No one can argue that Kingfisher County and most of Oklahoma fared better than nearly everywhere in the state of Texas in the unprecedented 11-day arctic cold front that left area residents in a deep freeze.

But now concerns are mounting as to the price to be paid to the state, to utilities and ultimately to customers as bills come due for wildly fluctuating power costs.

A Perfect Storm Developed

The Southwest Power Pool, which operates the massive electrical grid serving most of Oklahoma and 13 other states, was slammed with the perfect storm of peak demand and limited supply.

Iced over windmill blades and overcast skies took wind- and solar-generated power sources completely offline and the bitter cold created supply and pricing issues with natural gas.

Meanwhile, natural gas producers, processers and transporters were facing their own share of problems due to the extreme cold.

Kingfisher, whose company Neoinsulation manufactures and sells insulation products for the energy industry, described problems drastically low temperatures can create.

“The natural gas found in Oklahoma and Texas is mostly considered to be a `wet gas; meaning it has a lot of hydrates (moisture) in it,” he said.

“Because there are hydrates in the gas, the pipes, valves, vessels and tanks that support the transmission of gas are more susceptible to freezing,” he said.

“Once the pipes and valves freeze up, it stops the production, processing and transmission of the gas, thereby drastically reducing available supply during a time when demand is in full force.”

Cody Bannister, vice president of communications for the Petroleum Alliance, said the temperatures created brutal working conditions throughout the oil and gas industry “You have to credit the men and women who make up the oil and gas industry,” he said. “There are no snow days in the oilfield.

“Workers from every sector — production, transportation, processing and refining— were in the field in subfreezing temperatures to provide natural gas to Oklahomans when they needed it most.”

One natural gas production company employee who asked that neither he nor his company be identified told the Times & Free Press:

“We could write a book on the many issues we fought over the last 11 days (of extreme weather).

“We experienced so may issues that ‘old timers’ in my group had never faced.

From 400-barrel storage tanks with frozen bottoms to oil makeup lines that supplies lube oil to our caterpillar engines so cold the oil wouldn’t flow.”

As gas supplies tightened while demand skyrocketed, market prices increased dramatically.

“Prior to the storm, the spot price of natural gas was just under $3/MMBtu (per metric million British thermal unit),” Mecklenburg said. “During the peak demand, prices surged to nearly $1,000/MMBtu.”

The SPP and every utility was urging customers to conserve electricity and natural gas at the same time residents were turning on heat lamps, space heaters and other supplemental power sources to keep pipes from freezing.

When rolling blackouts became a possibility Feb. 15, Cimarron Electric Cooperative CEO Mark Snowden received tentative assurance from Western Fanners Electric Cooperative that the local coop would be spared, due to the number of energy industry assets powered by its system.

WFEC is a generation and transmission coop that serves electric coops in the western two-thirds of Oklahoma, including Cimarron.

However, when temperatures dipped to minus 12 overnight Monday, SPP initiated rolling blackouts Tuesday morning over its entire service area, determining which substations to turn off based on minute-to-minute analysis of usage patterns without consultation or notice to WFEC or Cimarron management.

In all, six of Cimarron’s 20 substations were powered off and back in a series of blackouts before the SPP announced just before 11 a.m. that blackouts were suspended until further notice.

Problems Compounded

Although the blackouts were limited both in duration and number, they impacted natural gas production and processing facilities across Cimarron’s grid at the very point when those facilities already were struggling to keep up with demand.

“We do not have one single circuit coming out of our substations that don’t have natural gas assets on them,” Snowden said. “It didn’t matter which substationor circuit they picked when the entire STACK footprint fits inside your coops nine-county service territory, it comes down to which circuit do you want to turn off? I am 100 % certain that all of them had natural gas assets on them.”

When a natural gas plant goes offline and compressors shut down, gas that normally would be moving through the pipelines has to be “flared,” or burned off to keep presure in the lines from building to a dangerous level.

Restarting compressors after power is restored also is a time-consuming process.

Power at What Price?

The good news is that blackouts were limited to a few hours Tuesday morning and did not have to be repeated.

Both WFEC and the Oklahoma Municipal Power Authority, which supplies power to the City of Kingfisher, were able to obtain sufficient natural gas to provide for their power needs — but at a premium price.

“I can tell you that though the price was very, very high for the natural gas going into them, WFEC’s natural gas plants never went offline and had all the fuel they needed to operate through the crisis.”

Kingfisher City Manager Dave Slezickey said that in the first week of the deep freeze, OMPA spent $75 million on natural gas, compared to $18 million spent in all of 2020.

The impact of that extra cost won’t hit customer bills until March. But February bills due out this weekend for Cimarron members will be considerably higher just because of increased usage, Snowden said.

“We won’t know the impact of the higher cost of fuel it took to keep the power on for likely a few more weeks and that cost won’t show up at Cimarron until mid-March on our next power bill we receive from WFEC,” Snowden said.

“Anyone who needs extra time or a payment plan to pay the balance of this upcoming bill, we are going to work with them.”

He added that, while the exact amount of fuel cost increases aren’t known at this time, “we will not let happen to our members what is going on in Texas. That is a complete mess. I hope our members aren’t watching that and thinking they are about to get $1,000 electric bills.”

“I’m hoping, that we will see relief measures before OMPA bills member communities for February consumption, and we’ll have a clear plan for March billing (February use) before the bills go out,” Slezickey said.

“We are hoping the state will get federal aid and use that to offset the natural gas prices.

“OMPA knows how much we spent on fuel, but market settlements for production haven’t settled yet, so OMPA doesn’t know what revenues are from generating.

“I think OMPA will have to pay their gas bill before seeing any relief.”

Slezickey said city staff will monitor customer bills and “if bills are going to be high for April, we will suspend automatic payments so no one’s bank account gets drained.

“We’ll work payment plans with our customers if needed, even if it means using some of our reserves to pay the bill to OMPA.”

On its website, Oklahoma Natural Gas told its customers that:

“We will work with every customer to help them find alternatives for paying their bill.

“There are a number of payment options and resources that we offer customers who are having financial difficulty. “While we don’t know the details of the impact from this winter storm yet, we will commit to doing what we can to help our customers.”

Government Response

Snowden said that Gov. Kevin Stitt said in a press conference Monday that the state may be in line for more federal funding to help residents cover their utility bills.

“The governor met with House and Senate leadership yesterday as well as Attorney General Mike Hunter to discuss ideas on protecting Oklahoma’s utility consumers immediately and addressing the improvements needed longterm to ensure reliable power service without ridiculous market price swings,” Rep. Mike Dobrinski told the Times & Free Press.

“All groups involved understand this was a historic weather event, but it illustrates we need to do better.”

“Our caucus was addressed by Hunter yesterday concerning utility service,” State Sen. Darcy Jech of Kingfisher said.

“He and his staff are meeting with several of the providers, retailers and producers to discuss usage, future rates, blackouts, interruptions, etc.

“In the Senate, a committee has been formed to review the whole situation how was the response, were citizens protected, how can we do better or be better prepared for a future situation.

“I expect the committee will be looking at the overall power grid as well.”

Jech added that “it appears that most utility customers will avoid some of the huge increases that some in Texas and other states may see.

“I expect at some point there will be higher than normal bills and depending on individual circumstances, I expect that providers will work with their customers.”