
                
                (41.5
                )Purchased
                    power
                
                (5.1
                )
                
                (11.5
                )Other
                    operating expenses
                
                (111.4
                )
                
                (119.8
                )Skill
                    set realignment costs
                
                (9.3
                )
                
                -Depreciation
                    and amortization
                
                (37.0
                )
                
                (36.4
                )Gain
                    (loss) on property
                
                (0.1
                )
                
                0.5Operating income
                
                30.1
                
                
                24.6Non-operating
                    income (expenses)
                
                0.7
                
                
                0.3Interest
                    charges
                
                (14.9
                )
                
                (14.6
                )Income
                    taxes
                
                (3.9
                )
                
                (0.9
                )Minority
                    interest in subsidiaries
                
                -
                
                
                0.9Net income
                $
                12.0
                
                $
                10.3


**Consolidated
      KCP&L Sales Revenues and MWh Sales**


**%****Three
                      Months Ended March 31**
                  **2006**
                  
                  **2005**
                  
                  **Change**Retail
                      revenues
                  (millions)Residential
                  $
                  72.3
                  
                  $
                  73.2
                  
                  
                  (1
                  )Commercial
                  
                  92.5
                  
                  
                  91.3
                  
                  
                  1Industrial
                  
                  22.2
                  
                  
                  22.8
                  
                  
                  (2
                  )Other retail revenues
                  
                  2.2
                  
                  
                  2.2
                  
                  
                  3Total retail
                  
                  189.2
                  
                  
                  189.5
                  
                  
                  -Wholesale
                      revenues
                  
                  47.5
                  
                  
                  39.1
                  
                  
                  22Other
                      revenues
                  
                  3.7
                  
                  
                  4.6
                  
                  
                  (23
                  )KCP&L electric revenues
                  
                  240.4
                  
                  
                  233.2
                  
                  
                  3Subsidiary
                      revenues
                  
                  -
                  
                  
                  0.1
                  
                  
                  (100
                  )Consolidated KCP&L revenues
                  $
                  240.4
                  
                  $
                  233.3
                  
                  
                  3
 **%****Three
                    Months Ended March 31**
                **2006**
                
                **2005**
                
                **Change**Retail
                    MWh sales
                (thousands)Residential
                
                1,158
                
                
                1,180
                
                
                (2
                )Commercial
                
                1,702
                
                
                1,678
                
                
                1Industrial
                
                509
                
                
                510
                
                
                -Other retail MWh sales
                
                22
                
                
                21
                
                
                4Total retail
                
                3,391
                
                
                3,389
                
                
                -Wholesale
                    MWh sales
                
                1,104
                
                
                1,210
                
                
                (9
                )KCP&L electric MWh sales
                
                4,495
                
                
                4,599
                
                
                (2
                )


Retail
      revenues were relatively unchanged for the three months ended March 31, 2006,
      compared to the same period in 2005. Mild weather was mostly offset by growth
      in
      the number of customers and


48


usage
      per
      customer. Wholesale revenues increased $8.4 million for
      the
      three months ended March 31, 2006, compared to the same period in 2005 due
      to an
      increase in the average market price per MWh, which was partially offset by
      a 9%
      decrease in MWhs sold. Average market price per MWh increased 45% to $50.45 due
      to
      higher natural gas prices and coal conservation in the region. The decrease
      in
      MWhs sold was driven by a 1% decrease in
      net
      MWhs generated as a result of coal conservation and fewer purchases due to
      uneconomical purchased power prices.




**Consolidated
      KCP&L Fuel and Purchased Power**


**%****Three
                    Months Ended March 31**
                **2006**
                **2005**
                **Change**Net
                    MWhs Generated by Fuel Type
                (thousands)Coal
                
                3,407
                
                
                3,603
                
                
                (5
                )Nuclear
                
                1,210
                
                
                1,043
                
                
                16Natural
                    gas and oil
                
                1
                
                
                (2
                )
                
                (136
                )Total Generation
                
                4,618
                
                
                4,644
                
                
                (1
                )


Fuel
      expense increased $5.9 million for
      the
      three months ended March 31, 2006, compared to the same period in 2005 despite
      a
      1% decrease in MWhs generated primarily due to increased coal and coal
      transportation costs. KCP&L’s current coal and coal transportation
      contracts, including higher tariff rates being charged by Union Pacific, were
      entered into at higher average prices than related contracts in the same period
      of 2005. KCP&L has filed a rate case complaint against Union Pacific with
      the STB and until the case is finalized, KCP&L is paying the tariff rates
      subject to refund. See Note 14 to
      the
      consolidated financial statements for
      more
      information.




Purchased
      power expense decreased $6.4 million for the
      three months ended March 31, 2006, compared to the same period in 2005 primarily
      due to a 51% reduction
      in MWhs purchased and a $3.6 million decrease
      in capacity payments due to the expiration of two large contracts in the second
      quarter of 2005. These reductions were slightly offset by a 20% increase
      in the average price per MWh. The reduction in MWhs purchased was due to
      uneconomical purchased power prices. The increased prices were driven by higher
      natural gas prices and coal conservation in the region.




In
      August
      2005, Hawthorn No. 5’s generator step-up transformer (GSU) failed. A spare GSU
      was installed in September; however, the size of the spare GSU limits the output
      of the unit to net 500 MW. The 65 MW decrease in Hawthorn No. 5 capability
      will
      continue until a new transformer is installed. KCP&L originally expected
      this to occur in June 2006; however, the manufacturer recently notified
      KCP&L the production and subsequent delivery of the transformer will be
      delayed. A final delivery date has not been confirmed, but the timing may still
      enable the transformer to be installed in June 2006. If the transformer cannot
      be delivered in time for a June 2006 installation, management may delay the
      installation until after the summer peaking season. The outage to install the
      repaired GSU is expected to be completed in 14 days.




**Consolidated
      KCP&L Other Operating Expenses** ***(including
      other operating, maintenance and general taxes)***


Consolidated
      KCP&L's other operating expenses decreased $8.4 million for
      the
      three months ended March 31, 2006, compared to the same period of 2005,
      primarily due to the following:




·
            decreased
                pension expense of $2.8 milliondue to the regulatory accounting treatment of pension expense in
                accordance with MPSC and KCC orders, which was first recorded in
                the third
                quarter of 2005,




·
            decreased
                expenses of $4.5 milliondue
                to restoration costs for a January 2005 ice storm
                and


49


·
            decreased
                production maintenance expenses of $2.8 millionprimarily
                due to more significant scheduled plant maintenance in 2005.




Partially
      offsetting the decrease in other operating expenses was:




·
            increased
                property tax expenses of $1.2 milliondue
                to higher assessed values and tax
                levies.




