OGE Energy Q3 2026 net income rises to $316M
Nine-month net cash provided from operating activities was $894.1 million, compared with $752.3 million.
Sentiment and the balance of points
Rhea-AI Sentiment reads the wording of the document, how positive or negative its language is on a 1 to 5 scale. The balance of points shown with the takes weighs what the document actually discloses, so the two can disagree, for example when a trial that missed its main goal is described in upbeat language.
OGE Energy Corp. (OGE), the parent of Oklahoma Gas and Electric Company (OG&E), reported operating revenues of $1,182.8 million and net income of $316.2 million for the three months ended September 30, 2026, compared with $1,045.0 million and $231.3 million, respectively, a year earlier. Diluted earnings per average common share were $1.52, versus $1.14. OG&E’s separate statements reported quarterly net income of $320.9 million, compared with $242.9 million.
For the nine months ended September 30, 2026, OGE Energy reported operating revenues of $2,647.3 million and net income of $482.7 million, compared with $2,534.3 million and $401.5 million in 2025. Net cash provided from operating activities was $894.1 million, versus $752.3 million. Capital expenditures, less allowance for equity funds used during construction, were $768.0 million, compared with $752.7 million. OGE Energy’s long-term debt was $5,534.1 million on September 30, 2026, versus $5,369.2 million on December 31, 2025.
How this balance works
Rhea-AI gives every point it takes from this document a weight. Minor counts 1, Moderate 3 and Major 9, so one Major point outweighs several Minor ones. The bar adds up the weights on each side, and when neither side holds more than 65% of the total the balance reads Mixed.
It reads the document as published, with the same rules for every company, and it does not look at what the market expected or at how the stock traded, so a point can be objectively good on a day the stock falls.
Rhea-AI Sentiment measures something else, the tone of the wording.
Positive
- Moderate pointThird-quarter revenue rose to $1,182.8 million from $1,045.0 million in 2025.
- Moderate pointThird-quarter net income rose to $316.2 million from $231.3 million in 2025.
Negative
- None.
Filing Explained
At
Key Figures
Key Terms
regulatory assets financial
rate-regulated activities technical
Allowance for equity funds used during construction financial
SPP cost tracker under recoveries financial
FAQ
AI-generated questions and answers. How Rhea-AI works. Not financial advice.
How much revenue and net income did OGE report for the third quarter of 2026?
How much operating cash flow did OGE report through September 2026?
AI-generated analysis. How Rhea-AI works. Not financial advice.
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM
For the quarterly period ended
OR
For the transition period from _____to_____
Commission File Number |
Exact name of registrants as specified in their charters, address of principal executive offices and registrants' telephone number |
I.R.S. Employer Identification No. |
State or other jurisdiction of incorporation or organization:
Securities registered pursuant to Section 12(b) of the Act:
Registrant |
Title of each class |
Trading Symbol(s) |
Name of each exchange on which registered |
OGE Energy Corp. |
|||
Oklahoma Gas and Electric Company |
None |
N/A |
N/A |
Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.
OGE Energy Corp. ☑
Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files).
OGE Energy Corp. ☑
Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of "large accelerated filer," "accelerated filer," "smaller reporting company" and "emerging growth company" in Rule 12b-2 of the Exchange Act.
OGE Energy Corp. |
☑ |
Accelerated filer |
☐ |
Non-accelerated filer |
☐ |
Smaller reporting company |
Emerging growth company |
|||
Oklahoma Gas and Electric Company |
Large accelerated filer |
☐ |
Accelerated filer |
☐ |
☑ |
Smaller reporting company |
Emerging growth company |
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐
Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).
OGE Energy Corp. ☐ Yes
At September 30, 2026, there were
At September 30, 2026, there were
Oklahoma Gas and Electric Company meets the conditions set forth in General Instruction H(1)(a) and (b) of Form 10-Q and is therefore filing this form with the reduced disclosure format permitted by General Instruction H(2).
|
FORM 10-Q
FOR THE QUARTER ENDED SEPTEMBER 30, 2026
TABLE OF CONTENTS
|
Page |
GLOSSARY OF TERMS |
ii |
FILING FORMAT AND FORWARD-LOOKING STATEMENTS |
1 |
|
|
Part I - FINANCIAL INFORMATION |
|
Item 1. Financial Statements (Unaudited) |
3 |
OGE Energy Corp. Condensed Consolidated Financial Statements |
3 |
Oklahoma Gas and Electric Company Condensed Financial Statements |
9 |
Combined Notes to Condensed Financial Statements |
14 |
|
|
Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations |
32 |
|
|
Item 3. Quantitative and Qualitative Disclosures About Market Risk |
44 |
|
|
Item 4. Controls and Procedures |
44 |
|
|
Part II - OTHER INFORMATION |
|
Item 1. Legal Proceedings |
45 |
|
|
Item 1A. Risk Factors |
45 |
|
|
Item 2. Unregistered Sales of Equity Securities and Use of Proceeds |
45 |
|
|
Item 5. Other Information |
45 |
|
|
Item 6. Exhibits |
45 |
|
|
Signature |
46 |
i
GLOSSARY OF TERMS
The following is a glossary of frequently used abbreviations that are found throughout this Form 10-Q.
