News from the Oklahoma Corporation Commission

Matt Skinner, Public Information Officer

Phone: (405) 521-4180, FAX: (405) 522-1623, www.occeweb.com

February 8, 2001

COMMISSIONERS RESPOND TO CONCERNS, MISUNDERSTANDINGS OF LAWMAKERS

Expressing concern that misinformation and evident misunderstandings will place an even greater burden on struggling consumers, Oklahoma Corporation Commissioners are offering to speak with State Representative Mike Mass, and State Representative Randall Erwin on their concerns regarding the high price of natural gas and the Commission’s handling of the situation.

Commission Vice-Chair Denise Bode, a member of the Bush energy transition team, pointed out this complex problem requires a united effort. "This is not just an Oklahoma issue. This is part of a national crisis. Rather than pointing fingers, it’s more important to be part of a solution and work to solve the problem. This Commission has worked, and continues to work very hard to do everything we can to assist ratepayers in Oklahoma."

Commissioner Apple planned to speak with both lawmakers personally.

"I welcome their wisdom in resolving the problem of high gas prices, which is, of course, a national problem. If there is a legislative solution to this, I would support it wholeheartedly. I for one do not want to go into a second heating season without having asked all the questions I can. However, it should be made clear this is a national issue that goes to the wellhead. The supply and demand issue is not a myth. Also, as a former state legislator and as a Commissioner, I have no doubts this entire Commission has been diligent and responsible in fulfilling our duty to the people of Oklahoma using our authority under the law."

Responding to the request by the lawmakers that the Federal Energy Regulatory Commission (FERC) investigate their various concerns, the Commissioners said they would welcome FERC input.

"I have worked closely with FERC for some 20 years," said Bode. "I certainly respect their expertise."

While stressing this is a complex problem, Commissioners do want to make it clear that:

 

 

 

(page 2, Response)

· The Commission ordered a $20,000,000 annual cut in ONG’s rates last May.

· The national demand for natural gas has increased drastically, while production, until very recently, declined, the victim of an uncaring federal bureaucracy that let our domestic producers go broke. The amount of gas in the ground isn’t at issue. Getting it out is the issue.

· The Commission has taken its role to "monitor and oversee" the price charged by utilities for its gas very seriously, so much so that it recently changed the formula of the "pass-through" costs so as to lower the price borne by ONG customers. However, state law is very clear: A utility can pass on to the consumer, at no profit, what it had to pay for gas. The Commission has been and will continue to closely monitor the purchase practices of the utilities in an on-going review.

· The Commission has been, and will be, actively investigating the issue of gas storage by the utilities.

· Because of the competitive bidding requirements contained in the unbundling rules the price Oklahomans are paying for natural gas is lower than it otherwise would be.

OCC

All news releases and advisories are available for review and downloading on the OCC Web site at www.occeweb.com