**Consolidated
      KCP&L Skill Set Realignment Costs**


Over
      the
      past several months, management undertook a process to assess, improve and
      reposition the skill sets of KCP&L’s employees for implementation of the
      comprehensive energy plan. For the three months ended March 31, 2006, KCP&L
      recorded $9.3 million related to this workforce realignment process reflecting
      severance, benefits and related payroll taxes provided by KCP&L to
      employees. Management anticipates the need to fill positions with the specific
      skill sets and talent needed to achieve KCP&L’s goals. Management believes
      that the realignment allows for optimization of employee levels and avoids
      future additional expense. Additionally, estimated pension settlement costs
      of
      approximately $7.8 million associated with the realignment will be recorded in the second quarter of 2006.
      The pension settlement costs are a result of the number of employees retiring
      and selecting the lump-sum payment option. The final pension settlement costs
      will be determined at the end of the plan year in the fourth quarter of
      2006.




**Potential
      Future Pension Settlement Costs**


Through
      2010 ,
      approximately 26% of KCP&L’s current employees are eligible to retire with
      full pension benefits. The timing and number of employees retiring and selecting
      the lump sum payment option could result in additional settlement charges that
      could materially affect KCP&L’s results of operations for 2006 and
      beyond.




**Strategic
      Energy Results of Operations**




The
      following table summarizes
      Strategic Energy's comparative results of operations.


**Three
                    Months Ended March 31**
                **2006**
                
                **2005**(millions)Operating
                    revenues
                $
                318.8
                
                $
                311.8Purchased
                    power
                
                (325.8
                )
                
                (277.9
                )Other
                    operating expenses
                
                (12.5
                )
                
                (10.7
                )Depreciation
                    and amortization
                
                (1.9
                )
                
                (1.5
                )Operating income (loss)
                
                (21.4
                )
                
                21.7Non-operating
                    income (expenses)
                
                0.9
                
                
                0.4Interest
                    charges
                
                (0.3
                )
                
                (0.8
                )Income
                    taxes
                
                9.9
                
                
                (8.5
                )Net income (loss)
                $
                (10.9
                )
                $
                12.8
 50


Retail
      MWhs delivered decreased 21% to 3.7 million for
      the
      three months ended March 31, 2006, compared to the same period in 2005 due
      to the effect of market conditions in midwestern states and competition in
      other
      markets where Strategic Energy serves customers. The average retail gross margin
      per MWh declined to $(2.12) for the
      three months ended March 31, 2006, compared to $7.16 for the
      same period in 2005 primarily due to the impact of $35.9 million in
      changes in fair value related to non-hedging energy contracts and from cash
      flow
      hedge ineffectiveness.


**Three
                  Months Ended March 31**
              **2006**
              
              **2005**Average
                  retail gross margin per MWh
              $
              (2.12
              )
              $
              7.16Change
                  in fair value related to non-hedging energycontracts
                  and from cash flow hedge ineffectiveness
              
              9.79
              
              
              (1.08
              )Average
                  retail gross margin per MWh withoutfair
                  value impacts
              $
              7.67
              
              $
              6.08


Average
      retail gross margin per MWh without fair value impacts is a non-GAAP financial
      measure that differs from GAAP because it excludes the impact of unrealized
      fair
      value gains or losses. Management and the Board of Directors use this as a
      measurement of Strategic Energy’s realized retail gross margin per delivered
      MWh, which are settled upon delivery at contracted prices. Fair value impacts
      result from changes in fair value of non-hedging energy contracts and from
      hedge
      ineffectiveness associated with MWhs under contract but not yet delivered.
      Due
      to their non-cash nature and volatility during periods prior to delivery,
      management believes excluding these fair value impacts results in a measure
      of
      retail gross margin per MWh that is more representative of contracted
      prices.




As
      detailed in the table above, average retail gross margin per MWh without the
      impact of unrealized fair value gains and losses increased to $7.67 for the
      three months ended March 31, 2006, compared to $6.08 for the same period in
      2005. The increase was primarily due to the management of retail portfolio
      load
      requirements, favorable product mix and $1.9 million received
      in settlement of a supplier contract partially offset by $2.3 million in
      2006
      SECA charges in excess of recoveries, $2.2 million in
      billing credits resulting from its power supply coordination efforts and a
      $1.2
      million reduction
      of a gross receipts tax contingency in 2005.




**Strategic
      Energy Purchased Power**


Purchased
      power is the cost component of Strategic Energy’s average retail gross margin.
      Strategic Energy purchases blocks of electricity from power suppliers based
      on
      forecasted peak demand for its retail customers. Actual customer demand does
      not
      always equate to the volume included in blocks of purchased power. Consequently,
      Strategic Energy sells any excess retail electricity supply over actual customer
      requirements back into the wholesale market. These sales occur on many
      contracts, are usually short-term power sales (day ahead) and typically settle
      within the reporting period. Excess retail electricity supply sales also include
      long-term forward physical sales to wholesale counterparties, which are
      accounted for on a mark-to-market basis. Strategic Energy typically executes
      these transactions to manage basis and credit risks. The proceeds from excess
      retail supply sales are recorded as a reduction of purchased power, as they
      do
      not represent the quantity of electricity consumed by Strategic Energy’s
      customers. The amount of excess retail supply sales that reduced purchased
      power
      was $51.4 million and $24.2 million for the
      three months ended March 31, 2006 and 2005, respectively. Additionally, in
      certain markets, load-serving entities are required to sell to and purchase
      power from a RTO/ISO rather than directly transact with suppliers and end use
      customers. The sale and purchase activity related to these certain RTO/ISO
      markets is reflected on a net basis in Strategic Energy’s purchased power.


51


Strategic
      Energy utilizes derivative instruments, including forward physical delivery
      contracts, in the procurement of electricity. Purchased power is also impacted
      by the net change in fair value related to non-hedging energy contracts and
      from
      cash flow hedge ineffectiveness. Net changes in fair value increased purchased
      power expenses by $35.9 million for the
      three months ended March 31, 2006, compared to a reduction of $5.0
      million for the
      same period in 2005. See Note 16 to the consolidated financial statements for
      more information.




**OTHER
      NON-REGULATED ACTIVITIES**




**Investment
      in Affordable Housing Limited Partnerships - KLT
      Investments**


KLT
      Investments Inc.’s (KLT Investments) net income for the three months ended March
      31, 2006, totaled $0.7 million (including an after-tax reduction of $0.7 million in
      its
      affordable housing investment) compared to net income of $3.0 million for
      the
      three months ended March 31, 2005. KLT Investments accrued tax credits related
      to its investments in affordable housing limited partnerships of $2.3
      million and $3.9
      million for
      the
      three months ended March 31, 2006 and 2005, respectively.




At
      March
      31, 2006, KLT Investments had $26.3 million in
      affordable housing limited partnerships. Approximately 59% of these
      investments were recorded at cost; the equity method was used for the remainder.
      Tax expense is reduced in the year tax credits are generated. The investments
      generate future cash flows from tax credits and tax losses of the partnerships.
      The investments also generate cash flows from the sales of the properties.
      For
      most investments, tax credits are received over ten years. A change in
      accounting principle relating to investments made after May 19, 1995,
      requires the use of the equity method when a company owns more than 5% in a
      limited partnership investment. Of the investments recorded at cost, $15.1
      million exceed
      this 5% level but were made before May 19, 1995. Management does not
      anticipate making additional investments in affordable housing limited
      partnerships at this time.




