Anthony Berates Panel's Agreement
by Ray Tuttle
The Tulsa World - February 12, 1997
Corporation Commission vice chairman Bob Anthony on Tuesday called
last month's Oklahoma Gas & Electric Co. rate settlement "arbitrary" and
"capricious," and said it would not stand up if contested in court.
In January, all three Corporation Commissioners -- Anthony, Cody Graves and
Ed Apple -- approved the OG&E rate settlement that had been hammered out a
month earlier. The rate reduction awarded OG&E customers an 8.1 percent rate
reduction in their summer electric bills.
The reduction, to take effect March 1, will be $ 50.7 million this year and
$ 55.7 million in 1998 and 1999 -- for a total of $ 162 million. It will cut
residential rates $ 20.7 million, an average of $ 7.65 a month for customers
from June through October.
But in a concurring opinion filed Tuesday with the written order, Anthony
said the settlement could be found unlawful if challenged.
"During proceedings, I advised the parties of my concern that the record
needed to meet certain legal requirements for a commission dealing with a
'black box settlement. '" "Black box" refers to negotiated settlements
behind closed doors where no record is kept. The Legislature mandated
utilities work out rate cases in such a manner. Anthony cited legal opinions
from Kansas and Missouri rate cases that called the black box settlements
"However, I concur in accepting the rate decrease ordered herein because it
will benefit the ratepayers of OG&E and the economy of Oklahoma. Yet, I
regret that larger benefits may have been possible upon a more thorough
presentation of evidence. "
Anthony could not be reached for further comment.
Graves said negotiated settlements and resulting stipulations were designed
not to go on record.
"The parties agree to have no record. The fact is OG&E and the commission
started this rate case nearly $ 100 million apart, yet came to a settlement
in which 13 of the 16 participating parties signed. "
Graves, commission chairman, called Anthony's action "duplicitous at best
and disingenuous at worst. "
OG&E spokesman Grant Ringel said the utility was "very encouraged that the
settlement was accepted on a 3-0 vote. "
"We think it is a good settlement -- good for our customers in Oklahoma and
fair to the company. "
The Oklahoma City-based electric utility, the state's largest serving
625,000 in Oklahoma and western Arkansas, filed the rate reduction because
it wanted to pass along savings, in the form of lower bills, realized from
operating efficiencies accomplished over the past two years, Ringel said.
About 538,000, or 86 percent, are residential customers.
© 1997 The Tulsa World
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