OGE Energy Corp. plans to file a rate case in Oklahoma by the fourth quarter of 2018 to recover investments in two power plants, company executives said Feb. 22.
The investments by Oklahoma Gas and Electric Co. consist of the scrubbers at the Sooner plant and the conversion to natural gas of coal-fired units at the Muskogee plant.
The company is investing $542 million, including allowance for funds used during construction, for the scrubber project. The first scrubber unit is expected to be in service by the end of the second quarter of 2018.
In its proposal, OGE Energy will be using a test year ending September 2018, with the aim of having the rates implemented by mid-2019.
The company also plans to submit its first formula rate filing in Arkansas on Oct. 1 to recover costs associated with the construction of new gas-fired units at its Mustang Energy Center.
A rate case on the Mustang recovery is already pending before the Oklahoma Corporation Commission.
According to CFO Stephen Merrill, the Sooner and Mustang investments are close to $1 billion, and the projects are on schedule and under budget.
"[T]he utility is coming to the conclusion of the largest investment program in our history, and 2017 was the largest single year in that program," Merrill said on the company's earnings conference call.
OGE projects capital expenditures of $625 million in 2018, including $420 million for transmission, distribution and generation. The remaining $205 million is for the company's projects like the scrubbers and the natural gas conversion.
OGE Energy reported net income of $294.8 million, or $1.48 per share, in the 2017 fourth quarter, climbing from $57.9 million, or 29 cents per share, in the same quarter of 2016. The company is targeting full-year 2018 EPS in the range of $1.90 to $2.05.