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Good economics in Oklahoma

A new trend in utility ownership of wind farms in the US gathered strength last month when the Oklahoma Corporation Commission approved a request by Oklahoma Gas & Electric Services (OG&E) to construct the 120 MW Centennial Wind Farm in Harper County in the northwest of the state. Invenergy Wind of Chicago will install 80 turbines at an estimated cost of $200 million and OG&E will sell the new project's electric output exclusively to its own customers through a subscription program for the life of the facility.

"We're almost certain they'll be GE turbines," says OG&E's Brian Alford. "And we hope to have the project online by year end. We have probably 3000 wind customers on a waiting list from the end of 2005 when our last subscription program sold out."

That program, started in 2003, was a product of the 50 MW Oklahoma Wind Energy Center near Woodward, Oklahoma, a project built, owned and operated by FPL Energy. Since then, OG&E reviewed the market for purchasing wind energy and determined that owning and operating the new wind farm would be a more cost-effective solution. "For us it was a matter of gaining some history with a wind project before we wanted to become an owner and operator," says Alford. "After three years in a power purchase agreement with FPL, we're in a much better position."

Alford says the economics of wind plant ownership also make much better sense in today's market. "Three years ago it wasn't economically beneficial," he says. "But now, with the experience and the price of wind coming down, we've been better able to gather the knowledge and put it together. We wanted to become comfortable with the operational issues and be sure our customers weren't unnecessarily exposed to risk."

Alford says that on average the company's current wind subscribers are paying $18-22 dollars less a month than other electricity customers. "Our customers are seeing tremendous benefit from wind and we're excited at the prospect of getting this new project going," he says. "Demand for renewable energy is definitely here and wind power is something we're going to continue to look at in the future."

OG&E is a regulated utility with 750,000 customers in an Oklahoma and western Arkansas service area that spans 30,000 square miles. The company is headquartered in Oklahoma City and owned by OGE Energy Corp, which also owns Enogex, a natural gas pipeline business operating mainly in Oklahoma.

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