On
      a
      quarterly basis, KLT Investments compares the cost of properties accounted
      for
      by the cost method to the total of projected residual value of the properties
      and remaining tax credits to be received. Based on the latest comparison, KLT
      Investments reduced its investments in affordable housing limited partnerships
      by $1.1 million for the
      three months ended March 31, 2006, compared to an insignificant reduction in
      2005. Pre-tax reductions in affordable housing investments are estimated to
      be
      insignificant for the remainder of 2006 and $2 million for 2007.
      These projections are based on the latest information available but the ultimate
      amount and timing of actual reductions could be significantly different from
      the
      above estimates. The properties underlying the partnership investment are
      subject to certain risks inherent in real estate ownership and management.
      Even
      after these estimated reductions, net income from the investments in affordable
      housing is expected to be positive for 2006 through 2008 .




**GREAT
      PLAINS ENERGY AND CONSOLIDATED KCP&L****SIGNIFICANT BALANCE
      SHEET CHANGES****(March 31, 2006 compared to December 31,
      2005)**




·
            Great
                Plains Energy’s and consolidated KCP&L’s fuel inventories increased
                $4.1 million primarily due to a scheduled plant outage and increased
                coal
                and coal transportation costs.




·
            Great
                Plains Energy’s combined deferred income taxes - current assets and
                deferred income taxes - current liabilities changed from a liability
                of
                $1.3 million at December 31, 2005, to an asset of $19.8 million.
                The
                change in the fair value of Strategic Energy’s energy-related derivative
                instruments increased the asset $19.6 million.




·
            Great
                Plains Energy’s derivative instruments, including current and deferred
                assets and liabilities, decreased $71.8million primarily due to a $74.6 milliondecrease in the fair value of Strategic Energy’s energy-related derivative
                instruments as a result of decreases in the forward


52


market prices for power compounded by increased contract volume.
              Consolidated KCP&L’s derivative instruments, including current and
              deferred assets and liabilities, increased $2.8 million to reflect
              the
              $3.8 million change in the fair value of a Forward Starting Swap and
              a
              decrease in the fair value of EIRR swaps and commodity
              derivatives.  ·
            Great
                Plains Energy’s and consolidated KCP&L’s total net utility plant
                increased $37.4 million primarily due to a $13.8 million purchase of
                automated meter reading equipment, $6.9 million net increase in nuclear
                fuel in process for the fall 2006 refueling outage, $11.6 million
                related
                to KCP&L’s comprehensive energy plan and $7.6 million to upgrade a
                transmission line.




·
            Great
                Plains Energy’s and consolidated KCP&L’s commercial paper increased
                $41.9 million primarily to support expenditures related to the
                comprehensive energy plan and due to the timing of cash
                payments.




·
            Great
                Plains Energy’s accounts payable decreased $26.1 million primarily due to
                a $17.6 milliondecrease in Strategic Energy’s accounts payable due to lower market prices
                for power and the timing of cash payments. Consolidated KCP&L’s
                accounts payable decreased $13.0 million primarily due to timing
                of cash
                payments.




·
            Great
                Plains Energy’s and consolidated KCP&L’s accrued taxes increased $4.5
                million and $11.8 million, respectively, primarily due to the timing
                of
                tax payments.




·
            Great
                Plains Energy’s accrued payroll and vacations decreased $5.0 million
                primarily due to Strategic Energy’s 2006 payout of employee incentive
                compensation accrued at December 31, 2005. Consolidated KCP&L’s
                accrued payroll and vacations increased $0.6 million primarily due
                to the
                accrual of $8.1 million for skill set realignment costs mostly offset
                by
                the 2006 payout of employee incentive compensation accrued at December
                31,
                2005.




·
            Great
                Plains Energy’s accumulated other comprehensive loss increased $18.2
                million primarily due to the decrease in the fair value of Strategic
                Energy’s energy related derivative instruments mostly due to decreases in
                the forward market prices for power compounded by increased contract
                volume.




·
            Great
                Plains Energy’s long-term debt decreased $389.1 million to reflect
                FELINE PRIDES Senior Notes and consolidated KCP&L’s $225.0 million
                6.00% Senior Notes as current maturities. Current maturities of long-term
                debt for the respective companies increased as a result of these
                classifications.




**CAPITAL
      REQUIREMENTS AND LIQUIDITY**




Great
      Plains Energy operates through its subsidiaries and has no material assets
      other
      than the stock of its subsidiaries. Great Plains Energy’s ability to make
      payments on its debt securities and its ability to pay dividends is dependent
      on
      its receipt of dividends or other distributions from its subsidiaries and
      proceeds from the issuance of its securities.




Great
      Plains Energy’s capital requirements are principally comprised of KCP&L’s
      utility construction and other capital expenditures, debt maturities and credit
      support provided to Strategic Energy. These items as well as additional cash
      and
      capital requirements for the companies are discussed below.




Great
      Plains Energy's liquid resources at March 31, 2006, consisted of $87.6 million of
      cash
      and cash equivalents on hand, including $2.7 million at
      consolidated KCP&L, and $752.1 million of
      unused
      bank lines of credit. The unused lines consisted
      of $176.2 million from KCP&L's revolving credit facility, $72.9 million from
      Strategic Energy’s revolving credit facility and $503.0 million from Great
      Plains


53


Energy's
      revolving credit facility. See the Debt Agreements section below for more
      information on these agreements.




KCP&L
      expects to meet day-to-day cash flow requirements including interest payments,
      construction requirements (excluding its comprehensive energy plan), dividends
      to Great Plains Energy and pension benefit plan funding requirements, discussed
      below, with internally generated funds. KCP&L might not be able to meet
      these requirements with internally generated funds because of the effect of
      inflation on operating expenses, the level of MWh sales, regulatory actions,
      compliance with future environmental regulations and the availability of
      generating units. The funds Great Plains Energy and consolidated KCP&L need
      to retire maturing debt will be provided from operations, the issuance of long
      and short-term debt and/or the issuance of equity or equity-linked instruments.
      In addition, the Company may issue debt, equity and/or equity-linked instruments
      to finance growth or take advantage of new opportunities.




KCP&L
      currently expects to fund its comprehensive energy plan from a combination
      of
      internal and external sources including, but not limited to, contributions
      from
      rate increases, capital contributions to KCP&L from Great Plains Energy's
      proceeds of new equity financing and 2004 FELINE PRIDES equity in 2007, new
      short and long-term debt financing and internally generated funds.




