Oklahoma City-based utility OG&E has announced a landmark agreement to provide electricity to three new Google data centers in Muskogee and Stillwater, Oklahoma, with contract terms structured to ensure current ratepayers do not bear the financial burden of connecting the large facilities to the grid.

The Agreement and Its Terms

OG&E, the operating subsidiary of OGE Energy Corp. (NYSE: OGE), announced the agreement. The deal covers Electric Service Agreements for three data center sites that Google announced in Muskogee and Stillwater last year.

Under the terms of the contract, Google has committed to paying 100% of the costs required to connect the data center sites to the electric grid, as well as all contracted costs, regardless of the company's actual energy use. Google will also pay its proportional share of the power generation capacity required to serve the facilities.

As part of the agreement, Google will make power generation capacity available from two solar facilities that are currently under construction, adding new generation resources to the grid.

The Electric Service Agreements and associated Capacity Purchase Agreements will be filed for review with the Oklahoma Corporation Commission in the coming days. The OCC must formally approve the agreement before OG&E can supply power to the data center sites.

Customer Protections at the Center of the Deal

OG&E officials described the agreement as a deliberate model for how utilities can accommodate large industrial electricity customers without shifting infrastructure costs onto residential and commercial ratepayers.

Sean Trauschke, Chairman, President, and CEO of OGE Energy Corp., said the agreement forms the basis for a new large-load tariff that OG&E plans to submit to regulators in the coming weeks.

"This unique agreement is a model for future data center partnerships and forms the basis for a new large-load tariff that OG&E will submit in the coming weeks that protects our current customers from bearing the costs of this growing demand and Oklahoma's goals for economic growth," Trauschke said.

The utility currently serves approximately 913,000 customers across Oklahoma and western Arkansas. OG&E stated that Oklahoma residential electricity rates are currently 19% below the regional average and 34% below the national average.

The company also noted that over the past decade, electricity demand on its system has grown by 25% while the pace of residential rate increases has remained substantially below the inflation rate.

Google's Perspective on the Partnership

Will Conkling, Director of Energy and Power for the Americas at Google, emphasized that the company views ratepayer protection as integral to its data center expansion strategy.

"Energy innovation and ratepayer protection go hand in hand in the communities where we operate data centers across Oklahoma and around the world," Conkling said.

"This landmark partnership with OG&E demonstrates our commitment to safeguarding affordability for our Stillwater and Muskogee neighbors, adding new generation resources to the grid while providing guaranteed upfront funding to cover the cost of building new infrastructure."

Google's data centers, according to OG&E, power services used by billions of people daily, including online banking platforms, hospital records systems, and 911 emergency services. Google is a subsidiary of Alphabet Inc.

State Officials Welcome the Investment

Oklahoma Governor Kevin Stitt issued a statement in support of the announcement, framing the agreement as consistent with the state's broader economic development strategy and its commitment to maintaining low energy costs.

"Oklahoma's abundant and reliable energy supply positions the state as a trusted partner for companies, like Google, to make long-term investments that diversify and bolster our economy," Stitt said.

"With any new infrastructure developments, Oklahoma is committed to keeping energy costs low for families and small businesses. OG&E's contract with Google reflects that ongoing commitment while continuing to support Oklahoma's competitive edge for job creation."

Grid Stability and Economic Growth

OG&E characterized the data centers and their associated agreements as beneficial not only to local communities in Muskogee and Stillwater but also to overall grid stability.

The utility said the arrangement contributes to economic growth for the state while avoiding the kind of cost-shifting that has drawn scrutiny in other markets where large data center customers have rapidly expanded their grid footprint.

Trauschke framed the deal in the context of OG&E's long-term positioning as a low-cost electricity provider. "OG&E is pleased to support Google and together advance growth in our home state, ensuring our current customers benefit from data center expansion that meets the technology needs of the 21st-century economy at some of the lowest rates in the country," he said.

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