Abbreviation |
Definition |
2025 Form 10-K |
Annual Report on Form 10-K for the year ended December 31, 2025 |
Act 373 |
Arkansas Act 373, also known as the Generating Arkansas Jobs Act of 2025 |
ALJ |
Administrative Law Judge |
APSC |
Arkansas Public Service Commission |
ASU |
Financial Accounting Standards Board Accounting Standards Update |
CPA |
Capacity purchase agreement |
CO2 |
Carbon dioxide |
COVID-19 |
Novel Coronavirus disease |
CWIP |
Construction work in progress |
Dry Scrubber |
Dry flue gas desulfurization unit with spray dryer absorber |
EPA |
U.S. Environmental Protection Agency |
Federal Clean Water Act |
Federal Water Pollution Control Act of 1972, as amended |
FERC |
Federal Energy Regulatory Commission |
FIP |
Federal Implementation Program |
FSAs |
Forward equity sale agreements, entered into with Morgan Stanley & Co. LLC and JPMorgan Chase Bank, National Association, New York Branch on November 20 and 21, 2025 in conjunction with OGE Energy's November 2025 public equity offering |
GAAP |
Accounting principles generally accepted in the U.S. |
IRP |
Integrated Resource Plan |
kV |
Kilovolt |
LRE |
Load Responsible Entity |
MW |
Megawatt |
MWh |
Megawatt-hour |
NAAQS |
National Ambient Air Quality Standard |
NOX |
Nitrogen oxide |
OCC |
Oklahoma Corporation Commission |
ODEQ |
Oklahoma Department of Environmental Quality |
OG&E |
Oklahoma Gas and Electric Company, wholly-owned subsidiary of OGE Energy |
OGE Energy |
OGE Energy Corp., collectively with its subsidiaries, holding company and parent company of OG&E |
Other operations |
Other operations primarily includes the operations of the holding company, other energy-related investments and consolidating eliminations |
Pension Plan |
Qualified defined benefit retirement plan |
PISA |
Plant-in-service accounting, as allowed by Oklahoma Senate Bill 998, which established a regulatory asset to defer for recovery certain depreciation expense and return associated with qualified plant investments that are not classified as transmission or new generation |
PM |
Particulate matter |
Regional Haze |
The EPA's Regional Haze Rule |
Registrants |
OGE Energy and OG&E |
Restoration of Retirement Income Plan |
Supplemental retirement plan to the Pension Plan |
SIP |
State Implementation Plan |
SOFR |
Secured Overnight Financing Rate |
SPP |
Southwest Power Pool |
System sales |
Sales to OG&E's customers |
U.S. |
United States of America |
Winter Storm Uri |
Unprecedented, prolonged extreme cold weather event in February 2021 |
XLPL |
Extra Large Power and Light |
ii
FILING FORMAT
This combined Form 10-Q is separately filed by OGE Energy and OG&E. Information in this combined Form 10-Q relating to each individual Registrant is filed by such Registrant on its own behalf. OG&E makes no representation regarding information relating to any other companies affiliated with OGE Energy. Neither OGE Energy, nor any of OGE Energy's subsidiaries, other than OG&E, has any obligation in respect of OG&E's debt securities, and holders of such debt securities should not consider the financial resources or results of operations of OGE Energy nor any of OGE Energy's subsidiaries, other than OG&E (in relevant circumstances), in making a decision with respect to OG&E's debt securities. Similarly, none of OG&E nor any other subsidiary of OGE Energy has any obligation with respect to debt securities of OGE Energy. This combined Form 10-Q should be read in its entirety. No one section of this combined Form 10-Q deals with all aspects of the subject matter of this combined Form 10-Q.
FORWARD-LOOKING STATEMENTS
Except for the historical statements contained herein, the matters discussed within this Form 10-Q, including those matters discussed within "Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations," are forward-looking statements that are subject to certain risks, uncertainties and assumptions. Such forward-looking statements are intended to be identified in this document by the words "anticipate," "believe," "estimate," "expect," "forecast," "intend," "objective," "plan," "possible," "potential," "project," "target" and similar expressions. Actual results may vary materially from those expressed in forward-looking statements. In addition to the specific risk factors discussed within "Item 1A. Risk Factors" in the Registrants' 2025 Form 10-K and within "Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations" herein, factors that could cause actual results to differ materially from the forward-looking statements include, but are not limited to:
1
The Registrants undertake no obligation to publicly update or revise any forward-looking statements, whether as a result of new information, future events or otherwise.
2
PART I. FINANCIAL INFORMATION
Item 1. Financial Statements.
OGE ENERGY CORP.
CONDENSED CONSOLIDATED STATEMENTS OF INCOME
(Unaudited)
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Three Months Ended |
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Nine Months Ended |
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September 30, |
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September 30, |
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(In millions, except per share data) |
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2026 |
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2025 |
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2026 |
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2025 |
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OPERATING REVENUES |
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Revenues from contracts with customers |
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$ |
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$ |
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$ |
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$ |
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Other revenues |
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Operating revenues |
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FUEL, PURCHASED POWER AND DIRECT TRANSMISSION EXPENSE |
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OPERATING EXPENSES |
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Other operation and maintenance |
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Depreciation and amortization |
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Taxes other than income |
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Operating expenses |
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OPERATING INCOME |
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OTHER INCOME (EXPENSE) |
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Allowance for equity funds used during construction |
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Other net periodic benefit expense |
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( |
) |
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( |
) |
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( |
) |
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( |
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Other income |
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Other expense |
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( |
) |
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( |
) |
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( |
) |
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( |
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Net other income |
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INTEREST EXPENSE |
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Interest on long-term debt |
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Allowance for borrowed funds used during construction |
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( |
) |
|
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( |
) |
|
|
( |
) |
|
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( |
) |
Interest on short-term debt and other interest charges |
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( |
) |
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( |
) |
|
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||
Interest expense |
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INCOME BEFORE TAXES |
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INCOME TAX EXPENSE |
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NET INCOME |
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$ |
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$ |
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$ |
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$ |
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BASIC AVERAGE COMMON SHARES OUTSTANDING |
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DILUTED AVERAGE COMMON SHARES OUTSTANDING |
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BASIC EARNINGS PER AVERAGE COMMON SHARE |
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$ |
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$ |
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$ |
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$ |
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DILUTED EARNINGS PER AVERAGE COMMON SHARE |
|
$ |
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$ |
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$ |
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$ |
|
||||
The accompanying Combined Notes to Condensed Financial Statements are an integral part hereof.
