Federal regulators approve cost sharing for Oklahoma power projects

The Federal Energy Regulatory Commission has signed off on a cost-sharing plan for $1.1 billion in electric transmission projects for Oklahoma and other states in the region.

Federal regulators cleared the way Thursday for a $1.1 billion bundle of electrical transmission projects in Oklahoma and surrounding states.

The six-project priority list was approved in April by the Southwest Power Pool's board of directors, contingent on the Federal Energy Regulatory Commission's signing off on a proposed cost-sharing plan that spread out the burden of upgrading the region's power grid.

The "Highway/Byway" plan was approved Thursday, meaning Southwest Power Pool members - which include Oklahoma's two largest electric companies - now will split the costs of high-voltage transmission projects. Lower voltage projects will be paid by local power companies.

Southwest Power Pool President Nick Brown hailed the decision as one that will help members build a stronger transmission grid to benefit the entire region.

"The SPP region is evolving from a utility-by-utility focus on 'keeping the lights on' at the local level to a regionwide focus on building a robust transmission system," he said. "Sharing costs and benefits of more transmission highways and byways will increase our ability to deliver lower-cost power to customers, allow us to make the most efficient use of the region's diverse generating resources, and help us meet state and federal policy goals such as increased use of renewable energy."

Oklahoma Corporation Commissioner Jeff Cloud said he was pleased the cost-sharing plan was approved.

"It's another hurdle in getting these important projects to Oklahoma," he said.

The state will get about $500 million in high-voltage power line projects, including two that will make it easier to tap into western Oklahoma's wind power potential.

Cloud said a planned $247 million line between Woodward and the Guymon area will be a huge boon to wind development in Oklahoma. Another $108 million line is expected to link Woodward to $356 million in new transmission lines in Kansas.

Oklahoma also is home to two other projects on the priority project list: a $131 million line between Valliant and Texarkana, Texas, and $840,000 worth of new equipment in Tulsa.

The list also includes a $301 million line from Nebraska City, Neb., to Maryville, Mo., to Sibley, Mo.

Officials have not determined exactly how the bill for those projects will be split, but Oklahoma's two largest electric companies know about what their tab will be.

Oklahoma Gas and Electric Co. will pay about 13 or 14 percent of the cost, while Public Service Co. of Oklahoma will be responsible for less than 10 percent. Those figures are based on how much of the region's total electricity load is consumed by each company.

Those costs will not be assessed until the new projects are completed, likely sometime in 2013 or 2014, OG&E spokesman Brian Alford said.

Brown said a stronger power grid is worth the cost.

"The electric grid is in use every second of every day, so the economics of transmission aren't just long-term but instantaneous," he said. "A robust grid optimizes economics and improves electric reliability."