OKLAHOMA CITY – A state lawmaker needs to drive Oklahoma public utilities that purchased power at extraordinary prices through the 2021 winter weather occasion after which relied on securitization to go 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 extra extraordinary prices.
The bill says some of that motion might embody burying strains, shielding transformers and putting in cyber safety measures. It doesn’t handle 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 looking for 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 through the February 2021 two-week winter storm after which obtained permission from state regulators to securitize that debt by including a month-to-month charge onto shoppers’ payments that may final a number of a long time.
Oklahoma shoppers confronted greater than $4.5 billion in extra power technology prices because of this 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 firms scrambled to purchase power at skyrocketing costs. Public utilities reported that they have been pressured to purchase pure gasoline at as a lot as $1,200 MMBtu (a unit of measuring pure gasoline equal to one million British thermal items) when it had been promoting for about $2 to $3 simply forward of the two-week chilly snap.
In an effort to keep off big upfront prices for ratepayers, state lawmakers swiftly handed laws permitting the utilities to securitize the debt by including the month-to-month charge. Corporation commissioners later decided that the businesses acted prudently after they purchased the pure gasoline, and ratepayers, not shareholders, ought to be liable 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 a press release. “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 ceaselessly intervenes in utility fee instances 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 straight 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 carried out, however it’s positively price contemplating.
Singer has been crucial 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 legislation is there’s nothing that requires utilities or producers to take any steps to stop the same occasion from taking place once more. He’d like an accountability mechanism for who’s finally 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 defend clients from the consequences of sudden spikes in power prices. Those steps embody finishing power amenities, which offer 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 through 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 affect.
OG&E didn’t reply to a request for remark.
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