American Electric Power isn’t trimming its sails on its plan to buy three under-construction wind farms covering north-Central Oklahoma.
Officials at the utility, parent of Public Service Co. of Oklahoma, said it remains committed to pursuing the plan despite Texas regulators’ recent decision to not approve a cost-recovery mechanism for the utility in that state.
“We are disappointed that our customers in Texas will not be able to benefit from the low-cost wind energy the north central projects will provide,” Nicholas K. Akins, AEP’s CEO, stated as part of a recent release. “The regulatory approvals we have received in Arkansas, Louisiana, Oklahoma and at the Federal Energy Regulatory Commission will allow us to move ahead with the north central wind projects at full scale, saving our customers in those states approximately $3 billion over the next 30 years.”
As an American Electric Power subsidiary, PSO pursued and obtained a cost recovery approval from the Oklahoma Corporation Commission.
Another subsidiary, Southwestern Electric Power, obtained cost recovery mechanism approvals involving its customers in Arkansas and in Louisiana.
American Electric Power and its subsidiaries are investing about $2 billion to acquire the farms, which will have the capacity to generate nearly 1.5 gigawatts of energy.
The projects, being built across parts of Alfalfa, Blaine, Custer, Garfield, Kingfisher, Major and Woods counties, are expected to be completed over the course of the next two years.
PSO’s portion of the deal enables it to acquire 675 megawatts of that energy for $908 million, while SWEPCO and wholesale customers will acquire and use the rest.
PSO, which serves more than 550,000 customers in eastern and southwestern Oklahoma, projects those customers will save more than $1 billion in electric costs over the next three decades, thanks to the acquisition.
Customers first will achieve savings through federal production tax credits the utility will receive as part of its deal to acquire its share of ownership in the three wind farms.
It projects its customers will benefit later through reduced costs to generate electricity using the wind farms, compared with using natural gas or coal.
While PSO buys power from numerous wind farms, these are the first it will co-own.
“With our careful selection of these facilities, we get a great price, great wind velocity and we are able to tie this into our system without the need for an immediate line, and hopefully none ever,” Matthew A. Horeled, PSO’s regulatory and finance vice president, previously told commissioners.
Akins, meanwhile, stated in the recent release the projects will help both subsidiaries’ customers and the communities where the farms are getting built.
“As we transition to a clean energy future, our investment in the north central wind projects supports economic and business development in our communities and will help our customers meet their renewable energy goals.”