Edmond Officials Concerned About Impact of Proposed Legislation
House Bill 1739 Could Mean Higher Electric Rates for Some Residents
Edmond city officials are among those that oppose Oklahoma House Bill 1739 by Representative Rob Johnson which would allow OG&E to expand its service area into Edmond Electric's system. If passed, the legislation could allow the investor-owned utility to use the city's rights of way without compensation and without allowing Edmond residents the right to vote on who uses their rights of way.
Oklahoma Municipal Power Authority (OMPA), the Municipal Electric Systems of Oklahoma (MESO) and the Oklahoma Municipal League also oppose the proposed legislation.
The area in which OG&E is seeking to expand its service is the high-growth area along Interstate 35. This includes significant frontage along the interstate where a convention center, shopping center and hotels are projected to be located. The area, which was annexed in 1976, was one of the last areas to be annexed by the City of Edmond.
Prior to the annexation, OG&E provided limited service in that area. That prior service is their basis for wanting to expand into the area that is now projected for significant residential and commercial development over the next 20 years.
Over the past 30 years, the City of Edmond has invested millions of dollars to expand the utility's infrastructure along and east of Interstate 35. In doing so, Edmond paid hundreds of thousands of dollars for rights of way. House Bill 1739 could allow OG&E to use the rights of way without compensating the City of Edmond.
Edmond officials believe the city's electric utility is best suited to serve the residents of Edmond. In the recent ice storm, Edmond Electric's customers had their service restored several days in advance of some customers served by investor-owned utilities.
Edmond Electric has been recognized nationally for outstanding service reliability. The current reliability rating is 99.99%. For 13 consecutive years, the city's electric utility has reported a reliability rating at or higher than 99.97%.
The city's electric utility transfers over $5 million dollars from its proceeds to the City of Edmond's General Fund. This ongoing transfer is one of the reasons that sales tax rates in Edmond are less than many other metro-area cities.
A bill comparison for 2007 conducted by OMPA showed that an average residential Edmond Electric customer paid over 10% less for the same electric usage by an OG&E customer in another city.
"This bill would result in assigned territories, meaning increased electric rates for those Edmond residents in the OG&E service area," said Nancy Nichols, Director of Governmental Relations for the City of Edmond. "There is nothing in the legislation that would increase consumer protection or reduce rates."
Edmond officials are working to provide information to the State's legislators because the investor-owned utilities, such as OG&E, and the Rural Electric Cooperatives are encouraging legislators to vote for the bill.
"It would take away our citizens' constitutional right to vote regarding who uses municipal right of way," Nichols said.
"We believe that constitutional right outweighs the rights of investor-owned utilities who are seeking to increase their revenue by expanding into a growing service territory."
Issued: March 07, 2008
