WHO PAYS FOR THE POWER? PSO RATE HIKE, $250 MILLION DATA-CENTER LAWSUIT, AND BILLION-DOLLAR TRANSMISSION PROJECT RAISE QUESTIONS

Three major developments involving American Electric Power place new attention on electric rates, industrial growth, and the future of Northeast Oklahoma's power grid.

By Miami News-Digest | November 6, 2026

NORTHEAST OKLAHOMA — A $250 million lawsuit involving proposed data centers, a newly approved residential electricity rate increase, and a major transmission project crossing four Northeast Oklahoma counties are raising questions about the financial relationship between large industrial electricity users, public utilities, and the customers who ultimately pay for electrical infrastructure.

At the center of these developments is American Electric Power (AEP), the parent company of Public Service Company of Oklahoma (PSO) and AEP Oklahoma Transmission Company.

Although the three matters involve different proceedings and financial arrangements, they intersect through the same regional power system, corporate ownership, and regulatory questions concerning how the costs of expanding electrical infrastructure are distributed.

For Northeast Oklahoma residents, the central question is straightforward: Who will ultimately pay for the infrastructure needed to support the region's growing electricity demands?

PSO RESIDENTIAL CUSTOMERS FACE HIGHER RATES

On November 5, the Oklahoma Corporation Commission voted 2–1 to approve a 3.55% residential rate increase for PSO customers.

The increase follows the company's original request for an approximately 15% increase and a negotiated settlement that would have reduced the residential increase to approximately 1%.

That settlement, supported by PSO, the Oklahoma Attorney General's Office, AARP, and the commission's Public Utility Division, was ultimately rejected.

Commissioners Brian Bingman and Todd Hiett voted to approve the final order, while Commission Chair Kim David dissented.

The precise monthly impact on residential bills had not been finalized as of November 6. Customers have already been paying interim charges since July, meaning the newly approved percentage should not be interpreted as an additional 3.55% on top of those temporary rates.

Of particular importance was a disagreement over PSO's proposed expansion of its transmission cost-recovery mechanism.

Such mechanisms allow utilities to recover specified infrastructure expenses through customer bills, sometimes outside the traditional process of reviewing a company's overall rates.

Bingman and Hiett opposed expanding the mechanism, expressing concern that additional transmission investments should receive greater scrutiny.

The commission's decision therefore carries implications beyond the immediate rate increase. As electricity demand expands, additional infrastructure investments could become the subjects of future cost-recovery proceedings.

$250 MILLION LAWSUIT EXPOSES DATA-CENTER POWER DISPUTE

Meanwhile, a Texas development company has filed a lawsuit against PSO alleging unfair treatment involving two proposed Oklahoma data centers.

Central Southwest Texas Development claims approximately $250 million in losses associated with Project Waterfall in Oologah and Project Snowflake in Sperry.

According to reporting by FOX23 News, the developer alleges that PSO delayed the process of securing electrical service while making arrangements with a competing development identified as Project Clydesdale.

The lawsuit further alleges that PSO sought property easements benefiting the competing project and subsequently issued pre-condemnation notices concerning property associated with the developer's plans.

PSO disputes the accusations.

"We strongly disagree with these allegations and intend to respond through the appropriate legal process," the utility told FOX23.

The allegations have not been established by a court, and the $250 million represents claimed losses rather than an awarded judgment.

Nevertheless, the dispute illustrates the increasingly consequential role of utilities in determining how major industrial developments obtain access to electrical capacity.

Modern data centers, particularly those supporting artificial intelligence and large-scale computing, can require enormous amounts of electricity. Meeting that demand may involve new substations, high-voltage transmission improvements, generation resources, and other infrastructure.

Oklahoma has adopted safeguards intended to prevent certain costs associated with major new electricity customers from being shifted unfairly onto existing residential customers. The November 5 PSO rate order also includes provisions establishing separate terms for large electricity users, including data centers.

Whether those safeguards will adequately address future regional transmission costs remains an important question.

There is currently no established evidence connecting the allegations in the data-center lawsuit directly to the proposed Northeast Oklahoma transmission project.

A BILLION-DOLLAR TRANSMISSION EXPANSION

The third development involves the Northeast Oklahoma Transmission Enhancement Project, commonly called NEOTEP.

AEP Oklahoma Transmission Company is seeking authorization to construct approximately 100 miles of new 345-kilovolt transmission infrastructure across Washington, Nowata, Craig, and Ottawa counties.

The Oklahoma construction represents portions of a larger transmission expansion extending through Kansas, Oklahoma, and Missouri.

Southwest Power Pool, the regional organization responsible for coordinating transmission planning and grid reliability, identified the improvements through its 2024 planning process.

The original planning estimates placed three connected transmission segments at approximately $992.5 million combined, including $484.1 million for the Buffalo Flats-to-Delaware segment, $342.6 million for the Delaware-to-Monett segment, and $165.8 million for the Monett-to-North Branson extension.

Those figures describe the larger interstate expansion, not a $1 billion construction expenditure confined to Oklahoma. They also represent earlier planning estimates rather than verified final construction costs.

AEP maintains that the project is necessary to reduce transmission congestion, improve regional reliability, strengthen the grid against severe winter weather, and accommodate future electricity demand.

