Dive Brief:
- The public utilities division of Oklahoma Attorney General Mike Hunter’s office has asked state regulators to dismiss American Electric Power's plan to purchase a 2,000 MW wind farm.
- Last month, AEP subsidiaries Public Service Co. of Oklahoma (PSO) and Southwestern Electric Power proposed purchasing the $4.5 billion wind facility outright, rather than utilizing a standard power purchase agreement.
- But the Tulsa World reports the attorney general's office has asked for a preapproval application to be rejected, arguing the utility has not shown the wind power is actually needed.
Dive Insight:
Hunter's motion alleges American Electric Power's utilities have not shown they need the new generation and failed to use a competitive bidding process before pursuing the project.
The Wind Catcher Energy Connection project also includes a high voltage, 350-mile transmission line that would be key to shipping the output to customers in the South and lower Midwest. The attorney general's motion says that if the Oklahoma Corporation Commission does not reject the application, it should require PSO to pay for its own litigation costs.
“The Attorney General’s full participation is essential, as PSO’s customers are at risk to bear the $1.36 billion cost of the Wind Catcher project if the commission grants PSO’s requested relief,” Hunter's motion reads, according to the Tulsa World.
Invenergy and GE Renewable are constructing the wind farm, one of the biggest under construction in the United States and is scheduled to be completed in 2020.
Bloomberg recently reported on the trend of utilities seeking to purchase these facilities and recover costs instead of buying the output from the developer through a contract. The strategy makes more sense as solar and wind costs decline and compete with natural gas and coal, analysts noted.
