Three power contracts for wind energy for Public Service Co. of Oklahoma should be approved by the Oklahoma Corporation Commission, an administrative law judge recommended Thursday.
The Tulsa-based utility announced in October it will purchase almost 600 megawatts of electricity from three wind farms to be built near Seiling in northwest Oklahoma and Balko and Goodwell in the Panhandle.
PSO wants permission from the commission to recover costs associated with the wind contracts starting in 2016 from the fuel-cost adjustment portion of customer bills. The utility typically adjusts its fuel costs in the fall of each year.
Administrative Law Judge James Myles' recommendation to approve PSO's wind contracts will go before the three-person Corporation Commission for its final decision.
PSO issued a request for proposal in June to replace an expiring, 151-megawatt contract with Blue Canyon II wind farm near Lawton. The utility received 18 bids totaling almost 3,000 megawatts.
Because of the number of bids and the low prices for wind power, PSO decided to sign contracts for 600 megawatts. The utility also wanted to secure the contracts before the Dec. 31 expiration of the federal wind production tax credit.
Independent evaluators for the attorney general's office and the commission's public utility division testified Thursday they thought the bid process and contract negotiations were fair and in the best interest of PSO's customers.
Several groups sometimes at odds with PSO said they were happy with the wind contracts, including Oklahoma Industrial Energy Consumers (OIEC) and the Quality of Service Coalition.
PSO estimated the agreements would reduce its costs by $53 million in the first year, with annual savings growing over the 20-year length of the contracts. The utility has about 540,000 customers in southwestern and eastern Oklahoma.
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