Strategic
      Energy expects to meet day-to-day cash flow requirements including interest
      payments, credit support fees, capital expenditures and dividends to its
      indirect interest holders with internally generated funds. Strategic Energy
      might not be able to meet these requirements with internally generated funds
      because of the effect of inflation on operating expenses, the level of MWh
      sales, seasonal working capital requirements, commodity-price volatility and
      the
      effects of counterparty non-performance.




**Cash
      Flows from Operating Activities**


Great
      Plains Energy generated positive cash flows from operating activities for the
      periods presented. The increase in cash flows from operating activities for
      Great Plains Energy and consolidated KCP&L for the three months ended March
      31, 2006, compared to the same period in 2005 was primarily due to KCP&L’s
      $65.0 million change
      in
      cash flows from accounts receivable as a result of the January 2005 termination
      of KCP&L’s previous customer accounts receivables sales agreement.




**Cash
      Flows from Investing Activities**


Great
      Plains Energy’s and consolidated KCP&L’s cash used for investing activities
      varies with the timing of utility capital expenditures and purchases of
      investments and nonutility property. Investing activities are offset by the
      proceeds from the sale of properties and insurance recoveries. Great Plains
      Energy’s and consolidated KCP&L’s cash utility capital expenditures
      increased $41.6 million for
      the
      three months ended March 31, 2006, compared to the same period in 2005, which
      includes $12.9 million to purchase automated meter reading equipment, $7.5
      million to
      support KCP&L’s comprehensive energy plan and $5.4 million to
      upgrade a transmission line. In 2005 ,
      KCP&L received $10.0 million of insurance recoveries related to Hawthorn No.
      5.




**Cash
      Flows from Financing Activities**


The
      change in Great Plains Energy’s and consolidated KCP&L’s cash flows from
      financing activities for the three months ended March 31, 2006, compared to
      the
      same period in 2005, reflects increased short-term borrowing activity to support
      KCP&L’s comprehensive energy plan. Additionally, consolidated KCP&L’s
      financing activities reflect lower dividends to Great Plains Energy.




**Significant
      Financing Activities**


KCP&L’s
      long-term financing activities are subject to the authorization of the MPSC.
      In
      November 2005, the MPSC authorized KCP&L to issue up to $635.0 million of
      long-term debt and to enter into interest rate hedging instruments in connection
      with such debt through December 31, 2009. Under


54


stipulations
      with the MPSC and KCC, Great Plains Energy and KCP&L maintain common equity
      at not less than 30% and 35%, respectively, of total capitalization.




In
      February 2006, FERC authorized KCP&L to issue up to $300.0 million in
      outstanding short-term debt instruments through February 2008. The authorization
      is subject to four restrictions: (i) proceeds of debt backed by utility assets
      must be used for utility purposes; (ii) if any utility assets that secure
      authorized debt are divested or spun off, the debt must follow the assets and
      also be divested or spun off; (iii) if any proceeds of the authorized debt
      are
      used for non-utility purposes, the debt must follow the non-utility assets
      (specifically, if the non-utility assets are divested or spun off, then a
      proportionate share of the debt must follow the divested or spun off non-utility
      assets); and (iv) if utility assets financed by the authorized short-term debt
      are divested or spun off to another entity, a proportionate share of the debt
      must also be divested or spun off. In the second quarter of 2006, KCP&L
      filed an application with FERC to increase the authorization to $600.0 million
      consistent with the funding level potentially available to KCP&L under the
      terms of its renegotiated credit facility as described in the next section.




During
      the first quarter of 2006, KCP&L entered into two Forward Starting Swaps
      with a combined notional principal amount of $225.0 million to
      effectively remove most of the interest rate and credit spread uncertainty
      with
      respect to the anticipated refinancing of KCP&L’s $225.0 million senior
      notes that mature in March 2007. See Note 16 to the consolidated financial
      statements.




Great
      Plains Energy intends to file a shelf registration statement in the second
      quarter of 2006 for an indeterminate amount or number of Senior Debt Securities,
      Subordinated Debt Securities, shares of Common Stock, Stock Purchase Contracts
      and Stock Purchase Units or Warrants to be offered at indeterminate prices.




During
      2005, KCP&L completed a private placement of $250.0 million of
      6.05%
      unsecured senior notes, maturing in 2035. Pursuant to its obligations under
      a
      registration rights agreement entered into in connection with the private
      placement, KCP&L commenced an exchange offer in the second quarter of 2006
      to exchange registered 6.05% unsecured senior notes for the $250.0 million
      privately placed notes. Management expects the exchange offer to be completed
      in
      May 2006. The registered notes will carry the same terms and conditions as
      the
      privately placed issue without, except in limited circumstances, transfer
      restrictions and payment of additional interest provisions.




**Debt
      Agreements**


Great
      Plains Energy has a $550 million revolving credit facility with a group of
      banks
      that expires in December 2009. The facility contains a Material Adverse Change
      (MAC) clause that requires Great Plains Energy to represent, prior to receiving
      funding, that no MAC has occurred. The clause does, however, permit the Company
      to access the facility even in the event of a MAC in order to repay maturing
      commercial paper. Available liquidity under this facility is not impacted by
      a
      decline in credit ratings unless the downgrade results in a MAC or occurs in
      the
      context of a merger, consolidation or sale. A default by Great Plains Energy
      or
      any of its significant subsidiaries of other indebtedness totaling more than
      $25.0 million is a default under the facility. Under the terms of this
      agreement, Great Plains Energy is required to maintain a consolidated
      indebtedness to consolidated capitalization ratio, as defined in the agreement,
      not greater than 0.65 to 1.00 at all times. At March 31, 2006, the Company
      was
      in compliance with this covenant. At March 31, 2006, Great Plains Energy had
      issued letters of credit totaling $47.0 million under
      the
      credit facility as credit support for Strategic Energy.




KCP&L
      has a $250 million revolving credit facility with a group of banks that expires
      in December 2009 to provide support for its issuance of commercial paper and
      other general purposes. The facility contains a MAC clause that requires
      KCP&L to represent, prior to receiving funding, that no MAC has occurred.
      The clause does, however, permit KCP&L to access the facility even in the
      event of a MAC


55


in
      order
      to repay maturing commercial paper. Available liquidity under this facility
      is
      not impacted by a decline in credit ratings unless the downgrade results in
      a
      MAC or occurs in the context of a merger, consolidation or sale. A default
      by
      KCP&L on other indebtedness totaling more than $25.0 million is a default
      under the facility. Under the terms of the agreement, KCP&L is required to
      maintain a consolidated indebtedness to consolidated capitalization ratio,
      as
      defined in the agreement, not greater than 0.65 to 1.00 at all times. At
      March 31, 2006, KCP&L was in compliance with this covenant. At
      March 31, 2006, KCP&L had $73.8 million of
      commercial paper outstanding and no cash borrowings under the facility. The
      weighted-average interest rate of the commercial paper was 4.95%.




