(The Center Square) – Customers of Oklahoma Gas and Electric (OG&E) won’t absorb the cost of February’s winter storms immediately but will pay over the next 28 years, a move the chair of the Oklahoma Corporation Commission (OCC) said would save ratepayers hundreds of dollars on their bills.
The order between OG&E and the OCC is possible because of a new securitization law passed by the Oklahoma Legislature and signed into law by Gov. Kevin Stitt in April that allows ratepayer-backed bonds to offset the costs.
“It’s estimated that simply passing through $748.9 million in fuel costs would have resulted in the average residential consumer being charged an unmanageable amount of more than $400 dollars in one month just for the storm,” OCC Chair Dana Murphy said in a news release. “Under the agreement, that is lowered to $2.12 a month, with the reimbursement spread out over 28 years using the state’s new securitization law.”
Complicating the situation is an increase in natural gas prices.
“Natural gas pricing falls outside of commission jurisdiction,” Murphy said. “Our agency’s auditors have worked to ensure that OG&E is not making any profit on the fuel costs and that the purchase of the fuel met the other requirements of state law. But there is no changing the fact that for electricity to be able to be supplied during the storm, those purchases had to be made at prices that were unimaginable before the event.”
OG&E also will take steps to reduce the effect of similar events, according to corporation Commissioner Todd Hiett.
“Further, OG&E has agreed to apply any savings that result from future federal or legal action associated with the February fuel costs to the credit of customers,” Hiett said.
The resolution would “put further financial pressure on older Oklahomans on fixed incomes,” AARP Oklahoma said in a statement on its website.
“AARP Oklahoma is extremely disappointed with today’s ruling by the majority of Oklahoma’s Corporation Commissioners which forces more than 870,000 Oklahomans to pick up the tab for all the costs from the February 2020 storm while OG&E pocketed $224 million in profit last quarter alone,” State Director Sean Voskuhl said.
via Oklahoma's Center Square News