Demand for electricity is rising throughout the nation and is growing quickly across Oklahoma.
That issue was the focus of a nearly two-hour discussion and presentation June 18 by representatives of the Southwest Power Pool (SPP), Public Service Co. of Oklahoma (PSO), Oklahoma Gas & Electric Co. (OG&E), and the Oklahoma Corporation Commission, which regulates electric utilities.
“Energy demands are growing,” said Paul Suskie, an executive vice president with the SPP. “We’re facing resource adequacy challenges.”
The Southwest Power Pool is a regional transmission organization that manages the electric grid and wholesale power market for 14 states in the central U.S. Those include all of Oklahoma and Kansas and portions of Texas, Missouri, North and South Dakota, Louisiana, Iowa, Nebraska, Minnesota and Montana, along with electric providers in Arizona, Colorado, Wyoming and in Tacoma, Washington.
Suskie said the power pool is seeing large load demands growing to varying levels and it presents big challenges for the grid. “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. In addition, data centers are being proposed throughout Oklahoma: Luther, a Google data center in Stillwater, and the latest is Chickasha, although the Chickasha project is a “behind the meter” plan where the proposed data center would be powered with electricity from a nearby natural- gas fired power plant.
With increased demand, some states have resorted to “load shedding.”
That is a protective method of emergency power control where, during a large imbalance between supply and demand, the demand (load) is intentionally disconnected (“shed”) so that the available electricity supply can meet the remaining demand, thereby preventing a cascading collapse of the power grid.
Load shedding had the attention of the SPP executive as well as Corporation Commissioners who recalled such events occurred recently in Louisiana and New Mexico. California’s Pacific Gas & Electric imposed “rolling blackouts” a few years ago.
Two of Oklahoma’s largest utilities, OG&E and PSO, shared the same concerns about future demands for electrical power – and by future, they weren’t referring to 25 or 30 years from now.
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 conversation with the state regulators.
PSO is focused on preventing load shed events and has a five-year Integrated Resource Plan that ties closely with SPP Resource Adequacy. “We’re in constant communication with the Southwest Power Pool to ensure the accuracy of real-time production.”
Horeled said PSO is facing “huge numbers” for power demand and the company has seen more than 2,000 Letters of Agreement from applicants requesting more than 2,000 megawatts of “new load.” The applicants are new or expanding customers “who are already investing in engineering and site development,” he said.
“There are millions of dollars in these projects, some as big as $10 million,” Horeled said, adding that PSO is approaching a 50% increase in power demand. The time frame is to have the electricity supplied by 2028 and 2029, he said. PSO exec: ‘Need to start planning now’ “We need to start planning now,” he added, pointing to the recently announced $4 billion aluminum smelting plant at the Port of Inola, which is located in PSO’s service territory. It likely will mean PSO will be back before the commission asking for more approval of increased rates in the coming year.
PSO serves 575,800 customers (residential, commercial, industrial, and “other”) in 232 cities and towns in eastern and southwestern Oklahoma, including Lawton, Altus, Duncan, Cache, Elgin, Fletcher, Porter Hill, Sterling, Apache, Cement, Cyril and Frederick.
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 whatever we can to help and improve things,” Commissioner Brian Bingman replied.
Oklahoma Gas & Electric faces the same demands, and Brad Cochran, a senior manager, told commissioners the utility is looking at demand growth of 1,000, 2,000 and 3,000 megawatts. He said OG&E’s expected load in the next three to five years “could easily double.”
“There’s just more and more demand,” Cochran said.
The Corporation Commission’s own staff in the Public Utility 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 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, OG&E 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, OG&E projects a 20% increase in need by 2030 and PSO is at nearly 60%.”
“We absolutely want to protect ratepayers,” Commissioner Kim David said. “But we also want to get the power when we need it. There’s huge growth coming and it’s unprecedented.”