Kansas regulators are reviewing a proposal to let the state’s largest electric company raise rates for residential customers by an average of $3 a month.

The Kansas Corporation Commission’s hearing Thursday focuses on a settlement involving Westar Energy and representatives of its customers. The deal would let Westar boost overall rates by about $31 million annually, or less than 2 percent.

The company had proposed a slightly higher overall increase, mostly to pay for environmental upgrades at its La Cygne power plant in eastern Kansas.

But it also wanted to shift about $50 million in charges to residential customers and small businesses from larger businesses and public schools. Under the settlement, it would drop that idea.

Westar has nearly 700,000 customers in Kansas.