The
      Great
      Plains Energy and KCP&L revolving credit facilities are currently being
      amended and management expects these transactions to close during the second
      quarter of 2006. The new facilities are expected to have a five-year term and
      total $1.0 billion with the Great Plains Energy and KCP&L facilities
      initially sized at $600 million and $400 million, respectively. Of the $600
      million of revolving credit initially available to Great Plains Energy, up
      to
      $200 million of this capacity may be allocated to either Great Plains Energy
      or
      KCP&L over the five-year term of the credit facilities as
      needed.




Strategic
      Energy has a $135 million revolving credit facility with a group of banks that
      expires in June 2009. So long as there is no default or unmatured default,
      Strategic Energy may increase this amount by up to $15 million by increasing
      the
      commitment of one or more lenders that have agreed to such increase, or by
      adding one or more lenders with the consent of the administrative agent. Great
      Plains Energy has currently guaranteed $25.0 million of this facility. The
      facility contains a MAC clause that requires Strategic Energy to represent,
      prior to receiving funding, that no MAC has occurred. A default by Strategic
      Energy of other indebtedness, as defined in the facility, totaling more than
      $7.5 million is a default under the facility. Under the terms of this amended
      agreement, Strategic Energy is required to maintain a minimum net worth of
      $75.0
      million, a minimum fixed charge coverage ratio of at least 1.05 to 1.00 and
      a
      minimum debt service coverage ratio of at least 4.00 to 1.00, as those terms
      are
      defined in the agreement. In addition, under the terms of this amended
      agreement, Strategic Energy is required to maintain a maximum funded
      indebtedness to EBITDA ratio, as defined in the agreement, of 3.00 to 1.00,
      on a
      quarterly basis through June 30, 2007, and 2.75 to 1.00 thereafter. In the
      event of a breach of one or more of these four covenants, so long as no other
      default has occurred, Great Plains Energy may cure the breach through a cash
      infusion, a guarantee increase or a combination of the two. At March 31,
      2006, Strategic Energy was in compliance with these covenants. At March 31,
      2006, $62.1 million in
      letters of credit had been issued and there were no cash borrowings under the
      agreement.




Great
      Plains Energy has agreements with KLT Investments associated with notes KLT
      Investments issued to acquire its affordable housing investments. Great Plains
      Energy has agreed not to take certain actions including, but not limited to,
      merging, dissolving or causing the dissolution of KLT Investments, or
      withdrawing amounts from KLT Investments if the withdrawals would result in
      KLT
      Investments not being in compliance with minimum net worth and cash balance
      requirements. The agreements also give KLT Investments’ lenders the right to
      have KLT Investments repurchase the notes if Great Plains Energy’s senior debt
      rating falls below investment grade or if Great Plains Energy ceases to own
      at
      least 80% of KCP&L’s stock. At March 31, 2006, KLT Investments had
      $2.6 million in
      outstanding notes, including current maturities.




**KCP&L
      Projected Utility Capital Expenditures**


KCP&L's
      utility capital expenditure plan is subject to continual review and change
      and
      includes utility capital expenditures related to KCP&L's comprehensive
      energy plan for environmental investments and new capacity. Based on the latest
      information available, management believes approximately $85 million originally
      estimated to be expended in 2009 related to Iatan No. 2 will be expended in
      2007, raising the Iatan No. 2 2007 expenditures reported in the companies’ 2005
      Form 10-K from $120.4 million to approximately $205 million. Although
      contracting is not complete, developing market


56


conditions
      indicate a potential increase in the overall cost estimates of the comprehensive
      energy plan in the range of 10% to 20%. The primary drivers are increases in
      materials and labor costs and some scope additions. Management anticipates
      completion of its definitive estimates by August. The definitive estimates
      could
      be materially different than the current estimates; however, management is
      confident that project costs will be competitive with other similar
      projects.




**Pensions**


The
      Company maintains defined benefit plans for substantially all employees of
      KCP&L, Services and WCNOC and incurs significant costs in providing the
      plans, with the majority incurred by KCP&L. At a minimum, plans are funded
      on an actuarial basis to provide assets sufficient to meet benefits to be paid
      to plan participants consistent with the funding requirements of the Employee
      Retirement Income Security Act of 1974 (ERISA) and further contributions may
      be
      made when deemed financially advantageous.




During
      the first quarter, KCP&L contributed $1.9 million to the plans. For the
      remainder of 2006, the Company expects to contribute $17.9 million to the plans,
      all of which will be paid by KCP&L. Management believes the Company has
      adequate access to capital resources through cash flows from operations or
      through existing lines of credit to support the funding requirements.




Participants
      in the plans may request a lump-sum cash payment upon termination of their
      employment. A change in payment assumptions could result in increased cash
      requirements from pension plan assets with the Company being required to
      accelerate future funding. Under the terms of the pension plans, the Company
      reserves the right to amend or terminate the plans, and from time to time
      benefits have changed.




Legislative
      changes have been proposed that would alter the manner in which pension plan
      assets and liabilities are valued for purposes of calculating required pension
      contributions and change the timing and manner in which required contributions
      to underfunded plans are made. If these proposals are adopted, the funding
      requirements could be significantly affected.




**Strategic
      Energy Supplier Concentration and Credit**


Strategic
      Energy enters into forward physical contracts with multiple suppliers. At March
      31, 2006, Strategic
      Energy’s five largest suppliers under forward supply contracts represented
      74 %
      of the
      total future dollar committed purchases. Four of
      Strategic Energy’s five largest suppliers, or their guarantors, are rated
      investment grade; and the non-investment grade rated supplier collateralizes
      its
      position with Strategic Energy. In the event of supplier non-delivery or
      default, Strategic Energy’s results of operations could be affected to the
      extent the cost of replacement power exceeded the combination of the contracted
      price with the supplier and the amount of collateral held by Strategic Energy
      to
      mitigate its credit risk with the supplier. In addition to the collateral,
      if
      any, that the supplier provides, Strategic Energy’s risk may be further
      mitigated by the obligation of the supplier to make a default payment equal
      to
      the shortfall and to pay liquidated damages in the event of a failure to deliver
      power. There is no assurance that the supplier in such an instance would make
      the default payment and/or pay liquidated damages. Strategic Energy’s results of
      operations and financial position could also be affected, in a given period,
      if
      it were required to make a payment upon termination of a supplier contract
      to
      the extent the contracted price with the supplier exceeded the market value
      of
      the contract at the time of termination.


57


The
      following tables provide
      information on Strategic Energy’s credit exposure to suppliers, net of
      collateral, at March 31, 2006.