3
OGE ENERGY CORP.
CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME
(Unaudited)
|
|
Three Months Ended |
|
|
Nine Months Ended |
|
||||||||||
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September 30, |
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September 30, |
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(In millions) |
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2026 |
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2025 |
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2026 |
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2025 |
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Net income |
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$ |
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$ |
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$ |
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$ |
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Other comprehensive income (loss), net of tax: |
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Pension Plan and Restoration of Retirement Income Plan: |
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Amortization of prior service cost, net of tax of $ |
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Amortization of deferred net loss, net of tax of $ |
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Postretirement benefit plans: |
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Amortization of deferred net gain, net of tax of $( |
|
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( |
) |
|
|
( |
) |
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( |
) |
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( |
) |
Other comprehensive income, net of tax |
|
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Comprehensive income |
|
$ |
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$ |
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$ |
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$ |
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||||
The accompanying Combined Notes to Condensed Financial Statements are an integral part hereof.
4
OGE ENERGY CORP.
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(Unaudited)
|
|
Nine Months Ended September 30, |
|
|||||
(In millions) |
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2026 |
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2025 |
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CASH FLOWS FROM OPERATING ACTIVITIES |
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Net income |
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$ |
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$ |
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Adjustments to reconcile net income to net cash provided from operating activities: |
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Depreciation and amortization |
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Deferred income taxes and other tax credits, net |
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Allowance for equity funds used during construction |
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( |
) |
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( |
) |
Stock-based compensation expense |
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Regulatory assets |
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( |
) |
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( |
) |
Regulatory liabilities |
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Other assets |
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( |
) |
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Other liabilities |
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( |
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Other |
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( |
) |
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Change in certain current assets and liabilities: |
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Accounts receivable and accrued unbilled revenues, net |
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( |
) |
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( |
) |
Income taxes receivable |
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( |
) |
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Fuel, materials and supplies inventories |
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( |
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Fuel recoveries |
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Other current assets |
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Accounts payable |
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( |
) |
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( |
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Other current liabilities |
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Net cash provided from operating activities |
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CASH FLOWS FROM INVESTING ACTIVITIES |
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Capital expenditures (less allowance for equity funds used during construction) |
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( |
) |
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( |
) |
Cost of removal and other |
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( |
) |
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( |
) |
Net cash used in investing activities |
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( |
) |
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( |
) |
CASH FLOWS FROM FINANCING ACTIVITIES |
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Proceeds from long-term debt |
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Payment of long-term debt |
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( |
) |
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( |
) |
Decrease in short-term debt |
|
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( |
) |
|
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( |
) |
Dividends paid on common stock |
|
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( |
) |
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( |
) |
Proceeds (costs) from issuance of common stock |
|
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||
Cash paid for employee equity-based compensation |
|
|
( |
) |
|
|
( |
) |
Net cash (used in) provided from financing activities |
|
|
( |
) |
|
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|
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NET CHANGE IN CASH AND CASH EQUIVALENTS |
|
|
|
|
|
( |
) |
|
CASH AND CASH EQUIVALENTS AT BEGINNING OF PERIOD |
|
|
|
|
|
|
||
CASH AND CASH EQUIVALENTS AT END OF PERIOD |
|
$ |
|
|
$ |
|
||
The accompanying Combined Notes to Condensed Financial Statements are an integral part hereof.
5
OGE ENERGY CORP.
CONDENSED CONSOLIDATED BALANCE SHEETS
(Unaudited)
|
|
September 30, |
|
|
December 31, |
|
||
(In millions) |
|
2026 |
|
|
2025 |
|
||
ASSETS |
|
|
|
|
|
|
||
CURRENT ASSETS |
|
|
|
|
|
|
||
Cash and cash equivalents |
|
$ |
|
|
$ |
|
||
Accounts receivable, less reserve of $ |
|
|
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Accrued unbilled revenues |
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Income taxes receivable |
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Fuel inventories |
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Materials and supplies, at average cost |
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Other |
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||
Total current assets |
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OTHER PROPERTY AND INVESTMENTS |
|
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Other |
|
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Total other property and investments |
|
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PROPERTY, PLANT AND EQUIPMENT |
|
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|
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In service |
|
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||
Construction work in progress |
|
|
|
|
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|
||
Total property, plant and equipment |
|
|
|
|
|
|
||
Less: accumulated depreciation |
|
|
|
|
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|
||
Net property, plant and equipment |
|
|
|
|
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|
||
DEFERRED CHARGES AND OTHER ASSETS |
|
|
|
|
|
|
||
Regulatory assets |
|
|
|
|
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|
||
Other |
|
|
|
|
|
|
||
Total deferred charges and other assets |
|
|
|
|
|
|
||
TOTAL ASSETS |
|
$ |
|
|
$ |
|
||
The accompanying Combined Notes to Condensed Financial Statements are an integral part hereof.
6
OGE ENERGY CORP.
