KGOU

More Companies Sign On To Wind Catcher Settlement

Jun 5, 2018

Four companies have agreed to support a proposed $4.5 billion wind power project. The Oklahoma Municipal Power Authority, Oneta Power LLC, South Central MCN and Tri-County Electric Cooperative reached an agreement with Public Service Co, or PSO, who announced the Wind Catcher project last summer. Wind Catcher could provide up to 2 gigawatts of electricity and could potentially be the largest wind farm in the country.

Journal Record senior reporter Sarah Terry-Cobo talks with Jacob McCleland about the project and why some companies and Oklahoma’s attorney general have concerns.

FULL TRANSCRIPT

Jacob McCleland: It’s the Business Intelligence Report, a weekly conversation about business news in Oklahoma. I'm Jacob McCleland. We’re talking with Sarah Terry-Cobo. She’s the senior reporter at the Journal Record newspaper. Sarah, thank you for joining us.

Sarah Terry-Cobo: Hi Jacob, thank you for having me, it’s great to be here.

McCleland: I want to talk today about the proposed Wind Catcher project. This could potentially be the largest wind farm in the nation. I want to get to the latest developments in just a minute, but first, Sarah, give us some background here. What’s the who, what, when are where on Wind Catcher?

Terry-Cobo: Public Service Company of Oklahoma announced this project last summer. The Wind Catcher project will have a capacity of 2,000 megawatts, or two gigawatts. The turbines are being built in the Panhandle and will transport power to the Tulsa region and to four neighboring states. There is also a dedicated, high-voltage transmission line being planned to take that all power, and it will be dedicated to avoid congestion, from all those other wind farms in the panhandle.

So PSO says the project will cost about $4.5 billion. Yes, that’s billion with a B. Oklahoma customers are only supposed to foot part of the bill and the company says people will save $2 billion due to federal tax credits.

McCleland: The project has its detractors, though, including Oklahoma Attorney General Mike Hunter. Why does Hunter’s office not like this project?

Terry-Cobo: It is in part how and what the company asked state regulators to do. So PSO asked the Corporation Commission to pre-approve the utility’s ability to recover costs from the project before it is up and running. So General Hunter says the company didn’t use competitive bidding, they have not shown a need to build more wind and they didn’t follow the law when they asked the Corporation Commission its application. So his staff estimate that customers base rates will rise by nearly 70 percent. He says customers need to be protected.

McCleland: What does PSO need to get approval for the wind project right now?

Terry-Cobo: Right, they don’t need regulatory approval to build it. They want regulators to promise that PSO can come back later and can raise customer’s bills to cover the project. Because they’re asking before the project has been put into service, that is why it is called preapproval.

McCleland: What are they at in that process right now?

Terry-Cobo: So they have already and have had hearings in front of a commission judge and the judge has issued her recommendation. Now they are waiting on the commissioners, there are three of them, to hold a final hearing, they’ve had a few hearings already, and to discuss whether or not the commissioners would deny or approve the project.

McCleland: We mentioned the state attorney general’s office earlier. Who else is opposed to Wind Catcher?

Terry-Cobo: Well let’s see, the Public Utility Division staff of the commission, Plains and Eastern, a division of Clean Line, that’s another large electric transmission company, another wind project developer, Novus Windpower, and at one point the Windfall Coalition, a group of people who are opposed to wind tax incentives.

McCleland: Just last week, four companies signed on in favor of Wind Catcher. What did those companies receive in exchange for their support?

Terry-Cobo: Yes, these were a couple of electric cooperatives, the Oklahoma Municipal Power Authority, a company called South Central MCN - they build transmission lines - and an independent power provider called Oneta Power. PSO agreed to buy about 300 megawatts of electricity generated by natural gas from Oneta. They promised they wouldn’t compete for customers in the territory of the co-ops. And they agreed that South Central could also build some transmission lines in the area that PSO would normally have a right to build and own.

McCleland: PSO also  has an agreement with Walmart. Why is that significant?

Terry-Cobo: Well Walmart is one of the largest commercial electricity customers in most areas, wherever you go. They actually led the way in creating the private proposed settlements with PSO. Walmart attorneys put pressure on PSO to guarantee caps on the cost of construction. They also made the utility agree that Oklahoma customers will get a deal that is at least as good as the customers in neighboring states.

McCleland: I was in the Panhandle recently, and people there were excited about this project, especially the jobs. What’s the potential economic impact of Wind Catcher?

Terry-Cobo: There are construction jobs for putting up all those towers and turbines, and that generally turns into economic development as those workers rent hotel rooms and eat at restaurants. There are landmen jobs for people to negotiate land lease payments for all that equipment that’s on people’s private property. And then once the project is built, there will be people who need to do maintenance on the turbines and the transmission lines, but we don’t have a final figure so to speak.

McCleland: Sarah Terry-Cobo is the Journal Record’s senior reporter. Sarah, thank you for your time.

Terry-Cobo: Absolutely, happy to do it, Jacob

McCleland: KGOU and the Journal Record collaborate each week on The Business Intelligence Report. You can find this conversation at kgou.org. You can also follow us on social media. We're on Facebook and Twitter, @journalrecord and @kgounews.

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