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Electric aftershocks

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In the wake of Winter Storm Uri, anxiety abounds where upcoming utility bills are concerned.

But for Purcell residents, there is hope that anxiety will be allayed.

City manager Dale Bunn told the city council on Monday that the Oklahoma Municipal Power Authority’s finance committee is recommending to the board of directors to absorb the 133- to 333-fold increase in natural gas prices during the storm.

Bunn chairs the finance committee.

The authority normally purchases natural gas to fuel electricity generation at a cost of $3 per million BTU.

During the storm, however, that price soared as high as $1,000 per million BTU. The authority was able to purchase some natural gas for $400 per million BTU.

OMPA is out some $60 million in increased fuel costs.

Instead of placing that burden on consumers, the plan is to refinance the authority’s existing loans and extend the time to pay those off.

Bunn, who serves as the board’s treasurer, said Tuesday that he expects the board to approve the recommendation when they meet March 11.

The bottom line for  electric customers in OMPA’s member cities is this: no fuel cost adjustment on post-storm bills.

“But you will have higher bills if you used more electricity,”  he continued.

The bitter storm didn’t hammer just Oklahoma and unprecedented demands were placed on a power grid not designed for the national deep freeze.

Though temperatures have recovered to seasonal norms, the big question on the minds of many is the cost of staying warm during the storm.

Some concerns were raised last week after an Oklahoma City television station reported OMPA isn’t regulated by the Oklahoma Corporation Commission.

The reason, Bunn said, is a simple one. OMPA is a state agency.

The authority has requested the Oklahoma Attorney General’s Office investigate and determine if natural gas producers engaged in price gouging when rates rose as the mercury plummeted.  

The price hike for natural gas produced a ripple effect across “at least 200 other utilities,” Bunn told the board.

The estimated hit on additional utilities is $6 billion, he said.

Oklahoma Natural Gas on February 14 called on its customers to cut back their natural gas usage.

“That helped us avoid widespread outages during the extreme weather event,” the company reported on its website.”

That curtailment was lifted February 21.

ONG noted it does not set the market price for natural gas and in fact purchases natural gas from suppliers.

“The price we pay the suppliers for gas is the price customers pay. There is no markup,” ONG reported. “We will be working with the Oklahoma Corporation Commission on options related to the impact to customer bills associated with the current price spikes in natural gas.

“We will work with every customer to help them find alternatives for paying their bill. There are a number of payment options and resources that we offer customers who are having financial difficulty. While we don’t know the details of the impact from this winter storm yet, we will commit to doing what we can to help our customers.”

OG&E reported spending “about 1 billion” in fuel costs during the storm.

That utility has proposed to the Oklahoma Corporation Commission a 2-step plan to recover that cost.

The utility would begin recovering a portion of the fuel costs starting in April and continuing through December.

Then starting in January 2022, the remainder of those costs would be recovered over a period of 10 years.

“If approved, the average residential customer should expect an increase on their monthly bill of less than 10 percent,” OG&E reported.

Patrick Grace, chief executive officer for Oklahoma Electric Cooperative, said OEC  is “prepared to work with each individual member to set up a flexible payment plan, if needed. We understand the magnitude of this event and its potential long-term effects, and we want to work with you.

“Unfortunately, we will all feel the effects of February’s events when we open our March bills. We are using some cash reserves we have in place specifically for events like this to absorb some of the blow, but the record-setting usage will almost certainly lead to electric bills quite a bit higher than normal.”

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