**Number
                    Of**
                
                **Net
                    Exposure Of****Counterparties**
                
                **Counterparties****Exposure**
                
                
                
                
                
                **Greater
                    Than**
                
                **Greater
                    Than****Before
                    Credit**
                
                **Credit**
                
                **Net**
                
                **10%
                    Of Net**
                
                **10%
                    of Net****Rating**
                **Collateral**
                
                **Collateral**
                
                **Exposure**
                
                **Exposure**
                
                **Exposure**External
                    rating
                (millions)
                
                
                (millions)Investment Grade
                $
                76.5
                
                
                $
                -
                
                $
                76.5
                
                
                2
                
                $
                57.4Non-Investment Grade
                
                19.2
                
                
                
                17.0
                
                
                2.2
                
                
                -
                
                
                -Internal
                    ratingInvestment Grade
                
                0.5
                
                
                
                -
                
                
                0.5
                
                
                -
                
                
                -Non-Investment Grade
                
                0.5
                
                
                
                0.3
                
                
                0.2
                
                
                -
                
                
                -Total
                $
                96.7
                
                
                $
                17.3
                
                $
                79.4
                
                
                2
                
                $
                57.4
 **Maturity
                    Of Credit Risk Exposure Before Credit
                    Collateral****Less
                    Than**
                
                
                
                **Total****Rating**
                **2
                    Years**
                
                **2
                    - 5 Years**
                
                **Exposure**External
                    rating
                (millions)Investment Grade
                $
                74.7
                
                $
                1.8
                
                $
                76.5Non-Investment Grade
                
                14.5
                
                
                4.7
                
                
                19.2Internal
                    ratingInvestment Grade
                
                0.5
                
                
                -
                
                
                0.5Non-Investment Grade
                
                (0.9
                )
                
                1.4
                
                
                0.5Total
                $
                88.8
                
                $
                7.9
                
                $
                96.7


External
      ratings are determined by using publicly available credit ratings of the
      counterparty. If a counterparty has provided a guarantee by a higher rated
      entity, the determination has been based on the rating of its guarantor.
      Internal ratings are determined by, among other things, an analysis of the
      counterparty’s financial statements and consideration of publicly available
      credit ratings of the counterparty’s parent. Investment grade counterparties are
      those with a minimum senior unsecured debt rating of BBB- from Standard &
Poor’s or Baa3 from Moody’s Investors Service. Exposure before credit collateral
      has been calculated considering all netting agreements in place, netting
      accounts payable and receivable exposure with net mark-to-market exposure.
      Exposure before credit collateral, after consideration of all netting
      agreements, is impacted significantly by the power supply volume under contract
      with a given counterparty and the relationship between current market prices
      and
      contracted power supply prices. Credit collateral includes the amount of cash
      deposits and letters of credit received from counterparties. Net exposure has
      only been calculated for those counterparties to which Strategic Energy is
      exposed and excludes counterparties exposed to Strategic Energy.




In
      December 2005, Calpine Energy Services filed a motion in bankruptcy court
      seeking to reject a power sales agreement with Strategic Energy. In the second
      quarter of 2006, Strategic Energy terminated its agreement with Calpine Energy
      Services, which is not expected to materially affect results of
      operations.




Strategic
      Energy’s total exposure before credit collateral at March 31, 2006, decreased
      $158.6 million
      from December 31, 2005, primarily due to lower wholesale electricity prices.
      At
      March 31, 2006, Strategic Energy had exposure before collateral to
      non-investment grade counterparties totaling $19.7 million,
      of which 69 %
      is
      scheduled to mature in less than two years. In addition, Strategic Energy held


58


collateral
      totaling $17.3 million
      limiting its exposure to these non-investment grade counterparties to
      $2.4 million.




Strategic
      Energy contracts with national and regional counterparties that have direct
      supplies and assets in the region of demand. Strategic Energy also manages
      its
      counterparty portfolio through disciplined margining, collateral requirements
      and contract-based netting of credit exposures against payable
      balances.




**Supplemental
      Capital Requirements and Liquidity Information**


Great
      Plains Energy’s and consolidated KCP&L’s contractual obligations have not
      significantly changed outside of the ordinary course of business at March 31,
      2006 ,
      compared to December 31, 2005.




**Off-Balance
      Sheet Arrangements**


In
      the
      normal course of business, Great Plains Energy and certain of its subsidiaries
      enter into various agreements providing financial or performance assurance
      to
      third parties on behalf of certain subsidiaries. Such agreements include, for
      example, guarantees, stand-by letters of credit and surety bonds. These
      agreements are entered into primarily to support or enhance the creditworthiness
      otherwise attributed to a subsidiary on a stand-alone basis, thereby
      facilitating the extension of sufficient credit to accomplish the subsidiaries’
intended business purposes. Great Plains Energy’s guarantees provided on behalf
      of Strategic Energy for its power purchases and regulatory requirements
      increased $28.4 million to $150.4 million
      at March 31, 2006, compared to $122.0 million
      at December 31, 2005. This represents a $19.9 million
      increase of direct guarantees to counterparties and an $8.5 million
      increase of letters of credit primarily due to using more of Great Plains
      Energy’s credit support, which is more economical. Consolidated KCP&L’s
      guarantees of $3.9 million
      at March 31, 2006, were unchanged from December 31, 2005.




**ITEM
      3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET
      RISK**




Great
      Plains Energy and consolidated KCP&L are exposed to market risks associated
      with commodity price and supply, interest rates and equity prices. Market risks
      are handled in accordance with established policies, which may include entering
      into various derivative transactions. In the normal course of business, Great
      Plains Energy and consolidated KCP&L also face risks that are either
      non-financial or non-quantifiable. Such risks principally include business,
      legal, regulatory, operational and credit risks and are discussed elsewhere
      in
      this document as well as in the 2005 Form 10-K and therefore are not represented
      here.




Great
      Plains Energy and consolidated KCP&L interim period disclosures about market
      risk included in quarterly reports on Form 10-Q address material changes, if
      any, from the most recently filed annual report on Form 10-K. Therefore, these
      interim period disclosures should be read in connection with Item 7A.
      Quantitative and Qualitative Disclosures About Market Risk, included in the
      companies’ 2005 Form 10-K, incorporated herein by reference. There have been no
      material changes in Great Plains Energy’s or consolidated KCP&L’s market
      risk since December 31, 2005.




**ITEM
      4. CONTROLS AND PROCEDURES**




**Disclosure
      Controls and Procedures**


Great
      Plains Energy and KCP&L carried out evaluations of their disclosure controls
      and procedures (as defined in Rules 13a-15(e) or 15d-15(e) under the Securities
      Exchange Act of 1934, as amended) as of the end of the fiscal quarter ended
      March 31, 2006. These evaluations were conducted under the supervision, and
      with
      the participation, of each company’s management, including the chief executive
      officer and chief financial officer of each company and the companies’
disclosure committee.


59


Based
      upon these evaluations, the chief executive officer and chief financial officer
      of Great Plains Energy, and the chief executive officer and chief financial
      officer of KCP&L, respectively, have concluded as of the end of the period
      covered by this report that the disclosure controls and procedures of Great
      Plains Energy and KCP&L are functioning effectively to provide reasonable
      assurance that: (i) the information required to be disclosed by the respective
      companies in the reports that they file or submit under the Securities Exchange
      Act of 1934, as amended, is recorded, processed, summarized and reported within
      the time periods specified in the SEC’s rules and forms, and (ii) the
      information required to be disclosed by the respective companies in the reports
      that they file or submit under the Securities Exchange Act of 1934, as amended,
      is accumulated and communicated to their respective management, including the
      principal executive and principal financial officers, as appropriate to allow
      timely decisions regarding required disclosure.




