OG&E addresses franchise 'no vote' concerns at town hall

Jul. 27—A small crowd gathered Monday at the Norman Central Public Library ready with questions for Oklahoma Gas and Electric officials in the wake of a failed franchise election earlier this year.

OG&E addressed common concerns about sustainable energy, explained franchise agreements with cities, and answered all but a few questions following its presentation.

Norman voters declined to renew the utility provider's 25-year agreement on Jan. 11. The agreement expired in 2017 and grants OG&E access to right-of-ways to repair and operate service in a city. As part of the agreement, the company remits about $2.9 million franchise fees to the city.

Terry Bell raised the concern that OG&E has not been trimming trees on and near her property near the corner of McNamee Street and the Firehouse Arts Club, 444 W. Flood Ave.

The Feb 13, 2021 ice storm, Uri, left them without power, which she said she believed was partly caused by overgrown limbs on power lines.

"Every three or four years I'd see them," she said of utility workers. "I was told by your contractors that OG&E wanted to save money, so they stopped."

Staff promised to assist Bell and check the history of its actions in the area. Reached this week, OG&E spokesman Adam Cooper told The Transcript "no record of vegetative-caused outages" for the property had occurred between Sept. 1, 2020 to July 25, 2023."

"The circuit serving this customer was pruned in 2021 as part of our regular maintenance trimming schedule and the circuit is next scheduled for regular maintenance trimming in 2025," Cooper said.

Former Ward 6 City Councilor Bill Scanlon asked company officials why the city has not been offered a shorter contract term, a suggestion residents made during council meetings and one discussed during council study sessions.

"One of the issues was the length of the agreement, 25 verses 15 or 10," Scanlon said. "Tell me the difference between 25 and 10. It's an unanswered question in the presentation."

OG&E's Director of Distribution and Engineering, Brian Huckabay said, "There's not a great answer for the difference," he said, but added he was not the appropriate person to discuss legal matters like franchise agreement terms.

Cooper told The Transcript agreements are identical "to provide certainty for their customers."

"To move away from that consistency for one community could have potential impacts across all the communities we serve," he said. "With a 25-year franchise agreement in place, OG&E can continue making long-term investments in Norman and the infrastructure that serves our customers in the area."

Cooper clarified that the lack of a franchise agreements slows down operations.

"With a franchise agreement in place, OG&E has access to rights-of-way and easements to make immediate repairs to equipment in those areas if they are damaged in a storm," he said. "Without a franchise agreement in place, OG&E likely would not have quick access to equipment in rights-of-way and easements because we likely would have to go through whatever processes are in place in a community to gain the necessary permits and orders to access easements or rights-of-way."

Despite the lapsed — and voter-declined — agreement in place, the company has continued to operate on the expired agreement in cooperation with the city.

Another issue OG&E officials addressed Monday was the reason the provider didn't bury more power lines. Huckabay said it does bury power lines in new construction areas, but to do so in older neighborhoods or commercial districts, would mean a "very cost prohibitive" retro fit.

OG&E's presentation indicated that it sells its power to the Southwest Power Pool which is then sold back to the company for lower rates than it could produce alone. The rate is 8.27 cents per kilowatt hour, compared to the national average of 11.5 cents per kilowatt hour, with new data finding the rates are 20% lower than average and 17% below Texas' rates.

Rate payers across the state have complained that rates skyrocketed following Winter Storm Uri, and in Norman, commented on local community Facebook pages that they would not support a franchise election.

Meanwhile, Oklahoma Attorney General Gentner Drummond announced he is hiring legal counsel to assist with possible litigation to explore whether utility companies were price gouged by suppliers during the storm.

Cooper welcomed the news and said OG&E was forced to purchase fuel at the prices required.

"We fully support that effort to force any market manipulators to pay for taking advantage of Oklahomans in a time of crisis," he said. "The attorney general said electric companies like OG&E and other utilities did not manipulate the market and that we had a moral and legal duty to purchase fuel during the storm for our customers. His comments were echoed by former Sec. of Energy Ken Wagner, Corporation Commission Chairman Todd Hiett, and Corporation Commission Vice Chairwoman Kim David."

Cooper said they know "customers are frustrated about the long-term impact of the cost of fuel to provide electricity during Winter Storm Uri" and applauded the state attorney's interest in the case.

Mindy Wood covers City Hall news and notable lawsuits for The Transcript. Reach her at mwood@normantranscript.com or 405-416-4420.