Oklahoma Gas and Electric said Wednesday it has completed the acquisition of two Oklahoma generators from which it had previously bought power to meet its capacity needs.
OG&E said FERC’s approval of the transactions (EC19-49) was the final regulatory OK it needed to complete its purchases. Financial terms were not disclosed, but OG&E said last year it would spend $53 million to acquire the plants.
AES Shady Point is a 360-MW, coal-fired facility in Eastern Oklahoma; privately owned Oklahoma Cogeneration is a 146-MW combined cycle plant in Oklahoma City.
OG&E, a subsidiary of Oklahoma City-based OGE Energy, had contracts with both resources under the Public Utility Regulatory Policies Act of 1978. The legislation requires utilities to buy power from cogeneration plants built by non-utility power producers when the costs for that power are equal to or less than what the utility would spend to produce that power from a facility it would build and own.
Shady Point qualified for the cogeneration requirement by using some of its carbon dioxide emissions as a liquid and solid food-grade refrigerant for the poultry industry. However, OG&E said last year it was ending a five-year power purchase agreement with the plant, leading AES to announce it would close the facility.
OGE Energy CEO Sean Trauschke has said he expects “operational changes” to reduce Shady Point’s coal usage by more than 50%. The plant came online in 1991.
Spokesman Brian Alford said the acquisitions will save OG&E customers “tens of millions of dollars” annually and keep “good-paying jobs in Oklahoma.”
OG&E received approval from Arkansas and Oklahoma regulators earlier this month.
— Tom Kleckner
