Newspaper article THE JOURNAL RECORD

OG&E Negotiating with Cogenerator

Newspaper article THE JOURNAL RECORD

OG&E Negotiating with Cogenerator

Article excerpt

Declaring that electricity rates to be paid by Oklahoma Gas & Electric Co. to two cogeneration projects are too high, OG&E chairman James G. Harlow Jr. said Thursday the utility is negotiating with one cogenerator - Applied Energy Services Inc. of Arlington, Va. - to voluntarily lower their rates.

However, Tom Tribone, vice president of Applied Energy Services, said discussions between his company and OG&E and the community included not only the price of electricity, but also the expected doubling of Oklahoma coal production and the number of construction and permanent employees resulting from his plant's construction and operation.

"There was never any discussion of a reduction in prices - the only discussion concerning price was a change in the payment schedule," said Tribone.

The company has begun construction on a 300-megawatt cogeneration facility near Poteau in eastern Oklahoma. The company has a 32-year contract with OG&E for the utility to buy the electricity from Applied Energy Services.

"I think it's not fair at this point to say we've reached an agreement to lower our rates," said Tribone, the project director for the Shady Point facility when it was in the developmental planning stages.

The cogenerator wants to have the highest positive effect on Oklahoma's economy, he said.

The other cogeneration project in the state was developed by Oklahoma City-based Smith Cogeneration Inc. for the Firestone Inc. tire manufacturing plant in southwest Oklahoma City.

Smith's chairman, Don Smith, said he received a telephone call in April from Pat Ryan, OG&E executive vice president and chief operating officer, "saying our rates were too high. …

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