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OK Attorney General investigates market manipulation after 2021 winter storm

Posted at 3:16 PM, Jul 18, 2023

OKLAHOMA CITY, Okla. — The 2021 winter storm, that devastated parts of the country, is the center of an investigation by Oklahoma’s Attorney General. Gentner Drummond says some companies used the storm to rake in billions of dollars through market manipulation. During a news conference Tuesday, Drummond said legal action will be necessary to recover that money for Oklahoma ratepayers.

“Bringing with it ice, snow, record setting cold temperatures, it was among the most brutal winter storms in history,” said Oklahoma Attorney General Gentner Drummond. “Here in Oklahoma, families and businesses suffered greatly and they are still suffering paying the price of higher utility rates."

Across the country, the storm caused hundreds of deaths and $200 billion in damages. Here in Oklahoma, Attorney General Gentner Drummond says some entities wrongfully made billions of dollars off the disaster.

“The magnitude of this scheme is staggering and unconscionable,” said Drummond. “The conduct in question is well outside the boundaries of ordinary capitalism.”

Just about everyone has seen price hikes on their utility bill as we pay back fuel costs from the winter storm.

Drummond says the oil and gas industry and power companies in Oklahoma are not to blame.

“I do not find any evidence that they benefited untowardly,” said Drummond. “They simply bought at the market because they had a duty to buy at the market.”

Drummond says, his office’s investigation pinpointed some natural gas marketers as the problem. They arrange the purchases and sales of natural gas, and Drummond says some of them manipulated supply so they could charge exponentially more when demand increased due to the storm.

“I will do everything in my power, as Attorney General, to return what was taken and to hold accountable those responsible,” said Drummond.

We appreciate Attorney General Drummond’s thorough review of possible market manipulation during Winter Storm Uri. We support any effort by the Attorney General to claw back costs charged to OG&E and its customers by any natural gas marketers who he finds exploited the situation and return those funds to customers. The Oklahoma Corporation Commission has found OG&E’s 2021 operations and costs from Winter Storm Uri to be reasonable and prudent. Uri was a once-in-a-generation winter storm, and we are proud that we preserved customer health and safety by keeping the heat and lights on. To protect our customers from natural gas price volatility to the extent we can, OG&E continues to source fuel at the lowest available cost for our customers.
Shortly after joining the OCC, I formally asked Attorney General Gentner Drummond to investigate possible market manipulation by natural gas marketers during Winter Storm Uri. I appreciate today’s announcement by the Attorney General concluding that market manipulation most likely occurred by certain natural gas marketers during Winter Storm Uri to artificially increase the price of natural gas. Additionally, I am thankful for confirmation that no wrong-doing was done by the Corporation Commission, Oklahoma’s regulated utilities, or the producers of oil and gas. Importantly, the Attorney General confirmed what I have known all along, that the OCC lacks the authority to investigate these marketers and his office is capably handing this matter. While today’s announcement is only the first step towards holding these marketers accountable for their actions, it is my hope that all determined overpayments be returned to Oklahoma ratepayers.
Oklahoma Corporation Commissioner Kim David

Attorney General Drummond’s intention to take potential legal action over alleged market manipulation during Winter Storm Uri is welcome news for utility customers and AARP members in Oklahoma. Frustrated utility customers are demanding to know why they are paying for a “once-in-a-generation” storm for decades. The companies who reaped billions of dollars on the backs on hard-working Oklahomans must be held accountable. Oklahoma utility customers want action to be taken against the companies who bilked customers out of billions of dollars in a matter of days during Winter Storm Uri and further demand the recovered funds are returned to customers immediately.
AARP Oklahoma State Director Sean Voskuhl

Drummond says they’re looking for outside counsel who specializes in mass tort claims to help with the lawsuit. The Attorney General’s Office is soliciting proposals. Drummond says the search for an outside firm should take about 10 days. He says ultimately, he’d like to see lower prices for customers if they win.

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