Pike Electric service trucks line up after a snow storm in February 2021 in Fort Worth, Texas. The Oklahoma attorney general is examining whether companies manipulated natural gas markets to profit handsomely from the weather event. (Photo by Ron Jenkins/Getty Images) (This image cannot be republished unless you have a subscription to Getty.)
OKLAHOMA CITY — The Oklahoma Attorney General’s Office has subpoenaed a state agency as part of an ongoing probe into “unlawful activity” related to price market manipulation during a weather emergency that saw energy prices soar to astronomical levels.
The Oklahoma Corporation Commission has 20 days to produce evidence related to Attorney General Gentner Drummond’s investigation into “unlawful restraint of trade or unlawful activity” linked to natural gas trading or purchasing during February 2021’s Winter Storm Uri.
“Attorney General Drummond promised Oklahomans he would do everything in his authority to hold accountable bad actors who raked in billions of dollars in ill-gotten gains,” the Attorney General’s Office said in a statement. “These efforts remain ongoing and will continue until proper relief for ratepayers is secured.”
According to documents obtained by Oklahoma Voice through a public records request, outside attorneys hired to represent the Attorney General’s Office in August indicated over a dozen entities could be culpable, though all names were redacted.
“These bad acts created the largest transfer of wealth in the history of the country,” attorney Alex Yaffe wrote in a letter introducing a proposed litigation strategy against “oil and gas distributors who took advantage of the storm.”
Large sections of the legal proposal were redacted, but Yaffe pledged to make Oklahomans whole and deter future violators “from similar conduct moving forward.”
During the two-week winter event, public utilities reported that natural gas prices spiked nearly 40,000%. As a result, Oklahoma consumers faced more than $4.5 billion in additional energy costs.
The state’s three largest public utilities — Oklahoma Natural Gas, OG&E and PSO — received permission from the Corporation Commission to securitize that debt by adding a monthly surcharge that will last almost three decades.
Drummond announced in July that he hoped to take action against companies involved in market manipulation or other unlawful conduct.
At the time, he said a review found that companies pocketed billions at the expense of Oklahomans. Although he has not specifically named any bad actor, he has said oil and gas companies and energy providers are not responsible.
Todd Hiett, Oklahoma Corporation Commission chair, said he welcomed the subpoena, which was first reported by The Oklahoman. Drummond requested communications involving the three elected members of the Corporation Commission, their staff and agency employees related to the Winter Storm Uri cost recovery.
“The Attorney General is the proper authority to investigate the actions of the unregulated markets that left the consumer, utilities, and state officials grappling with record high natural gas costs from Uri,” he said in a statement. “I am gratified he is taking this matter very seriously, and the OCC will do all it can to help.”
State Rep. Andy Fugate, D-Oklahoma City, has been an outspoken critic of the monthly surcharge.
He said he’s glad the AG’s Office is investigating.
“The AG’s Office among other things serves as the consumer advocate in the state of Oklahoma, and it’s good to see them doing their job in this area,” Fugate said.
According to a legal contract obtained by Oklahoma Voice, Drummond has agreed to pay the outside attorneys up to $50,000.
If legal action is pursued, attorneys would receive a percentage based on the recovery. The maximum they could receive is $50 million.
Staff writer Carmen Forman contributed to this report.
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