CONDENSED CONSOLIDATED BALANCE SHEETS (Continued)
(Unaudited)
|
|
September 30, |
|
|
December 31, |
|
||
(In millions) |
|
2026 |
|
|
2025 |
|
||
LIABILITIES AND STOCKHOLDERS' EQUITY |
|
|
|
|
|
|
||
CURRENT LIABILITIES |
|
|
|
|
|
|
||
Short-term debt |
|
$ |
|
|
$ |
|
||
Accounts payable |
|
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|
|
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|
||
Dividends payable |
|
|
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|
|
|
||
Customer deposits |
|
|
|
|
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|
||
Accrued taxes |
|
|
|
|
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|
||
Accrued interest |
|
|
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|
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|
||
Accrued compensation |
|
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|
||
Long-term debt due within one year |
|
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|
||
Fuel clause over recoveries |
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Other |
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|
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Total current liabilities |
|
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|
||
LONG-TERM DEBT |
|
|
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|
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|
||
DEFERRED CREDITS AND OTHER LIABILITIES |
|
|
|
|
|
|
||
Accrued benefit obligations |
|
|
|
|
|
|
||
Deferred income taxes |
|
|
|
|
|
|
||
Deferred investment tax credits |
|
|
|
|
|
|
||
Regulatory liabilities |
|
|
|
|
|
|
||
Other |
|
|
|
|
|
|
||
Total deferred credits and other liabilities |
|
|
|
|
|
|
||
Total liabilities |
|
|
|
|
|
|
||
COMMITMENTS AND CONTINGENCIES (NOTE 12) |
|
|
|
|
|
|
||
STOCKHOLDERS' EQUITY |
|
|
|
|
|
|
||
Common stockholders' equity |
|
|
|
|
|
|
||
Retained earnings |
|
|
|
|
|
|
||
Accumulated other comprehensive loss, net of tax |
|
|
( |
) |
|
|
( |
) |
Total stockholders' equity |
|
|
|
|
|
|
||
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY |
|
$ |
|
|
$ |
|
||
The accompanying Combined Notes to Condensed Financial Statements are an integral part hereof.
7
OGE ENERGY CORP.
CONDENSED CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS' EQUITY
(Unaudited)
|
|
Common Stock |
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||
|
|
Shares |
|
|
Value |
|
|
Premium on Common Stock |
|
|
Retained Earnings |
|
|
Accumulated Other Comprehensive (Loss) Income |
|
|
Total |
|
||||||
Balance at December 31, 2025 |
|
|
|
|
$ |
|
|
$ |
|
|
$ |
|
|
$ |
( |
) |
|
$ |
|
|||||
Net income |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Other comprehensive income, net of tax |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Dividends declared on common stock ($ |
|
|
|
|
|
|
|
|
|
|
|
( |
) |
|
|
|
|
|
( |
) |
||||
Issuance of common stock |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Stock-based compensation |
|
|
|
|
|
|
|
|
( |
) |
|
|
|
|
|
|
|
|
( |
) |
||||
Balance at March 31, 2026 |
|
|
|
|
$ |
|
|
$ |
|
|
$ |
|
|
$ |
( |
) |
|
$ |
|
|||||
Net income |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Other comprehensive income, net of tax |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Dividends declared on common stock ($ |
|
|
|
|
|
|
|
|
|
|
|
( |
) |
|
|
|
|
|
( |
) |
||||
Issuance of common stock |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Stock-based compensation |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Balance at June 30, 2026 |
|
|
|
|
$ |
|
|
$ |
|
|
$ |
|
|
$ |
( |
) |
|
$ |
|
|||||
Net income |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Other comprehensive income, net of tax |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Dividends declared on common stock ($ |
|
|
|
|
|
|
|
|
|
|
|
( |
) |
|
|
|
|
|
( |
) |
||||
Issuance of common stock |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Stock-based compensation |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Balance at September 30, 2026 |
|
|
|
|
$ |
|
|
$ |
|
|
$ |
|
|
$ |
( |
) |
|
$ |
|
|||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Balance at December 31, 2024 |
|
|
|
|
$ |
|
|
$ |
|
|
$ |
|
|
$ |
( |
) |
|
$ |
|
|||||
Net income |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Other comprehensive income, net of tax |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Dividends declared on common stock ($ |
|
|
|
|
|
|
|
|
|
|
|
( |
) |
|
|
|
|
|
( |
) |
||||
Issuance of common stock |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Stock-based compensation |
|
|
|
|
|
|
|
|
( |
) |
|
|
|
|
|
|
|
|
( |
) |
||||
Balance at March 31, 2025 |
|
|
|
|
$ |
|
|
$ |
|
|
$ |
|
|
$ |
( |
) |
|
$ |
|
|||||
Net income |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Other comprehensive income, net of tax |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Dividends declared on common stock ($ |
|
|
|
|
|
|
|
|
|
|
|
( |
) |
|
|
|
|
|
( |
) |
||||
Issuance of common stock |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Stock-based compensation |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Balance at June 30, 2025 |
|
|
|
|
$ |
|
|
$ |
|
|
$ |
|
|
$ |
( |
) |
|
$ |
|
|||||
Net income |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Other comprehensive income, net of tax |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Dividends declared on common stock ($ |
|
|
|
|
|
|
|
|
|
|
|
( |
) |
|
|
|
|
|
( |
) |
||||
Issuance of common stock |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Stock-based compensation |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Balance at September 30, 2025 |
|
|
|
|
$ |
|
|
$ |
|
|
$ |
|
|
$ |
( |
) |
|
$ |
|
|||||
The accompanying Combined Notes to Condensed Financial Statements are an integral part hereof.
