Retail Unbundling - Oklahoma

Status: The state has no unbundled service programs for residential customers but is considering action.

Overview: In January 1998, the Oklahoma Corporation Commission adopted rules for competitive bidding of natural gas services both before (upstream) and after (downstream) the city gate (the delivery point to local distribution companies (LDCs)). These rules required all LDCs with 25,000 or more customers to file a plan for unbundling of all services by April 1998, with plans by smaller utilities due a year later. The original schedule called for retail gas competition to begin by October 1999. However, this date was extended until June 2005 owing to a number of unsettled issues such as capacity reallocation, tax, and municipal franchise issues. In July 1999, the commission approved a plan in which the state's largest LDC, Oklahoma Natural Gas (ONG), with about 75 percent of the residential and commercial markets, would put its gas supply and transportation requirements out for competitive bidding, while its storage and gathering assets would be removed from utility regulation. ONG has an unusual role in that it is not only the largest LDC in the state but also the major gas supplier through its intrastate pipeline and storage and gathering services.

EIA State Data: In 2001, Oklahoma had 868,314 residential and 79,687 commercial customers. They consumed 65 and 42 billion cubic feet of natural gas, respectively. The average prices paid for natural gas purchased by residential and commercial customers were $9.58 and $8.83 per thousand cubic feet, respectively. The average city gate price in the state was $6.48 per thousand cubic feet.

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File last modified: 01/31/2003