**Changes
      in Internal Control Over Financial Reporting**


There
      has
      been no change in Great Plains Energy’s or KCP&L’s internal control over
      financial reporting that occurred during the quarterly period ended March 31,
      2006, that has materially affected, or is reasonably likely to materially
      affect, those companies’ internal control over financial reporting.




**PART
      II** ***-*** **OTHER
      INFORMATION**




**ITEM
      1. LEGAL PROCEEDINGS**




**Iatan
      No. 2 Air Permit**


On
      January 31, 2006, the Missouri Department of Natural Resources issued an air
      permit to KCP&L for the construction of Iatan No. 2 and modifications to
      Iatan No. 1. The Sierra Club has appealed the issuance of this permit to the
      Missouri Air Conservation Commission and a hearing on the appeal is expected
      in
      August 2006. The permit remains in effect pending the outcome of the
      appeal.




**KCP&L
      Stipulations and Agreements**


On
      March
      28, 2005, and April 27, 2005, KCP&L filed Stipulations and Agreements with
      the MPSC and KCC, respectively, containing a regulatory plan and other
      provisions. The MPSC issued its Report and Order, approving the Stipulation
      and
      Agreement, on July 28, 2005, and KCC issued its Order Approving Stipulation
      and
      Agreement on August 5, 2005. On September 22, 2005, the Sierra Club and
      Concerned Citizens of Platte County, two nonprofit corporations, filed a
      petition for review in the Circuit Court of Cole County, Missouri, seeking
      to
      review and set aside the MPSC Report and Order. On March 13, 2006, the Circuit
      Court affirmed the MPSC Order. On April 21, 2006, the Sierra Club filed a Notice
      of Appeal from the Circuit Court decision to the Missouri Court of Appeals,
      Western District. On October 21, 2005, the Sierra Club filed a petition for
      review in the District Court of Shawnee County, Kansas, seeking to set aside
      or
      remand KCC order. The Kansas District Court denied the Sierra Club’s appeal on
      May 1, 2006. The Sierra Club may appeal to the Kansas Court of Appeals. Although
      subject to the appeals, the MPSC and KCC orders remain in effect pending the
      court’s decision. The Kansas appeal is expected to be decided by the court in
      2006.




**Kansas
      City Power & Light Company v. Union Pacific Railroad
      Company**


On
      October 12, 2005, KCP&L filed a rate complaint case with the STB charging
      that Union Pacific’s rates for transporting coal from the PRB in Wyoming to
      KCP&L’s Montrose Station are unreasonably high. Prior to the end of 2005,
      the rates were established under a contract with Union Pacific. Efforts to
      extend the term of the contract were unsuccessful and Union Pacific is the
      only
      service for coal transportation from the PRB to Montrose Station. KCP&L
      charged that Union Pacific possesses market dominance over the traffic and
      requested the STB prescribe maximum reasonable rates. In February 2006, the
      STB
      announced a rulemaking proceeding to address certain issues associated with
      the
      calculation of stand-alone costs in rate complaint cases. Proceedings in
      KCP&L’s rate complaint case have been suspended pending the outcome of this
      rulemaking, and management currently expects a


60


decision
      in the case in 2008. Until the STB case is decided, KCP&L is paying tariff
      rates subject to refund.




**ITEM
      1A. RISK FACTORS**




Actual
      results in future periods for Great Plains Energy and consolidated KCP&L
      could differ materially from historical results and the forward-looking
      statements contained in this report. Factors that might cause or contribute
      to
      such differences include, but are not limited to, those discussed below and
      in
      Item 1A. Risk Factors included in the companies’ 2005 Form 10-K. The companies’
business is influenced by many factors that are difficult to predict, involve
      uncertainties that may materially affect actual results, and are often beyond
      the companies’ control. Additional risks and uncertainties not presently known
      or that the companies’ management currently believes to be immaterial may also
      adversely affect the companies. The risk factors described below, as well as
      the
      other information included in this report and in the other documents filed
      with
      the SEC, should be carefully considered before making an investment in the
      securities of Great Plains Energy and KCP&L. Risk factors of consolidated
      KCP&L are also risk factors for Great Plains Energy.




**The
      outcome of KCP&L’s pending retail rate proceedings, which could have a
      material impact on its business, are largely outside its control.**


The
      rates
      that KCP&L is allowed to charge its customers are the single most important
      item influencing its results of operations, financial position and liquidity.
      These rates are subject to the determination, in large part, of governmental
      entities outside of KCP&L’s control, including the MPSC, KCC and FERC.
      Decisions made by these entities could have a material impact on KCP&L’s
      business including its results of operations, financial position, or liquidity.




In
      February 2006, for the first time in 20 years, KCP&L filed with the MPSC and
      KCC requests to increase the rates it is permitted to charge its retail
      customers in Missouri and Kansas, respectively. In these initial filings
      KCP&L is seeking an increase in annual rates of 11.5% in Missouri and 10.5%
      in Kansas. The requested rate increases are subject to the approval of the
      MPSC
      and KCC, which are expected to rule by December 2006. It is possible that the
      MPSC and/or KCC will authorize a lower rate increase than what KCP&L has
      requested, or no increase or a rate reduction. Management cannot predict or
      provide any assurances regarding the outcome of these proceedings. Any rate
      changes approved by the MPSC and KCC are expected to take effect on January
      1,
      2007.




As
      a part
      of the Missouri and Kansas stipulations approved by the MPSC and KCC in 2005,
      KCP&L undertook to implement a Comprehensive Energy Plan (Plan). Under the
      Plan, KCP&L will undertake certain projects, including building and owning a
      portion of Iatan No. 2, installing a new wind-powered generating facility,
      and
      installing environmental upgrades to certain existing plants. KCP&L’s
      obligations to undertake the Plan and to incur the related capital expenditures
      are independent from, and not conditional on, the regulators’ approval of the
      associated rate increase requests. A reduction or rejection by the MPSC or
      KCC
      of these requests would result in increased financing requirements for
      KCP&L. This could have a material impact on its results of operations,
      financial position or liquidity.




In
      response to competitive, economic, political, legislative and regulatory
      pressures, KCP&L may be subject to rate moratoriums, rate refunds, limits on
      rate increases or rate reductions, including phase-in plans. Any or all of
      these
      could have a significant adverse effect on KCP&L’s results of operations,
      financial position or liquidity.




**KCP&L
      has Retirement-Related Risks**


Through
      2010, approximately 26% of
      KCP&L’s current employees will be eligible to retire with full pension
      benefits. Failure to hire and adequately train replacement employees, including
      the transfer of significant internal historical knowledge and expertise to
      the
      new employees, may adversely affect KCP&L’s ability to manage and operate
      its business.