8
OKLAHOMA GAS AND ELECTRIC COMPANY
CONDENSED STATEMENTS OF INCOME AND COMPREHENSIVE INCOME
(Unaudited)
|
|
Three Months Ended |
|
|
Nine Months Ended |
|
||||||||||
|
|
September 30, |
|
|
September 30, |
|
||||||||||
(In millions) |
|
2026 |
|
|
2025 |
|
|
2026 |
|
|
2025 |
|
||||
OPERATING REVENUES |
|
|
|
|
|
|
|
|
|
|
|
|
||||
Revenues from contracts with customers |
|
$ |
|
|
$ |
|
|
$ |
|
|
$ |
|
||||
Other revenues |
|
|
|
|
|
|
|
|
|
|
|
|
||||
Operating revenues |
|
|
|
|
|
|
|
|
|
|
|
|
||||
FUEL, PURCHASED POWER AND DIRECT TRANSMISSION EXPENSE |
|
|
|
|
|
|
|
|
|
|
|
|
||||
OPERATING EXPENSES |
|
|
|
|
|
|
|
|
|
|
|
|
||||
Other operation and maintenance |
|
|
|
|
|
|
|
|
|
|
|
|
||||
Depreciation and amortization |
|
|
|
|
|
|
|
|
|
|
|
|
||||
Taxes other than income |
|
|
|
|
|
|
|
|
|
|
|
|
||||
Operating expenses |
|
|
|
|
|
|
|
|
|
|
|
|
||||
OPERATING INCOME |
|
|
|
|
|
|
|
|
|
|
|
|
||||
OTHER INCOME (EXPENSE) |
|
|
|
|
|
|
|
|
|
|
|
|
||||
Allowance for equity funds used during construction |
|
|
|
|
|
|
|
|
|
|
|
|
||||
Other net periodic benefit expense |
|
|
( |
) |
|
|
( |
) |
|
|
( |
) |
|
|
( |
) |
Other income |
|
|
|
|
|
|
|
|
|
|
|
|
||||
Other expense |
|
|
( |
) |
|
|
( |
) |
|
|
( |
) |
|
|
( |
) |
Net other income |
|
|
|
|
|
|
|
|
|
|
|
|
||||
INTEREST EXPENSE |
|
|
|
|
|
|
|
|
|
|
|
|
||||
Interest on long-term debt |
|
|
|
|
|
|
|
|
|
|
|
|
||||
Allowance for borrowed funds used during construction |
|
|
( |
) |
|
|
( |
) |
|
|
( |
) |
|
|
( |
) |
Interest on short-term debt and other interest charges |
|
|
( |
) |
|
|
( |
) |
|
|
( |
) |
|
|
|
|
Interest expense |
|
|
|
|
|
|
|
|
|
|
|
|
||||
INCOME BEFORE TAXES |
|
|
|
|
|
|
|
|
|
|
|
|
||||
INCOME TAX EXPENSE |
|
|
|
|
|
|
|
|
|
|
|
|
||||
NET INCOME |
|
$ |
|
|
$ |
|
|
$ |
|
|
$ |
|
||||
Other comprehensive income, net of tax |
|
|
|
|
|
|
|
|
|
|
|
|
||||
COMPREHENSIVE INCOME |
|
$ |
|
|
$ |
|
|
$ |
|
|
$ |
|
||||
The accompanying Combined Notes to Condensed Financial Statements are an integral part hereof.
9
OKLAHOMA GAS AND ELECTRIC COMPANY
CONDENSED STATEMENTS OF CASH FLOWS
(Unaudited)
|
|
Nine Months Ended September 30, |
|
|||||
(In millions) |
|
2026 |
|
|
2025 |
|
||
CASH FLOWS FROM OPERATING ACTIVITIES |
|
|
|
|
|
|
||
Net income |
|
$ |
|
|
$ |
|
||
Adjustments to reconcile net income to net cash provided from operating activities: |
|
|
|
|
|
|
||
Depreciation and amortization |
|
|
|
|
|
|
||
Deferred income taxes and other tax credits, net |
|
|
|
|
|
|
||
Allowance for equity funds used during construction |
|
|
( |
) |
|
|
( |
) |
Stock-based compensation expense |
|
|
|
|
|
|
||
Regulatory assets |
|
|
( |
) |
|
|
( |
) |
Regulatory liabilities |
|
|
|
|
|
|
||
Other assets |
|
|
|
|
|
( |
) |
|
Other liabilities |
|
|
( |
) |
|
|
|
|
Change in certain current assets and liabilities: |
|
|
|
|
|
|
||
Accounts receivable and accrued unbilled revenues, net |
|
|
( |
) |
|
|
( |
) |
Fuel, materials and supplies inventories |
|
|
( |
) |
|
|
|
|
Fuel recoveries |
|
|
|
|
|
|
||
Other current assets |
|
|
|
|
|
|
||
Accounts payable |
|
|
( |
) |
|
|
|
|
Income taxes payable - parent |
|
|
|
|
|
|
||
Other current liabilities |
|
|
|
|
|
|
||
Net cash provided from operating activities |
|
|
|
|
|
|
||
CASH FLOWS FROM INVESTING ACTIVITIES |
|
|
|
|
|
|
||
Capital expenditures (less allowance for equity funds used during construction) |
|
|
( |
) |
|
|
( |
) |
Cost of removal |
|
|
( |
) |
|
|
( |
) |
Net cash used in investing activities |
|
|
( |
) |
|
|
( |
) |
CASH FLOWS FROM FINANCING ACTIVITIES |
|
|
|
|
|
|
||
Changes in advances with parent |
|
|
( |
) |
|
|
( |
) |
Proceeds from long-term debt |
|
|
|
|
|
|
||
Payment of long-term debt |
|
|
( |
) |
|
|
( |
) |
Capital contribution from OGE Energy |
|
|
|
|
|
|
||
Dividends paid on common stock |
|
|
( |
) |
|
|
( |
) |
Net cash (used in) provided from financing activities |
|
|
( |
) |
|
|
|
|
NET CHANGE IN CASH AND CASH EQUIVALENTS |
|
|
|
|
|
|
||
CASH AND CASH EQUIVALENTS AT BEGINNING OF PERIOD |
|
|
|
|
|
|
||
CASH AND CASH EQUIVALENTS AT END OF PERIOD |
|
$ |
|
|
$ |
|
||
The accompanying Combined Notes to Condensed Financial Statements are an integral part hereof.
