This regional electric utility plans to maintain low prices despite growing demand and constraints on supply.

After the most intense ice storm in recent memory struck Oklahoma on December 9, 2007, knocking down power lines and cutting off service to more than 640,000 customers, the Oklahoma Municipal Power Authority (OMPA) went into crisis management mode. While thousands of customers across the state were still without power more than a week later, OMPA restored power to its almost 2,000 affected customers within three to five days.

OMPA, a regional wholesaler of electricity to 35 Oklahoma municipalities, responded with aplomb to the crisis, with crews from its member utilities cooperating to restore power to those affected. Through its mutual aid program, OMPA members assist utilities that sustain physical damage from natural disasters with personnel, equipment, and materials.

Cindy Holman, who assumed the position of OMPA’s general manager in February 2007 after serving as director of operations and chief financial officer, recognizes the utility’s obligations to its customers—in this case, the cities and towns that rely on it to power their homes, schools, and businesses.

The organization’s goal, Holman said in OMPA’s January 2008 newsletter, is to provide not just reliable service during a crisis, but over the long haul, even as energy markets fluctuate, demand grows, and supply is limited by factors such as environmental regulation to global instability.

“OMPA believes coal-fueled plants are the best choice for new baseload generation to fuel the future growth of the economies of our member cities in Oklahoma while allowing the authority to remain a low-cost provider, as well as preventing over-reliance on natural gas for electricity generation,” Holman said.

“These highly efficient facilities will provide lower cost electricity than other sources available to us, helping us maintain our power supply diversity and some control on power costs through our ownership in the plants,” Holman said. “They will provide long-term benefits to our member customers.”

Diversified power supply
In 2007, OMPA signed agreements with the Southwestern Electric Power Company (SWEPCO) to purchase a share of a new clean-coal power plant to be constructed in Fulton, Ark. The 600-megawatt John W. Turk Jr. Power Plant will rely on ultra-supercritical low-sulfur coal technology to create fewer emissions while producing power cheaply and efficiently.

Given the difficult nature of garnering approval for the construction of new coal power plants, member communities of OMPA wrote letters of support to the Arkansas Public Service Commission urging support for approval of the plant’s construction, which the commission granted in November 2007 over the objections of a competitor power generator.

“This is a small but important step toward SWEPCO receiving full approval for the construction and operation of the plant,” Holman said in a letter to members in January 2008.

An Oklahoma agency had denied approval for the construction of a 950-megawatt clean coal power plant in 2007, from which OMPA was planning to purchase power, proving that dependence on limited sources and types of power generation is risky for a utility.

OMPA operates the gas-fueled Ponca City Power Plant, its first fully owned and initiated power supply project, and owns an interest in gas and lignite-fired power plants in Texas and Louisiana.

OMPA also owns and operates two powerful sources of renewable and clean power: the 29-megawatt Kaw Hydroelectric Plant located near Ponca City, Okla., which provides almost 14% of OMPA’s energy resources in a typical year, and the Oklahoma Wind Energy Center, the state’s first large-scale commercial wind energy project. OMPA purchases and transmits wind-generated electricity from 34 General Electric 1.5-megawatt turbines located northeast of Woodward, Okla.

“The authority seeks a balanced approach to power sources available to meet our members’ load growth needs,” Holman said.

Keeping competitive
As the energy industry grows more competitive through deregulation, the financial strength of OMPA depends on its ability to continue to provide reliable service to its municipal customers.

In 1995, OMPA established a Competitive Utility Program to certify its members under criteria for evaluating the operation of their electric utilities to make them better able to compete.

OMPA also supports it member utilities with informational updates on changes in the industry, including newsletters and regular training courses. By providing training to its members and their workers, OMPA improves reliability and safety.

Additionally, OMPA helps its customers to upgrade their transmission capabilities, OMPA ensures that they continue to operate efficiently and at low cost. OMPA provides some engineering services to its members, including distribution planning and technical assistance for improvements to the distribution system.

OMPA assists its members to improve the energy efficiency of their individual customers through government subsidized loans and rebates for approved energy-saving measures such as heat pumps, electric water heaters, insulation, programmable thermostats, and weather-stripping.

“The electricity industry, including OMPA, is facing growing loads, with additional base load generation becoming more difficult to acquire and escalating in cost,” said Roger Farrer, OMPA’s manager of energy services, in the authority’s January newsletter. “We believe that energy conservation is an area that OMPA and its members should address.”

Holman said OMPA will continue to be a leader in the Oklahoma energy supply industry, despite uncertainties in the marketplace.