Utilities will have greater flexibility to enter into long-term fuel contracts under rules approved by the Corporation Commission, a change that could ultimately benefit Oklahoma's natural gas
Utilities would still fall under rules for competitive bidding for fuel contracts. But contracts won't require pre-approval by the commission, which sometimes led to pro
In public comments on the proposed rules, Devon Energy Corp. said a recent fuel contract under the old rules lingered for 18 months before being withdrawn.
“Certainly multiple factors were involved in the withdrawal of the cause, but the fact remains that such delays are not acceptable to ensure an efficient natural gas market,” wrote William Whitsitt, Devon's executive vice president of public affairs. “In many instances, days or even hours may impact the ability of a company to complete a transaction.”
Under the new rules, the Corporation Commission retained the power to review long-term fuel contracts to make sure they are in the best interests of utility customers.
“We didn't have the flexibility before,” said Alan Decker, regulatory director for Public Service Co. of Oklahoma, which serves more than 527,000 customers. “The hope is that there will be more options for the fuel that we are able to obtain.”
Devon spokesman Tim Hartley said the rules will help make Oklahoma's natural gas market as efficient as possible. Utilities in several other states already buy Oklahoma-produced natural gas from Devon because their states allowed greater flexibility in long-term contracts.
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