In Oklahoma, a Utility Files to ‘Make Hay While the Sun Shines’

Back in April 2014, Oklahoma Governor Mary Fallin (R) signed Senate Bill 1456, a measure that scrapped the state’s ban on recovery of fixed costs from residential electric customers with distributed energy resources (DERs). The bill also mandated that other utility ratepayers should not be asked to subsidize such fixed costs. Now, Oklahoma Gas & Electric (OG&E) has filed with the Oklahoma Corporation Commission (OCC) for the go-ahead to impose “demand charges” on rooftop solar installations or small wind turbines by year-end 2015.

The utility – which serves about 750,000 customers in Oklahoma and western Arkansas – has proposed that a so-called distributed generation tariff be imposed on customers who benefit from low-cost renewable energy, but “who are not paying “their fair share” of fixed costs for OG&E infrastructure.

Indeed, the utility claims, customers with DERs are reaping the rewards of sun- and wind-generated energy at certain times of day; while other customers are inequitably paying the price for distribution poles, transformers, transmission lines, and associated fixed costs.

This “subsidization theory” has yet to be proven, according to solar and wind advocates, who are bound to fight the filing when a hearing date is set by the OCC.

As The Oklahoman’s Paul Monies reports, the fixed charge will be calculated “by measuring customer usage in 15-minute increments. A customer’s peak demand on the system [over the course of one month] would be used to calculate that customer’s demand charge.”

OG&E estimates that most distributed generation users would pay about $16 of their bill for a demand charge, if the utility’s filing is approved. Only 200 of OG&E’s ratepayers already have installed rooftop solar, the utility estimates. However, that’s enough to set a line in the sand for the future.

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