Legislation to address utility bill price spikes due to winter storm filed in Oklahoma Senate

Oklahoma Senate

The Oklahoma State Senate, pictured on March 28, 2018. (KFOR/Bill Miston)

OKLAHOMA CITY (KFOR) – Legislation was filed in the Oklahoma State Senate that seeks to help manage financial burdens brought on by higher utility bills caused by February’s winter storm.

Senate Bill 1049 and Senate Bill 1050 both allow utility customers to lower their monthly utility bill costs associated with the winter storm and stretch the time period for paying those costs, said Sen. James Leewright, R-Bristow, chair of the Senate’s Business, Labor and Commerce Committee, and chair of the Senate Select Committee created to study the winter storm-related increased utility costs.

“Doing nothing to help ratepayers manage that debt load is not an option. If we do nothing, families and seniors on fixed incomes could be faced with choosing between paying their February energy bill or paying for food and medicine,” Leewright said. “If we do nothing, small businesses could be forced to make layoffs or cutbacks to pay their energy bills. Securitization is the best path forward to help families manage the extreme costs related to the storm, and help small businesses manage the impact as they continue to recover from the pandemic.”

Legislation Highlights:

  • Securitization of debt allows ratepayers to spread repayment over a period of months and pay a smaller, monthly amount for the February energy costs rather than paying for February usage in one lump sum.
  • Does not increase bond indebtedness of the state or cause any harm to the state budget.
  • Provides many avenues of oversight of through timely audits, extensive vetting and analysis by several state entities, and requiring regular reporting to the executive and legislative branches.

Regulated Utility Consumer Protection Act:

  • Allows increased costs related to the February 2021 winter storm to be securitized via the issuance of bonds backed by ratepayer revenues, reducing the financial impact of extreme costs related to the winter storm.
    • Creates a property right based on the customer charges for the securitization, which guarantees the holder of the bond will be repaid.
  • Allows Oklahoma Development Finance Authority to issue ratepayer-backed bonds, and requires ODFA to report regularly on the bond activity until the debt is retired.
  • Requires ratepayer-backed bonds go through the Council of Bond Oversight review and get approval from the Attorney General’s Office and the Oklahoma Supreme Court.

Unregulated Consumer Protection Act

  • Provides for the issuance of loans made pursuant to notes, bonds, revenue bonds, or other forms of indebtedness to reduce for unregulated utility customers the extreme financial impact of costs related to the February 2021 winter storm.
  • Directs the ODFA to:
    • Receive and review applications for the determination of utility costs related to the February winter storm;
    • Issue written approval or disapproval of an unregulated utility’s application;
    • Issue bonds necessary to fund the Unregulated Utility Customer Protection Fund from which loans are issued; and
    • Issue loans to unregulated utilities for the amount approved in the application process.
  • Requires utility bonds issued to fund the loan program go through the Council of Bond Oversight review and authorizes ODFA to apply for approval of the bonds by the Oklahoma Supreme Court.
  • Requires reporting to the governor and legislative leaders on the status of loan applications, when a loan is issued to an unregulated utility, and provide regular updates to those leaders until the debt is retired.

Copyright 2021 Nexstar Media Inc. All rights reserved. This material may not be published, broadcast, rewritten, or redistributed.

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