This gas company wants to charge customers a $1,400 “exit fee” for switching to electric
Oklahoma Natural Gas is pioneering new ways to force people to use fossil fuels.
Most of us want to encourage others to ditch fossil fuels whenever possible. Of course, most of us aren’t natural gas executives. Oklahoma Natural Gas, which serves nearly 1 million customers across the state, would like to keep people hooked up to its service, and it has a novel idea for how to do that: Charge an absurdly expensive “exit fee.”
According to a report from HuffPost, Oklahoma Natural Gas has proposed charging $1,400 to disconnect a customer’s gas services, including stoves and heating systems, so they can switch to electric.
Ostensibly, the massive fee is a means for Oklahoma Natural Gas to pay back its considerable debt, which hit racked up during the uncommonly cold winter that hit the state last year. During those spells of freezing temperatures, demand for heat spiked — and so did the cost of providing it. In order to cover those expenses and continue providing service, utility companies had to borrow massive amounts of funds. Oklahoma Natural Gas reportedly paid $1.5 billion to cover these costs.
The thing is, much of this debt has already been addressed. Earlier this year, Oklahoma legislators passed a law allowing utility companies to convert their debt into public bonds, which allowed the companies to spread out the excess costs incurred, giving them more time to pay debts back.
Of course, the companies then turned around and charged their customers 50% more per month on their utility bill — right in the middle of one of the worst utility debt crises the country has seen. According to the National Energy Assistance Directors’ Association, there is an estimated $28 billion in unpaid utility bills across the country, with as much as 20% of U.S. households at least 60 days behind on their gas or electric bills. So if the utility companies couldn’t muster up the money to pay their bills (and they probably could, given all the bailouts made available to them by the federal government), the citizens of Oklahoma sure as hell couldn’t, either.
In order to pay back that debt, Oklahoma Natural Gas has to keep its customers around. Hence the exit fee. And it is targeting electric because that is what many people are jumping ship to adopt. Gas stoves and heating systems not only require burning fossil fuels to function, but they also contribute to air pollution. Meanwhile, electric alternatives cook more evenly, are more energy-efficient, and are increasingly more affordable.
Part of this exit fee proposal is coming almost certainly out of spite — a shameless attempt to keep folks from making the move from electric. Oklahoma is something of a leader in the “locking people into fossil fuels” business. It passed one of the first laws preventing cities and communities within its borders from banning new gas hookups in order to encourage the adoption of electric alternatives. It should come as no shock that the state is once again at the cutting edge of fossil fuel protectionism.