Oklahoma Gas and Electric Co. laid out a plan to reduce demand for its electricity so it doesn't have to build a new power plant until at least 2020, the utility told regulators on Tuesday.
OG&E may add more renewable energy, most likely wind generation, by 2014. It also plans to install emissions-control equipment to deal with several federal environmental regulations. But OG&E wants to hold off on the most expensive emissions controls for its coal plants until legal reviews are complete.
The utility presented its integrated resource plan at a public meeting before the Oklahoma Corporation Commission in Oklahoma City. The plan, which is not binding, has to be submitted every three years to regulators.
Leon Howell, OG&E's director of resource planning, said the plan is a snapshot of how the utility will deal with future customer needs in several areas, including generation, transmission and environmental regulations.
“Demand response is very important to our 2020 goal going forward,” Howell said.
Smart meters used
OG&E said the installation of smart meters and Smart Hours, a variable-pricing program for peak-demand times, will help lower daily customer demand. The utility forecasts daily system demand of 5,864 megawatts in 2020, a reduction of more than 500 megawatts. Most of the reduction would come from expiring wholesale power contracts OG&E has with other utilities.
The utility said it will issue a request for information next year to see if additional wind capacity would be affordable for its customers. OG&E added wind power last year with its 227 megawatt Crossroads project in Dewey County. It will add another 60 megawatts later this year when it begins buying power from a NextEra Energy Resources wind farm near Blackwell.
Shifting to natural gas
Coal generated 59 percent of OG&E's electricity in 2011, with another 35 percent coming from natural gas. Wind provided the remaining 6 percent. The utility expects to shift most of its generation to natural gas by 2042, when it will make up almost two-thirds of OG&E's energy mix.
Jim Roth, an attorney representing Chesapeake Energy Corp., commended the utility for moving toward natural gas for more of its future generation. But he urged OG&E to explore recent commission rules that make it easier for utilities to buy natural gas on long-term contracts.