10
OKLAHOMA GAS AND ELECTRIC COMPANY
CONDENSED BALANCE SHEETS
(Unaudited)
|
|
September 30, |
|
|
December 31, |
|
||
(In millions) |
|
2026 |
|
|
2025 |
|
||
ASSETS |
|
|
|
|
|
|
||
CURRENT ASSETS |
|
|
|
|
|
|
||
Cash and cash equivalents |
|
$ |
|
|
$ |
|
||
Accounts receivable, less reserve of $ |
|
|
|
|
|
|
||
Accrued unbilled revenues |
|
|
|
|
|
|
||
Advances to parent |
|
|
|
|
|
|
||
Fuel inventories |
|
|
|
|
|
|
||
Materials and supplies, at average cost |
|
|
|
|
|
|
||
Other |
|
|
|
|
|
|
||
Total current assets |
|
|
|
|
|
|
||
OTHER PROPERTY AND INVESTMENTS |
|
|
|
|
|
|
||
PROPERTY, PLANT AND EQUIPMENT |
|
|
|
|
|
|
||
In service |
|
|
|
|
|
|
||
Construction work in progress |
|
|
|
|
|
|
||
Total property, plant and equipment |
|
|
|
|
|
|
||
Less: accumulated depreciation |
|
|
|
|
|
|
||
Net property, plant and equipment |
|
|
|
|
|
|
||
DEFERRED CHARGES AND OTHER ASSETS |
|
|
|
|
|
|
||
Regulatory assets |
|
|
|
|
|
|
||
Other |
|
|
|
|
|
|
||
Total deferred charges and other assets |
|
|
|
|
|
|
||
TOTAL ASSETS |
|
$ |
|
|
$ |
|
||
The accompanying Combined Notes to Condensed Financial Statements are an integral part hereof.
11
OKLAHOMA GAS AND ELECTRIC COMPANY
CONDENSED BALANCE SHEETS (Continued)
(Unaudited)
|
|
September 30, |
|
|
December 31, |
|
||
(In millions) |
|
2026 |
|
|
2025 |
|
||
LIABILITIES AND STOCKHOLDER'S EQUITY |
|
|
|
|
|
|
||
CURRENT LIABILITIES |
|
|
|
|
|
|
||
Accounts payable |
|
$ |
|
|
$ |
|
||
Customer deposits |
|
|
|
|
|
|
||
Accrued taxes |
|
|
|
|
|
|
||
Accrued interest |
|
|
|
|
|
|
||
Accrued compensation |
|
|
|
|
|
|
||
Long-term debt due within one year |
|
|
|
|
|
|
||
Fuel clause over recoveries |
|
|
|
|
|
|
||
Other |
|
|
|
|
|
|
||
Total current liabilities |
|
|
|
|
|
|
||
LONG-TERM DEBT |
|
|
|
|
|
|
||
DEFERRED CREDITS AND OTHER LIABILITIES |
|
|
|
|
|
|
||
Accrued benefit obligations |
|
|
|
|
|
|
||
Deferred income taxes |
|
|
|
|
|
|
||
Deferred investment tax credits |
|
|
|
|
|
|
||
Regulatory liabilities |
|
|
|
|
|
|
||
Other |
|
|
|
|
|
|
||
Total deferred credits and other liabilities |
|
|
|
|
|
|
||
Total liabilities |
|
|
|
|
|
|
||
COMMITMENTS AND CONTINGENCIES (NOTE 12) |
|
|
|
|
|
|
||
STOCKHOLDER'S EQUITY |
|
|
|
|
|
|
||
Common stockholder's equity |
|
|
|
|
|
|
||
Retained earnings |
|
|
|
|
|
|
||
Total stockholder's equity |
|
|
|
|
|
|
||
TOTAL LIABILITIES AND STOCKHOLDER'S EQUITY |
|
$ |
|
|
$ |
|
||
The accompanying Combined Notes to Condensed Financial Statements are an integral part hereof.
