AG Asks FERC to Ensure Corporate Tax Savings Are Passed On to Customers

Oklahoma Attorney General Mike Hunter is asking federal regulators to pass along new corporate tax savings to utility customers.

In a Jan. 19 letter to the Federal Energy Regulatory Commission, Hunter urged the commission law to make sure corporate tax savings from the new law result in utility savings for customers. The corporate income tax rate was dropped from 35 percent to 21 percent.

“Taking action has special importance for retail utility customers in Oklahoma because many FERC-regulated utilities’ wholesale rates are simply passed on to Oklahoma customers by their state-regulated retail utilities,” wrote the Attorney General.

The letter is similar to the action he recommended recently to the Oklahoma Corporation Commission.

“Without prompt action, retail customers will continue paying rates that include excessive, unjust and unreasonable wholesale electricity transmission and gas transportation rates, which they have been paying since the (Tax) Act became effective on Jan. 1,” wrote Hunter.

He said two actions are necessary to protect the interests of consumers. One is lowering the rates as quickly as possible to reflect the lower corporate income tax rates. The other is to track all excess accumulated deferred income tax and other tax savings “so that they can ultimately be refunded, with interest, to customers.”

Most electric utilities in the state relay on transmission service that is regulated by FERC.

“We are asking the commissioners at the FERC to stand behind the agency’s mission to assist consumers in obtaining reliable, sustainable energy at reasonable costs,” Attorney General Hunter said. “The corporate tax cuts have created a dividend for major corporations that should be passed on to customers. We implore the commissioners to act quickly by doing their part at the wholesale level.”

If FERC goes along with a reduction in rates, it would ultimately result in reduced rates paid by Oklahoma utility customers.