Demand for electricity. It’s reported nationwide and is growing quickly across Oklahoma and was the focus Wednesday of a nearly two-hour discussion and presentation by representatives of the Southwest Power Pool, Public Service Company of Oklahoma, Oklahoma Gas and Electric Company and the Corporation Commission.
“Energy demands are growing,” explained Paul Suskie, an Executive Vice President with the SPP. “We’re facing resource adequacy challenges.”
He said the power pool is seeing large load demands growing to varying levels and it presents big challenges for the grid of which Oklahoma is one of 14 states as members.
“Going forward, we have to meet the challenges,” he said as he cited increased requests for new power loads.
What’s behind the demand? Industrial growth. Data centers. Artificial Intelligence. It has the attention of Corporation Commissioners and their staff as they handle increasing numbers of requests for rate hikes to meet the demand for more electricity.
Proposed new data centers are popping up all over the U.S. and as part of the SPP, Oklahoma will have to provide electricity to other states in need of generated electricity. Plus, data centers are being proposed throughout Oklahoma. Luther. Stillwater and the latest is Chickasha, although the Chickasha project is a “behind the meter” plan where the data center would produce its own electricity through a gas-powered plant.
With increased demands, some states have seen the process of load shedding, where grids have to dump power in order to avoid largescale blackouts. It had the attention of the SPP executive as well as Corporation Commissioners who recalled such events occurred recently in Louisiana and New Mexico.
Two of Oklahoma’s largest utilities, OG&E and PSO shared the same concerns about the future demands for electrical power and by future, they’re not referring to 25 or 30 years.
Matthew Horeled, vice president of regulatory and finance at PSO was blunt.
“The demand is increasing exponentially,” he said not once, but twice in his discussion with the state regulators.
PSO is focused on preventing the load shed events and has a 5-year Integrated Resource Plan which ties closely with SPP Resource Adequacy.
“We’re in constant communication with the SPP to ensure the accuracy of real time production.”
Horeled said PSO is facing “huge, huge numbers” for power demand and the company has seen more than 2,000 Letters of Agreement asking for more electricity.
“There are millions and millions of dollars in these projects, some as big as $10 million,” he said, adding that PSO is approaching a 50% increase in demands. The time frame is to have the power supplied by 2028 and 2029.
“We need to start planning now,” he added, pointing to the recently announced $4 billion aluminum smeltering plant at the Port of Inola which is located in the PSO service territory. It will likely mean PSO will be back before the commission asking for more approval of increased rates in the coming year.
PSO is encouraging the Corporation Commission to assist in three categories: move at the speed of business, encourage new generation and protect Oklahoma’s affordability and reliability.
“We’ll do what ever we can to help and improve things,” responded Commissioner Brian Bingman.
Oklahoma Gas and Electric faces the same demands and Brad Cochran, a Senior Manager, told commissioners the utility is looking at growth of 1,000, 2,000 and 3,000 megawatts demand. He said OGE’s expected load in the next three to five years “could easily double.”
“There’s just more and more demand,” said Cochran.
The Commission’s own staff at the Public Utilities Division faces the same challenges.
“It’s a new era and there are new problems. It will take work to find solutions” said PUD Director Mark Argenbright.
One of the challenges is AI or Artificial Intelligence which requires up to 10 times more electricity.
“Staggering,” he said. “It makes significant regulatory challenges.”
Commissioner Todd Hiett said he shared the same concerns as those pointed out by the SPP, PSO, OGE and PUD.
“We have to try to prevent overbuilding and at the same time project total load. It will be very difficult in the coming years and could be at a great cost to ratepayers. Just today, OGE projects 20% increase in need by 2030 and PSO is at nearly 60%.”
“We absolutely want to protect ratepayers,” commented Commissioner Kim David. “But we also want to get the power when we need it. There’s a huge growth coming and it’s unprecedented.”
