Corporation Commission OKs refund for OG&E’s customers
This summer may not seem quite as hot for Oklahoma Gas and Electric Co. customers.
The three-member Oklahoma Corporation Commission on Tuesday unanimously approved a settlement agreement with OG&E that will lower customers bills, especially in July.
Officials said the deal approved on Tuesday will give an average residential customer a savings of more than $18 on that month’s bill, thanks to the federal corporate tax cut Congress approved in December.
Beginning in August, the average residential customers will see a monthly bill reduction of about $4.44, compared to the current price they are paying for their power now, officials said.
The settlement agreement, which will save ratepayers about $82.5 million, involved OG&E, the Corporation Commission’s Public Utility Division staff, the Oklahoma Attorney General and consumer
groups including AARP Oklahoma, the Oklahoma Industrial Energy Consumers organization and Walmart.
Commissioner Todd Hiett added language to make it clear that in adopting the agreement, commissioners weren’t establishing new recovery methodologies that might be binding in future proceedings. But he and other commissioners said Tuesday they were convinced it adequately compensates the utility while protecting ratepayers from unreasonable charges.
Commissioner Bob Anthony, who also filed a concurrent opinion in the case, echoed Hiett’s sentiments, particularly noting he was enthused to see the refund utility customers will get in August thanks to the Tax Cut and Jobs Act of 2017. “We don’t need to let companies keep a windfall tax gain at the expense of consumers,” Anthony’s opinion stated. “Consumers ought to enjoy some benefit.”
Commission Chairman Dana Murphy said other aspects of the agreement beyond the tax cut also benefit the utility’s customers. She mentioned a change in the formula the utility agreed to use to reimburse customers for power sales it makes to the Southwest Power Pool, the regional transmission organization that oversees the reliability and affordability of electricity on the electrical grid covering the Great Plains, including Oklahoma.
She also mentioned the fact that customers now can opt to commit to using solar generated power as part of a standard rates option.
OG&E’s benefits
Electric and natural gas utilities are required to file rate cases before the commission to seek to recover costs to upgrade, maintain, operate and depreciate their energy delivery systems while making sure customers aren’t overcharged for the services they are provided.
In this case, OG&E asked for and was allowed to recover $400 million it spent upgrading its Mustang Energy Center to install seven new natural gas-fired generating stations, and $20 million it spent to build a 10-megawatt solar power generating facility near Covington.
However, the case did not include a request from the utility to recover a halfbillion dollars it spent to install coal scrubbers at its Sooner generating station near Red Rock or to recover another half billion dollars it spent to convert two of three units at its Muskogee generating station from coal to natural gas.
OG&E officials have said they intend to seek authorization to recover those costs in later cases.
Attorney General Mike Hunter, who represents ratepayers, and the state director for AARP Oklahoma said Tuesday’s agreement is good for the utility’s customers.
“The rate reduction will give much-needed relief to customers as we head into the summer months, which are some of the most costly, especially for those living on a fixed income,” Hunter stated in a release his office issued.
Sean Voskuhl, AARP Oklahoma’s state director, agreed. “A few dollars a month can mean the difference between filling a prescription, buying a loaf of bread and a gallon of milk or paying their electric bill,” he said.