Last month the Oklahoma Corporation Commission approved Oklahoma Gas & Electric’s Positive Energy smart grid program.

After closely evaluating the utility’s application, the OCC found this smart grid technology to be a prudent investment — preapproving up to $366.4 million in program costs to construct the system.

Here’s some information about where that money is coming from, and how it will be handled…

Funding sources for OG&E’s program include a $130 million stimulus grant from the US Department of Energy’s Smart Grid Investment grant program. Also, Oklahoma ratepayers will be expected to cover $220 million of the program costs via a three-year smart grid recovery rider (SGRR), which the OCC approved.

Although Oklahoma ratepayers will be funding this program through the rider, both the OCC and OG&E project that over the life of this investment consumer savings will exceed total investment costs.

OG&E says its smart grid network will save up to $20 million per year in system-wide operation and maintenance expenses, plus $8 million in annual meter reading costs. These savings will be passed through to ratepayers — as will the costs.

Oklahoma consumers also will save money on their utility bills by taking action to reduce consumption, time-shift usage, or implement other energy efficiencies in response to information obtained from the new smart meter equipment.

Further utility cost recovery will be addressed in OG&E’s next scheduled rate case in 2013. In that proceeding, funds from the approved rider must be reconciled. To facilitate this, the commission has ordered the establishment of three regulatory assets:

• A smart grid operations and maintenance account.
• A stranded meter cost account.
• A web portal account.

OCC’s action follows regulatory approval of of major smart meter rollouts by public utility commissions in California, Texas, Oregon, Idaho, Pennsylvania, Maine, Delaware, and elsewhere. The Aug. 13 Maryland PSC approval of BGE’s smart meter program was only one of many.