Construction in Oklahoma is currently projected to begin in 2028, with completion expected in late 2029.

Opponents, including the organization Protect Rural Oklahoma, question whether the proposed route adequately protects agricultural property, rural communities, and landowners whose property could be affected by permanent utility easements.

According to AEP's project information, transmission structures could reach approximately 100 to 135 feet in height, with typical rights-of-way measuring approximately 150 feet across.

The company says its route-selection process has included discussions with landowners, local communities, and Tribal Nations.

WHO WILL PAY FOR NEOTEP?

This is where the financial questions become particularly important.

Under Southwest Power Pool's established transmission cost-allocation methodology, qualifying high-voltage transmission facilities operating at 300 kilovolts or higher have their approved costs distributed regionally.

Because NEOTEP is designed as a 345-kilovolt project, its eligible transmission costs are expected to be shared across the regional power system rather than assigned exclusively to the Oklahoma counties through which the line passes.

In practical terms, AEP's transmission business finances and constructs its assigned infrastructure. Eligible investments can subsequently be recovered through federally regulated transmission charges, including an authorized return on the investment.

Those expenses are paid through the regional electricity system and can ultimately become part of the costs recovered from utility customers.

Consequently, Oklahoma electricity consumers may pay a portion of the transmission project's costs even though the infrastructure is intended to serve broader regional needs.

AEP acknowledges that major transmission projects are funded regionally and that costs are recovered over decades. The company maintains that this approach spreads expenses among millions of customers while limiting the impact on individual household bills.

However, a specific projected cost for the average Oklahoma residential customer has not been established in the materials reviewed.

Just as importantly, the evidence does not establish that NEOTEP construction costs are included in the 3.55% residential increase approved November 5.

These distinctions are important when evaluating the financial relationship between the two developments.

CONNECTING THE DOTS

The connections among these developments are not necessarily evidence of improper conduct. They do, however, demonstrate how utility financing, industrial development, and residential electricity costs can overlap.

PSO and AEP Oklahoma Transmission Company operate as separate legal entities within the same corporate family. One supplies electricity to customers, while the other develops and owns transmission infrastructure.

That arrangement creates different regulated revenue streams associated with delivering electricity and maintaining the transmission network.

As data centers and other major industrial facilities seek increasing amounts of electrical capacity, the regional grid may require additional investment.

Those investments can improve reliability and benefit existing communities, but their financing also raises questions about whether costs are being allocated appropriately among residential customers, commercial businesses, and major industrial electricity users.

The transmission project was identified through regional reliability studies, and no direct causal relationship has been established between NEOTEP and the Oologah or Sperry data-center developments.

Nevertheless, examining the demand forecasts used to justify major infrastructure projects, the financial benefits received by the utility owners, and the costs ultimately recovered from consumers is a legitimate matter of public interest.

The issue is particularly relevant to residents who could face both increased utility expenses and the physical effects of new transmission infrastructure crossing privately owned property.

PUBLIC COMMENT HEARING MONDAY IN OKLAHOMA CITY

Residents concerned about the proposed NEOTEP route will have an opportunity to address the Oklahoma Corporation Commission on Monday, November 9.

The public-comment session for NEOTEP West is scheduled for 9 a.m. at the Concourse Theatre, Suite C50, in the Will Rogers Memorial Office Building, 2401 N. Lincoln Boulevard, Oklahoma City.

Protect Rural Oklahoma is encouraging residents and affected landowners to attend. The organization opposes the proposed transmission route and has organized community participation in the regulatory proceedings.

The commission lists the NEOTEP West proceeding under case number PUD 2026-000047, with a formal hearing scheduled for November 13.

NEOTEP East is being considered separately under case number PUD 2026-000068.

Public comments can also be submitted through the commission's official participation procedures.

A QUESTION OF PUBLIC ACCOUNTABILITY

As Oklahoma considers expanding its transmission infrastructure to meet future electrical needs, the distinction between corporate investment and customer expense deserves careful examination.

AEP and PSO maintain that infrastructure investment is necessary to support reliability, economic development, and a growing electrical system. Opponents argue that the consequences for property owners, agricultural communities, and ratepayers require closer scrutiny.

Both the immediate costs and the long-term benefits must be considered.

For Northeast Oklahoma residents, several questions remain unanswered: How much of NEOTEP's total cost will eventually be allocated to Oklahoma electric customers? How much of the projected demand comes from existing communities rather than future industrial development? What financial safeguards prevent major industrial projects from shifting their infrastructure expenses onto households? And what measurable reliability improvements will Northeast Oklahoma communities receive?

The answers will require examination of Southwest Power Pool planning studies, AEP transmission revenue requirements, Oklahoma Corporation Commission filings, and the rate structures governing large industrial customers.

Ultimately, the central issue is not simply who builds the power lines, but who benefits from them, who bears their costs, and how those decisions are made.

As regulators prepare to hear from the public Monday, those questions are likely to remain central to the debate over the future of Northeast Oklahoma's electrical grid.

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Miami News-Digest

Real People, Real News & Entertainment.

Additional information: Oklahoma Corporation Commission — oklahoma.gov/occ | AEP NEOTEP — aeptransmission.com/oklahoma/neotep/ | Protect Rural Oklahoma — protectruralok.com