Commission approves $25 million OG&E rate cut

OKLAHOMA CITY (AP) _ A $25 million rate cut for Oklahoma Gas and Electric Co. customers received preliminary approval Wednesday from the Oklahoma Corporation Commission. <br><br>``I think it's an outstanding

Wednesday, November 20th 2002, 12:00 am

By: News On 6

OKLAHOMA CITY (AP) _ A $25 million rate cut for Oklahoma Gas and Electric Co. customers received preliminary approval Wednesday from the Oklahoma Corporation Commission.

``I think it's an outstanding achievement for residential customers,'' said Corporation Commission member Bob Anthony. ``It's a good thing for the company, too. It eliminates uncertainty in the financial market about their treatment.''

Residential customers will see a little more than $8 million in cuts, with the balance going to commercial and municipal customers, said commission spokesman Matt Skinner. The cut will lower the average residential customers' bill by about $15 a year.

The reduction will appear on customers' monthly bills beginning in January.

The rate cut is part of a package of more than $90 million in benefits to OG&E customers. The utility said the rate cut and acquisition of new generating capacity will save its customers at least $75 million in the next three years.

The rate cut, part of an agreement announced last month between the utility, the commission and Attorney General Drew Edmondson's office, was given unanimous approval by the three-member Corporation Commission, which regulates utilities.

Final approval is expected on Friday, Skinner said.

OG&E had been seeking a $26 million rate increase in part to recover expenses from a January ice storm that knocked out power to more than 195,000 customers, pulled down 270 miles of transmission lines and toppled 6,000 utility poles.

Utility officials said the settlement will permit OG&E to recover ice storm expenses and avoid the risk of an even bigger cut if the rate case was heard by an administrative judge.

OG&E plans to purchase a new, more efficient generation plant by July, decreasing the utility's costs by at least $25 million.

The settlement also will effect electric rates by reconfiguring OG&E's off-system sales to other power companies.

The agreement includes a cogeneration rider involving some of OG&E's long-term contracts that will result in an average $31.2 million in benefits to consumers over the next three years.

The utility said the rate cut is OG&E's ninth without an increase in 16 years.

OG&E is Oklahoma's largest electric utility and serves 700,000 customers in Oklahoma and western Arkansas.