12
OKLAHOMA GAS AND ELECTRIC COMPANY
CONDENSED STATEMENTS OF CHANGES IN STOCKHOLDER'S EQUITY
(Unaudited)
|
|
Common Stock |
|
|
|
|
|
|
|
|
|
|
||||||||
(In millions) |
|
Shares |
|
|
Value |
|
|
Premium on Common Stock |
|
|
Retained Earnings |
|
|
Total |
|
|||||
Balance at December 31, 2025 |
|
|
|
|
$ |
|
|
$ |
|
|
$ |
|
|
$ |
|
|||||
Net income |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
Stock-based compensation |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
Balance at March 31, 2026 |
|
|
|
|
$ |
|
|
$ |
|
|
$ |
|
|
$ |
|
|||||
Net income |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
Capital contribution from OGE Energy |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
Stock-based compensation |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
Balance at June 30, 2026 |
|
|
|
|
$ |
|
|
$ |
|
|
$ |
|
|
$ |
|
|||||
Net income |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
Dividends declared on common stock |
|
|
|
|
|
|
|
|
|
|
|
( |
) |
|
|
( |
) |
|||
Stock-based compensation |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
Balance at September 30, 2026 |
|
|
|
|
$ |
|
|
$ |
|
|
$ |
|
|
$ |
|
|||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
Balance at December 31, 2024 |
|
|
|
|
$ |
|
|
$ |
|
|
$ |
|
|
$ |
|
|||||
Net income |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
Stock-based compensation |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
Balance at March 31, 2025 |
|
|
|
|
$ |
|
|
$ |
|
|
$ |
|
|
$ |
|
|||||
Net income |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
Capital contribution from OGE Energy |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
Stock-based compensation |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
Balance at June 30, 2025 |
|
|
|
|
$ |
|
|
$ |
|
|
$ |
|
|
$ |
|
|||||
Net income |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
Dividends declared on common stock |
|
|
|
|
|
|
|
|
|
|
|
( |
) |
|
|
( |
) |
|||
Stock-based compensation |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
Balance at September 30, 2025 |
|
|
|
|
$ |
|
|
$ |
|
|
$ |
|
|
$ |
|
|||||
The accompanying Combined Notes to Condensed Financial Statements are an integral part hereof.
13
COMBINED NOTES TO THE CONDENSED FINANCIAL STATEMENTS
(Unaudited)
Index of Combined Notes to Condensed Financial Statements
The Combined Notes to the Condensed Financial Statements are a combined presentation for OGE Energy and OG&E. The following table indicates the Registrant(s) to which each Note applies.
|
OGE Energy |
|
OG&E |
Note 1. Summary of Significant Accounting Policies |
X |
|
X |
Note 2. Accounting Pronouncements |
X |
|
X |
Note 3. Revenue Recognition |
X |
|
X |
Note 4. Fair Value Measurements |
X |
|
X |
Note 5. Stock-Based Compensation |
X |
|
X |
Note 6. Income Taxes |
X |
|
X |
Note 7. Common Equity |
X |
|
|
Note 8. Long-Term Debt |
X |
|
X |
Note 9. Credit Facilities and Short-Term Debt |
X |
|
X |
Note 10. Retirement Plans and Postretirement Benefit Plans |
X |
|
X |
Note 11. Report of Business Segments |
X |
|
|
Note 12. Commitments and Contingencies |
X |
|
X |
Note 13. Rate Matters and Regulation |
X |
|
X |
1. Summary of Significant Accounting Policies
Organization
OGE Energy is a holding company whose primary investment provides electricity in Oklahoma and western Arkansas. OGE Energy's electric company operations are conducted through its wholly-owned subsidiary, OG&E, which generates, transmits, distributes and sells electric energy in Oklahoma and western Arkansas and are reported through OGE Energy's electric company business segment. OG&E's rates are subject to regulation by the OCC, the APSC and the FERC. OG&E was incorporated in 1902 under the laws of the Oklahoma Territory and is the largest electric company in Oklahoma, with a franchised service territory that includes Fort Smith, Arkansas and the surrounding communities. OG&E sold its retail natural gas business in 1928 and is no longer engaged in the natural gas distribution business.
The accounts of OGE Energy and its wholly-owned subsidiaries, including OG&E, are included in OGE Energy's condensed consolidated financial statements. All intercompany transactions and balances are eliminated in such consolidation.
Basis of Presentation
The condensed financial statements included herein have been prepared by the Registrants, without audit, pursuant to the rules and regulations of the Securities and Exchange Commission. Certain information and footnote disclosures normally included in financial statements prepared in accordance with GAAP have been condensed or omitted pursuant to such rules and regulations; however, the Registrants believe that the disclosures are adequate to prevent the information presented from being misleading.
In the opinion of management, all adjustments necessary to fairly present the financial position of the Registrants at September 30, 2026 and December 31, 2025, the results of the Registrants' operations for the three and nine months ended September 30, 2026 and 2025 and the Registrants' cash flows for the nine months ended September 30, 2026 and 2025 have been included and are of a normal, recurring nature except as otherwise disclosed. Management also has evaluated the impact of events occurring after September 30, 2026 up to the date of issuance of these condensed financial statements, and these statements contain all necessary adjustments and disclosures resulting from that evaluation.
Due to seasonal fluctuations and other factors, the Registrants' operating results for the three and nine months ended September 30, 2026 are not necessarily indicative of the results that may be expected for the year ending December 31, 2026 or for any future period. The condensed financial statements and notes thereto should be read in conjunction with the audited financial statements and notes thereto included in the Registrants' 2025 Form 10-K.
14
Accounting Records
The accounting records of OG&E are maintained in accordance with the Uniform System of Accounts prescribed by the FERC and adopted by the OCC and the APSC. Additionally, OG&E, as a regulated electric company, is subject to accounting principles for certain types of rate-regulated activities, which provide that certain incurred costs that would otherwise be charged to expense can be deferred as regulatory assets, based on the expected recovery from customers in future rates. Likewise, certain actual or anticipated credits that would otherwise reduce expense can be deferred as regulatory liabilities, based on the expected flowback to customers in future rates. Management's expected recovery of deferred costs and flowback of deferred credits generally results from specific decisions by regulators granting such ratemaking treatment.
