THE OKLAHOMAN: Point of View: Oklahoma’s integrated utility is reliable, affordable and efficient

By Jeff Cloud | March 22, 2021

In February, Oklahoma, along with a large swath of the central United States, experienced a significant, days-long snowstorm. Not only did the far-reaching frigid temperatures freeze pipes and impact vegetation — they also created an unprecedented demand that put many states’ energy systems to the test. Our state was not immune, and government leaders, regulators and utilities worked closely together during the storm and in its aftermath to encourage conservation, successfully avoid protracted outages and manage utility costs for Oklahomans.

For our neighbors to the south, the situation was unfortunately much more severe. When the need for conservation arose, Texas’ deregulated energy system made it difficult for the state to avoid fuel shortages, and many Texans lived through week-long outages amidst frigid temperatures. The blackouts further exacerbated the water crisis brought on by frozen and burst pipes and water mains statewide, effectively forcing many families to live for days with limited access to heat or water.

While some external groups will continue clamoring to restructure our electricity industry, the February storm is the most recent of many examples that such deregulation jeopardizes long-term security and affordability. In 2000, Oklahoma was one of many states exploring a restructure of the utility business to provide lower prices. Since then, we have learned from places like Texas, California, New York and Nevada that deregulated markets are more expensive and do not have the same guard rails in place to withstand emergencies. Oklahomans agree. A 2021 study by CHS & Associates revealed only 11 percent of likely voters now favor deregulating the state’s utility system.

By contrast to other states, Oklahoma is part of the Southwest Power Pool (“SPP”), a nonprofit operating a wholesale power market for utility and transmission companies in 17 states. The SPP’s role and visibility increased significantly during February, as the group managed the conservation advisories and controlled electricity interruptions implemented statewide.

In our state, the Oklahoma Corporation Commission (OCC) holds regulated utilities accountable to appropriately balance keeping customer rates affordable while also being attractive for infrastructure investment. Oklahomans have some of the lowest cost electricity available and our utilities work with other states to avoid major supply issues. The OCC also works with utilities to recover costs in a manner that minimizes the impact on customer bills. Compare this to Texas, where marketers make money at consumers’ expense and no backup plan exists to source emergency energy supplies. Our partnerships with the SPP and OCC become our safety nets in dire situations.

Electricity powers our world. As technology becomes increasingly central to our lives, deregulation will neither minimize costs, nor reduce outages. Rather, it risks Oklahoma’s reliable, affordable power to follow an unproven path many in other states now wish they had avoided.

Jeff Cloud served on the Oklahoma Corporation Commission for more than eight years, spending three of the years as chairman. He is a former board member of the Regional State Committee of the Southwest Power Pool and member of the Electricity Committee at the National Association of Regulatory Commissioners. Cloud is the executive director of the Alliance for Secure Energy.