BLOG: Citing Ratepayer Risk, Texas Regulators Reject Wind Proposal

The proposed wind generators are to be in Oklahoma, but can supply adjoining states.

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A proposal to add 810 megawatts of wind energy that would serve customers in East Texas along with customers in other states has received a thumbs down by the Texas Public Utility Commission.

However, the full project will proceed in Arkansas and Louisiana, where regulators already have given regulatory approval. The project sponsor is Southwestern Electric Power Company, also known as SWEPCO, an American Electric Power Company.

In rejecting the plans last week, the Texas PUC noted that SWEPCO had not established that its wind generation facilities would result in the probable lowering of costs to retail customers and that Texas already had met its renewable energy goals.  The proposed wind generators are to be constructed in Oklahoma, but can supply adjoining states. You can read more about the PUC’s findings in Docket 49737, on the agent’s website.

SWEPCO insisted its project would result in customers savings. It said that earlier approvals by the Arkansas Public Service Commission and Louisiana Public Service Commission included provisions to increase the number of megawatts allocated in those states should one state reject its proposal. “Today’s decision by the PUCT does not affect the project’s full viability,”  Malcolm Smoak, SWEPCO president and chief operating officer, said July 2.

The company’s wind plans include the acquisition of three wind facilities in north central Oklahoma — known as the North Central Energy Facilities — in conjunction with its sister company, Public Service Company of Oklahoma. SWEPCO will own 810 MW, or 54.5% of the 1,485-MW project with an investment of $1.01 billion. SWEPCO and PSO will acquire the projects at their completion over the next two years.

Second Setback for SWEPCO

This is not the first time the Texas PUC has pushed back on a major SWEPCO wind project. In 2018 the company failed to secure a key vote from the agency for its proposed 2,000-megawatt Wind Catcher Energy Connection that was to have included a major wind farm on 300,000 acres in the Oklahoma Panhandle plus a dedicated 360-mile power line.

The PUC’s three commissioners similarly questioned then the company’s calculations for offsetting savings. The agency’s 3-0 vote against SWEPCO in July of 2018 prompted the company to announce that earlier project’s cancellation.

SWEPCO serves more than 536,300 customers in three states, including 231,000 in northwest and central Louisiana, 185,500 in northeast Texas and the Texas Panhandle and 119,800 in western Arkansas.

— R.A. Dyer