OG&E Electric Services, Public Service Company of Oklahoma and the Oklahoma Municipal Power Authority have announced that each of the parties in the proposed construction of the 950MW Red Rock generating unit has agreed to terminate agreements to build and operate the plant.
The announcement followed the Oklahoma Corporation Commission’s issuance of an order verifying the Commission’s verbal decision in September to deny pre-approval for construction of the Red Rock facility. In the order, the commission indicated that both Public Service Company of Oklahoma (PSO) and Oklahoma Gas and Electric (OG&E) will need more electric generating capacity in the next few years, but also asserted that not enough consideration was given to solutions other than Red Rock.
Pete Delaney, OGE Energy’s chairman, president and CEO, said: We continue to believe that a jointly owned Red Rock plant represented a unique opportunity for three Oklahoma utilities to maintain a balanced generation portfolio and hold down future energy costs. Unfortunately, as we said consistently throughout this process, it is not feasible to construct a plant of this size without the Commission’s blessing. We will now turn our attention to developing alternative, albeit less attractive, baseload generation options.
OG&E estimates its share of costs in the planning phase of the Red Rock project to be between $18 million and $20 million. The company intends to seek regulatory recovery of those costs.