Oklahoma Gas & Electric wants customers to help it recoup more than $600 million worth of investment in environmental upgrades to its two coal-fired power plants. The Oklahoma City-based utility is asking state regulators to approve a 4.4-percent rate increase, amounting to about $78 million per year or an additional $7.60 per month on the average residential bill. OG&E is spending close to $534 million installing emissions-reducing scrubbers on the two coal-fired units at the Sooner Power Plant in north-central Oklahoma. The projects are part of the utility’s response to the federal Regional Haze Rule. “The first Sooner scrubber is online and the second is scheduled to go into service (this month),” said OG&E spokesman Brian Alford. “It’s important to note that this project is on schedule and approximately $80 million under budget.”
OG&E also is converting two units at the Muskogee Power Plant from coal to natural gas-fired generation. The project could cost about $75 million and go online this month, with Alford adding it also is being completed under budget.
“While taking these actions at Sooner and Muskogee, we have maintained customer rates that are among the lowest in the country, at 31 percent below the national average, and within one-half of a percent of our 2014 rates, when these projects began,” Alford said. “Due in large part to the actions we’ve taken at these facilities, overall plant emissions are expected to be significantly lower from 2005 levels. Beginning in 2019, sulfur dioxide emissions are expected to be lower by nearly 90 percent, nitrogen oxide to be lower by nearly 75 percent and carbon dioxide to be lower by approximately 40 percent.”
Alford added that in addition to recovering the Sooner and Muskogee investments, the company’s filing also seeks to align its return on equity (ROE) more closely to the industry average for utilities like OG&E, and to align its depreciation rates to more realistically reflect actual asset lifespans. “OG&E consistently ranks well above the national average in terms of environmental stewardship, safety, customer satisfaction and low customer rates,” said Alford. “Higher performing companies typically have ROEs aligned with, or above, the industry average.”