Dive Brief:
- Oklahoma Gas and Electric Co.’s (OG&E) planned upgrades to meet federal environmental mandates, including the $500 million installation of scrubbers at its Sooner coal plant, the conversion of two of the three coal units at its Muskogee plant to natural gas, and the replacement of the natural gas unit at the Mustang plant with a flexible combined-cycle natural gas turbine, will likely cause ratepayer bill increases of 15% to 20% by 2019.
- Because it expects the price of natural gas to double, none of the proposed 25 options to meet the federal regional haze rule by 2016 and the federal mercury and air toxics rule by 2019 can preserve reliability and fuel diversity without increasing customer costs, OG&E reported in its draft integrated resource plan just filed with the Oklahoma Corporation Commission.
- The upgrades will allow OG&E to help Oklahoma meet its required 41% reduction in greenhouse gas emissions mandated by the just released draft EPA emissions reduction plan.
Dive Insight:
A Sierra Club Beyond Coal campaign spokesperson said OG&E has taken a “half step in the right direction” but urged it to take more advantage of the state’s low-cost wind resources and, like Public Service Co. of Oklahoma, the state’s other large electric utility, commit to eliminating coal.
OG&E has 670 megawatts of wind capacity but has declined to add more until planned new transmission is available. The utility has found large-scale solar generation to not yet be cost-competitive.
With the new flexible natural gas capacity at the Mustang facility, OG&E will be able to participate fully in the Southwest Power Pool electricity market and provide some of the reserve services needed for the integration of variable renewables like wind into the 8-state regional grid.
