Corporation Commission approves gas rate refunds

Thursday, May 16th 2002, 12:00 am

By: News On 6

OKLAHOMA CITY (AP) _ The average Oklahoma Natural Gas customer will save $50 over the next four years under a rate settlement worked out Thursday between the utility and the Oklahoma Corporation commission.

The total cost of the deal could top $48 million.

After four hours of debate _ mainly over the commission's power to review future gas contracts and how the plaintiff's attorney would receive his legal fees _ the commission voted 2-1 on the agreement.

``I think a miracle has happened here today,'' said Commissioner Bob Anthony, who once criticized the settlement plan for not going far enough to provide direct cash refunds to ratepayers. ``This settlement took a lot of compromise.''

Commissioner Ed Apple, who voted against the agreement, called for improvements in communication in future deals.

``I don't think it's a wholesome process where one commissioner is dealing in things the other doesn't know about,'' said Apple, who says he's still glad the settlement was passed. ``We need to be less dramatic and far more analytical when we come to these decisions.

``We do our best work when we don't scare people or mandate people to do things,'' Apple said.

Barring a 30-day appeal period, ONG's residential customers would receive a $13 credit in July. In addition, bills will go down beginning in April 2003 due to changes in the company's gas purchasing practices that will reduce reservation fees and gas expenses. Finally, in December 2005, customers will receive another credit on their bills of at least $2.30.

``We're ready to see these benefits flow to the rate-payers,'' said Don Sherry, communications manager for ONEOK, the parent company of ONG. ``We came here today prepared to sign this agreement.''

Russell James Walker, who represents the plaintiff in the case, John P. Walker, declined comment on the approval of the agreement.

Michael E. McAdams, the second applicant who initially sought rate relief from ONG, withdrew his name from the case.

Walker said he had no comment on McAdams' departure.

It took months of legal wrangling to reach the agreement, including a heated hearing in late April where commissioners clashed with ONG's attorneys.

``The consumers have been down a rough road,'' said assistant attorney general Cece Coleman. ``The Attorney General is always happy to see consumers get money back in their pockets through cash or credit.''

The first case involved a long-term gas-buying deal made by ONG in 1993. McAdams and Walker alleged that ONG's deal with Dynamic Energy gave preferential treatment to Dynamic and ONG customers paid too much for gas.

Two expert witnesses concluded that ONG owed customers about $45 million as a result of buying gas through the Dynamic deal.

The second case involved ONG's gas-buying practices during the winter of 2000-01, when natural gas prices and utility bills climbed to record-setting levels.

Commissioners decided that ONG had not bought its gas prudently and ruled the utility could not collect $34.6 million still owed to it by consumers. ONG appealed the case to the Oklahoma Supreme Court and has collected the money.