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HOUSE OF REPRESENTATIVES - FLOOR VERSION
STATE OF OKLAHOMA
1st Session of the 60th Legislature (2025)
COMMITTEE SUBSTITUTE
FOR
HOUSE BILL NO. 1737 By: Moore
COMMITTEE SUBSTITUTE
[ Natural Gas Utility Infrastructure Cost Recovery
Act of 2025 - cost recovery rules - cost assessment
request - promulgation of certain rules –
codification - effective date ]
BE IT ENACTED BY THE PEOPLE OF THE STATE OF OKLAHOMA:
SECTION 1. NEW LAW A new section of law to be codified
in the Oklahoma Statutes as Section 810 of Title 17, unless there is
created a duplication in numbering, reads as follows:
This act shall be known and may be cited as the "Natural Gas
Utility Infrastructure Cost Recovery Act of 2025".
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SECTION 2. NEW LAW A new section of law to be codified
in the Oklahoma Statutes as Section 811 of Title 17, unless there is
created a duplication in numbering, reads as follows:
A. As used in this section:
1. "Energy Infrastructure Facility" refers to any physical
asset or system involved in the production, processing, storage,
transportation, distribution, or delivery of energy by a natural gas
utility, including renewable natural gas (RNG), hydrogen, other
alternative fuels, and emerging technologies such as carbon capture
and sequestration; and
2. "Public interest" is defined as including, but not limited
to, projects that enhance energy reliability and energy security,
promote economic development and job creation, increase systemwide
capacity, accelerate the commercialization of advanced emerging
technologies, or provide environmental benefits.
B. A natural gas utility subject to rate regulation by the
Corporation Commission may elect to file an application seeking pre-
approval by the Commission to construct or invest in an energy
infrastructure facility, to purchase an energy infrastructure
facility, to construct or invest in an interconnect for the purposes
of connecting its system to an energy infrastructure facility, or
enter into a contract for purchased gas supply or engage in fuel
generation, including renewable natural gas (RNG), hydrogen, or
other alternative fuels as well as transportation capacity, fuel
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storage, or other infrastructure and technologies that support
system innovation, subject to the provisions of this section. If,
and to the extent that, the Commission determines that the future
construction or purchase of the energy infrastructure facility or
gas supply contract serves the public interest, the facility or
contract shall be considered used and useful and its costs shall be
subject to cost recovery rules promulgated by the Commission. Any
costs that exceed the amount approved by the Commission by more than
ten percent (10%), shall be subject to prudency review as part of
the utility's next general rate filing. The Commission shall enter
an order on an application filed pursuant to this subsection within
two hundred forty (240) days of the filing of the application,
following notice and hearing.
C. Following receipt of an application filed pursuant to this
section, the Corporation Commission staff may file a request to
assess the specific costs, to be paid by the natural gas utility and
which shall be deemed to be recoverable, for the costs associated
with conducting the analysis or investigation of the application
including, but not limited to, the cost of acquiring expert
witnesses, consultants, and analytical services. The request shall
be filed at and heard by the Corporation Commissioners in the docket
opened by the natural gas utility pursuant to this section. After
notice and hearing, the Commission shall decide the request.
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D. Additionally, following receipt of an application filed
pursuant to this section, the Office of the Attorney General may
file a request with the Corporation Commission for the assessment of
specific costs, to be paid by the natural gas utility and which
shall be deemed to be recoverable, associated with the performance
of the Attorney General's duties as provided by law. Those costs
may include, but are not limited to, the cost of acquiring expert
witnesses, consultants and analytical services. The request shall
be filed at and heard by the Corporation Commissioners in the docket
opened by the natural gas utility pursuant to this section. After
notice and hearing, the Commission shall decide the request.
E. The Commission shall promulgate rules to implement the
provisions of this section. The rules shall be transmitted to the
Legislature on or before April 1, 2026. In promulgating rules to
implement the provisions of this section, the Commission shall
consider, among other things, rules which would:
1. Permit contemporaneous utility recovery from its customers,
the amount necessary to cover the Corporation Commission staff and
Attorney General assessments as authorized by this section;
2. Establish how the cost of facilities approved pursuant to
this section shall be timely reviewed, approved, and recovered or
disapproved; and
3. Establish the information which a natural gas utility shall
provide when filing an application pursuant to this section.
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F. The Commission shall also consider rules which may permit a
natural gas utility to begin to recover return on or return of
Construction-Work-In-Progress expenses prior to commercial operation
of a newly constructed energy infrastructure facility.
SECTION 3. This act shall become effective November 1, 2025.
COMMITTEE REPORT BY: COMMITTEE ON RULES, dated 03/05/2025 - DO PASS,
As Amended.