OKLAHOMA CITY — A state lawmaker desires to pressure Oklahoma public utilities that purchased power at extraordinary prices in the course of the 2021 winter weather occasion after which relied on securitization to move these bills on to shoppers to “proactively” take steps to start hardening their infrastructure.
Senate Bill 204, filed by Republican state Sen. Nathan Dahm, would require any of the public utilities that used securitization to mitigate their extraordinary prices to “take strategic action to proactively prepare for future weather events” in an effort to guard shoppers and stop outages or further extraordinary prices.
The bill says some of that motion might embrace burying strains, shielding transformers and putting in cyber safety measures. It doesn’t deal with who would pay for the preparation, however stated the “strategic action” should happen no later than Jan. 1, 2029.
Dahm didn’t reply to messages left in search of touch upon his bill this week, however in an emailed news launch, he stated the bill is “an effort to keep our state as dissimilar to California as possible and avoid their rolling blackouts.”
The measure seems focused on the state’s three largest public utility suppliers — OG&E, PSO and Oklahoma Natural Gas — who purchased pure gasoline at astronomical costs in the course of the February 2021 two-week winter storm after which obtained permission from state regulators to securitize that debt by including a month-to-month price onto shoppers’ payments that can final a number of many years.
Oklahoma shoppers confronted greater than $4.5 billion in further power technology prices in consequence of the storm.
The chilly created main challenges for the state’s power provide as renewable sources like wind and photo voltaic dropped to just about zero manufacturing, pure gasoline wells froze and compressor stations went offline. Utility corporations scrambled to purchase power at skyrocketing costs. Public utilities reported that they have been compelled to purchase pure gasoline at as a lot as $1,200 MMBtu (a unit of measuring pure gasoline equal to 1,000,000 British thermal models) when it had been promoting for about $2 to $3 simply forward of the two-week chilly snap.
In an effort to beat back enormous upfront prices for ratepayers, state lawmakers swiftly handed laws permitting the utilities to securitize the debt by including the month-to-month price. Corporation commissioners later decided that the businesses acted prudently once they purchased the pure gasoline, and ratepayers, not shareholders, needs to be answerable for the debt.
“We appreciate Sen. Dahm bringing attention to the mistakes and mismanagement that occurred during Winter Storm Uri,” stated Sean Voskuhl, AARP Oklahoma state director, in an announcement. “We continuously hear from customers asking if the utilities learned from their mistakes and what assurances are in place that this won’t happen again.”
The AARP steadily intervenes in utility fee circumstances on behalf of its 100,000 members who depend on public utilities.
Voskuhl, although, stated the massive query is that if the prices to harden the utilities would be immediately handed on to utility clients.
“Oklahomans are already paying record utility rates and can’t afford more increases,” he stated. “We look forward to learning more about this bill.”
Nick Singer, govt director of Oklahoma Progress Now, stated “the devil’s in the details” with the way it would be applied, nevertheless it’s positively value contemplating.
Singer has been important of how the securitization course of labored, and he continues to query why there isn’t a price-gouging investigation to assist shoppers recoup some of the prices.
He stated the massive downside with the state’s securitization regulation is there’s nothing that requires utilities or producers to take any steps to forestall an analogous occasion from taking place once more. He’d like an accountability mechanism for who’s in the end accountable, he stated.
“Securitization makes it 100% the consumers’ responsibility,” Singer stated. “Everyone on the corporate side gets paid, so it’s like we are actually incentivizing them to not prepare for natural disasters by doing securitizations, and that is wildly unethical. A bad idea.”
In an e mail, Wayne Greene, a spokesman for PSO, stated the utility is conscious of Dahm’s bill and is “always eager to work with members of the Legislature to ensure continued reliable, affordable power for our customers.”
He stated PSO has already taken steps to protect clients from the consequences of sudden spikes in power prices. Those steps embrace finishing power amenities, which give a fuel-free complement to PSO’s current pure gas-powered technology fleet, securing fixed-price gasoline contracts and bodily hedging to guard shoppers in opposition to the acute worth spikes seen in the course of the winter storm.
“PSO is constantly preparing, analyzing and realigning strategies to serve our customers,” Greene stated. “PSO’s pending rate case and the proposed fuel-free power plan would continue our determination to meet our customers’ growing energy needs while protecting them against the corrosive inflationary effects of high fuel costs and sudden price hikes.”
Jason Cleary, a spokesman for Oklahoma Natural Gas, stated in an e mail that the corporate is monitoring all proposed laws and reviewing its potential influence.
OG&E didn’t reply to a request for remark.
Janelle Stecklein covers the Oklahoma Statehouse for CNHI’s newspapers and web sites. Reach her at [email protected].
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