61


Substantially
      all of KCP&L’s employees participate in defined benefit and postretirement
      plans. If KCP&L employees retire when they become eligible for retirement
      through 2010, or if KCP&L’s plans experience adverse market returns on its
      investments, or if interest rates materially fall, KCP&L’s pension expense
      and contributions to the plans could rise substantially over historical levels.
      KCP&L expects to recognize pension settlement charges in 2006 resulting from
      employees retiring and electing to receive the pension benefit lump sum payment
      option. The current estimate of such charges, based on retirement-eligible
      employees who left the company through April 1, 2006, is approximately $7.8
      million. The actual pension settlement charges in 2006 will depend on actual
      pension plan results during the pension plan year and the number of employees
      retiring throughout the year who select the lump sum payment option. The amount
      of settlement charges to be recognized in 2006 may be materially greater than
      the current estimate. The timing and number of employees retiring after 2006
      and
      selecting the lump sum payment option could result in further pension settlement
      charges that could materially affect KCP&L’s results of operations. In
      addition, assumptions related to future costs, returns on investments, interest
      rates and other actuarial assumptions, including projected retirements, have
      a
      significant impact on KCP&L’s results of operations and financial position.
      Proposed legislation pending in Congress on pension reform could result in
      increased pension funding requirements. The Financial Accounting Standards
      Board
      (FASB) has a project to reconsider the accounting for pensions and other
      post-retirement benefits. This project may result in accelerated expense,
      liability recognition and contributions.




**ITEM
      2. UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF
      PROCEEDS**


The
      following table provides
      information regarding purchases by the Company of its equity securities during
      the first quarter of 2006.


**Issuer
                    Purchases of Equity Securities****Maximum
                    Number****Total
                    Number of**
                
                **(or
                    Approximate****Shares
                    (or Units)**
                
                **Dollar
                    Value) of****Total**
                
                
                
                
                **Purchased
                    as**
                
                **Shares
                    (or Units)****Number
                    of**
                
                
                **Average**
                
                **Part
                    of Publicly**
                
                **that
                    May Yet Be****Shares**
                
                
                **Price
                    Paid**
                
                **Announced**
                
                **Purchased
                    Under****(or
                    Units)**
                
                
                **per
                    Share**
                
                **Plans
                    or**
                
                **the
                    Plans or****Month**
                **Purchased**
                
                
                **(or
                    Unit)**
                
                **Programs**
                
                **Programs**January
                    1 - 31
                
                -
                
                
                $
                -
                
                
                -
                
                
                N/AFebruary
                    1 - 28
                
                1,460
                (1)
                
                
                28.20
                
                
                -
                
                
                N/AMarch
                    1 - 31
                
                -
                
                
                
                -
                
                
                -
                
                
                N/ATotal
                
                1,460
                
                
                $
                28.20
                
                
                -
                
                
                N/A(1) 
                    Represents shares of common stock surrendered to the Company
                    by certain
                    officers to paytaxes
                    related to the issuance of performance
                    shares.


**ITEM
      3. DEFAULTS UPON SENIOR SECURITIES**


None.




**ITEM
      4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS**


None.




**ITEM
      5. OTHER INFORMATION**




At
      its
      May 2, 2006, meeting, the Board of Directors of Great Plains Energy increased
      the annual retainer to be paid in 2006 to non-employee directors from $60,000
      to
      $85,000 ($50,000 of which will


62


be
      used
      on behalf of the directors to acquire shares of Great Plains Energy’s common
      stock through its Dividend Reinvestment and Direct Stock Purchase Plan). The
      Board of Directors also at that meeting increased the annual retainer to be
      paid
      in 2006 to the Chair of the Audit Committee from $6,000 to $10,000, and
      increased the annual retainer to be paid in 2006 to the non-employee director
      serving as the Lead Director from $10,000 to $20,000. The Board of Directors
      further determined that medical insurance coverage will not be made available
      to
      newly-appointed non-employee directors. In March 2006, Great Plains Energy
      amended its director charitable contribution match program. Under the amended
      program, Great Plains Energy will match, on a two-for-one basis, a director’s
      charitable contributions of up to $5,000 per year to 501(c)(3) organizations
      in KCP&L's generation and service communities.




**ITEM
      6. EXHIBITS**




**Great
      Plains Energy Documents**





Exhibit
              Number
            
            Description
                of Document10.1
            +
            Description
                of Compensation Arrangements with Directors.12.1
            
            Ratio
                of Earnings to Fixed Charges.31.1.a
            
            Rule
                13a-14(a)/15d-14(a) Certifications of Michael J. Chesser.31.1.b
            
            Rule
                13a-14(a)/15d-14(a) Certifications of Terry Bassham.32.1
            
            Section
                1350 Certifications.


+
      Indicates management contract or compensatory plan or arrangement.





Copies
      of
      any of the exhibits filed with the Securities and Exchange Commission in
      connection with this document may be obtained from Great Plains Energy upon
      written request.




Great
      Plains Energy agrees to furnish to the SEC upon request any instrument with
      respect to long term debt as to which the total amount of securities authorized
      does not exceed 10% of total assets of Great Plains Energy and its subsidiaries
      on a consolidated basis.




**KCP&L
      Documents**





Exhibit
              Number
            
            Description
                of Document12.2
            
            Ratio
                of Earnings to Fixed Charges.31.2.a
            
            Rule
                13a-14(a)/15d-14(a) Certifications of William H. Downey.31.2.b
            
            Rule
                13a-14(a)/15d-14(a) Certifications of Terry Bassham.32.2
            
            Section
                1350 Certifications.





Copies
      of
      any of the exhibits filed with the Securities and Exchange Commission in
      connection with this document may be obtained from KCP&L upon written
      request.




KCP&L
      agrees to furnish to the SEC upon request any instrument with respect to long
      term debt as to which the total amount of securities authorized does not exceed
      10% of total assets of Great Plains Energy and its subsidiaries on a
      consolidated basis.


63


**SIGNATURES**




Pursuant
      to the requirements of the Securities Exchange Act of 1934, Great Plains Energy
      Incorporated and Kansas City Power & Light Company have duly caused
      this report to be signed on its behalf by the undersigned thereunto duly
      authorized.




**GREAT
                PLAINS ENERGY INCORPORATED**Dated:
                May 5, 2006
            By:/s/Michael
                J. Chesser(Michael
                J. Chesser)(Chief
                Executive Officer)Dated:
                May 5, 2006
            By:/s/Lori
                A. Wright(Lori
                A. Wright)(Principal
                Accounting Officer)










**KANSAS
                CITY POWER & LIGHT COMPANY**Dated:
                May 5, 2006
            By:/s/William
                H. Downey(William
                H. Downey)(Chief
                Executive Officer)Dated:
                May 5, 2006
            By:/s/Lori
                A. Wright(Lori
                A. Wright)(Principal
                Accounting Officer)






64