News from the Oklahoma Corporation Commission

Jim Palmer, Director of Information

May 20, 1999

FOR IMMEDIATE RELEASE:

BODE TESTIFIES BEFORE CONGRESSIONAL SUBCOMMITTEE ON GOVERNMENT ROLES IN ELECTRICITY COMPETITION

Addressing the House subcommittee on Energy and Power in the nation’s capitol on Thursday, May 20, Commissioner Denise Bode noted that as we look to restructure the electricity industry it is important to look outside of "the box" and consider energy as a whole. Bode pointed to Oklahoma’s promulgation of new rules this year to restructure the natural gas industry and bring competition and choice to consumers. She said Oklahoma is the third largest gas producing state in the nation, yet we only use 30% of what we produce.

Bode said a key issue in Oklahoma’s electricity restructuring is the state’s low cost for electricity. That cost is as much as 50% lower than such states as California and Pennsylvania and 19% below the national average.

With low cost an issue, Bode cited the need "to move cautiously to be sure Oklahomans are better off as a result of competition." This issue has been identified by study groups as the Oklahoma Corporation Commission (OCC) participates in the study of electricity restructuring with the Oklahoma legislature’s Joint Electric Utility Task Force. The Task Force study is being done under the state’s legislative mandate to restructure electricity in Oklahoma by July 1, 2002.

Bode said "in Oklahoma and elsewhere in the country, competition in the electric marketplace is coming." The Commissioner said "it is important to manage the restructuring in a steady and careful fashion."

Bode called for establishing clear and consistent regional transmission policies. The Commissioner’s testimony called for the removal of barriers in current law. Bode asked Congress to "repeal the Public Utilities Regulatory Act (PURPA). The Public Utility Holding Company Act (PUHCA) should be changed to reflect today’s market structure and allow a more competitive model to develop." Bode said "Rural Utilities Service (RUS) policies must change to allow rural electric cooperatives to successfully transition to competitive markets."

Commissioner Bode told subcommittee members that "removing barriers may not

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BODE TESTIFIES (Cont’d)…page 2

be enough. Congress must also consider ways to enhance the development of

competitive electric markets." Bode urged Congress "to resist the temptation to impose its own views by mandating set asides of fuel choice on the market place." Emphasizing that Oklahoma is a low cost electricity state, Bode said "states should be allowed to manage the opening up of their markets to competition because a cookie cutter approach by the federal government won’t work."

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Interviews with Commissioner Bode in Washington may be arranged through Kevin Knutson at 405-521-2267.