OG&E records certain incurred costs and obligations as regulatory assets or liabilities if, based on regulatory orders or other available evidence, it is probable that the costs or obligations will be included in amounts allowable for recovery or refund in future rates.
|
|
September 30, |
|
|
December 31, |
|
||
(In millions) |
|
2026 |
|
|
2025 |
|
||
REGULATORY ASSETS |
|
|
|
|
|
|
||
Current: |
|
|
|
|
|
|
||
SPP cost tracker under recoveries (A) |
|
$ |
|
|
$ |
|
||
Other (A) |
|
|
|
|
|
|
||
Total current regulatory assets |
|
$ |
|
|
$ |
|
||
Non-current: |
|
|
|
|
|
|
||
Oklahoma deferred storm expenses |
|
$ |
|
|
$ |
|
||
Oklahoma PISA deferred costs, net |
|
|
|
|
|
|
||
Pension tracker |
|
|
|
|
|
|
||
Benefit obligations regulatory asset |
|
|
|
|
|
|
||
Arkansas Winter Storm Uri costs |
|
|
|
|
|
|
||
Oklahoma SAP S/4 HANA deferred expenses |
|
|
|
|
|
|
||
Sooner Dry Scrubbers |
|
|
|
|
|
|
||
Oklahoma vegetation management program deferred costs |
|
|
|
|
|
|
||
Arkansas capacity purchase power agreements |
|
|
|
|
|
|
||
Arkansas deferred pension expenses |
|
|
|
|
|
|
||
Unamortized loss on reacquired debt |
|
|
|
|
|
|
||
COVID-19 impacts |
|
|
|
|
|
|
||
Other |
|
|
|
|
|
|
||
Total non-current regulatory assets |
|
$ |
|
|
$ |
|
||
REGULATORY LIABILITIES |
|
|
|
|
|
|
||
Current: |
|
|
|
|
|
|
||
Oklahoma fuel clause over recoveries |
|
$ |
|
|
$ |
|
||
Arkansas fuel clause over recoveries |
|
|
|
|
|
|
||
Oklahoma Energy Efficiency Rider over recoveries (B) |
|
|
|
|
|
|
||
Other (B) |
|
|
|
|
|
|
||
Total current regulatory liabilities |
|
$ |
|
|
$ |
|
||
Non-current: |
|
|
|
|
|
|
||
Income taxes refundable to customers, net |
|
$ |
|
|
$ |
|
||
Accrued removal obligations, net |
|
|
|
|
|
|
||
Other |
|
|
|
|
|
|
||
Total non-current regulatory liabilities |
|
$ |
|
|
$ |
|
||
Management continuously monitors the future recoverability of regulatory assets. When in management's judgment future recovery becomes impaired, the amount of the regulatory asset is adjusted, as appropriate. If OG&E were required to discontinue the
15
application of accounting principles for certain types of rate-regulated activities for some or all of its operations, it could result in writing off the related regulatory assets or liabilities, which could have significant financial effects.
Allowance for Uncollectible Accounts Receivable
Customer balances are generally written off if not collected within six months after the final billing date. The allowance for uncollectible accounts receivable for OG&E is generally calculated by multiplying the last six months of electric revenue by the provision rate, which is based on a historical average of actual balances written off and is adjusted for current conditions and supportable forecasts as necessary. To the extent the historical collection rates, when incorporating forecasted conditions, are not representative of future collections, there could be an effect on the amount of uncollectible expense recognized. Also, a portion of the uncollectible provision related to fuel within the Oklahoma jurisdiction is being recovered through the fuel adjustment clause. The allowance for uncollectible accounts receivable is a reduction to Accounts Receivable in the condensed balance sheets and is included in Other Operation and Maintenance Expense in the condensed statements of income.
New business customers are required to provide a security deposit in the form of cash, bond or irrevocable letter of credit that is refunded when the account is closed or when certain requirements are met. New residential customers whose outside credit scores indicate an elevated risk are required to provide a security deposit that is refunded based on customer protection rules defined by the OCC and the APSC. The payment behavior of all existing customers is continuously monitored, and, if the payment behavior indicates sufficient risk within the meaning of the applicable utility regulation, customers will be required to provide a security deposit.
Accumulated Other Comprehensive Income (Loss)
The following tables present changes in the components of accumulated other comprehensive income (loss) attributable to OGE Energy during the nine months ended September 30, 2026 and 2025. All amounts below are presented net of tax.
(In millions) |
Pension Plan and Restoration of Retirement Income Plan |
|
Postretirement Benefit Plans |
|
Total |
|
|||
Balance at December 31, 2025 |
$ |
( |
) |
$ |
|
$ |
( |
) |
|
Amounts reclassified from accumulated other comprehensive income (loss) |
|
|
|
( |
) |
|
|
||
Balance at September 30, 2026 |
$ |
( |
) |
$ |
|
$ |
( |
) |
|
(In millions) |
Pension Plan and Restoration of Retirement Income Plan |
|
Postretirement Benefit Plans |
|
Total |
|
|||
Balance at December 31, 2024 |
$ |
( |
) |
$ |
|
$ |
( |
) |
|
Amounts reclassified from accumulated other comprehensive income (loss) |
|
|
|
( |
) |
|
|
||
Balance at September 30, 2025 |
$ |
( |
) |
$ |
|
$ |
( |
) |
|
16
The following table presents significant amounts reclassified out of accumulated other comprehensive income (loss) attributable to OGE Energy by the respective line items in net income during the three and nine months ended September 30, 2026 and 2025.
Details about Accumulated Other Comprehensive Income (Loss) Components |
|
Amount Reclassified from Accumulated Other Comprehensive Income (Loss) |
|
|
Affected Line Item in |
|||||||||||||
|
|
Three Months Ended |
|
|
Nine Months Ended |
|
|
|
||||||||||
|
|
September 30, |
|
|
September 30, |
|
|
|
||||||||||
(In millions) |
|
2026 |
|
|
2025 |
|
|
2026 |
|
|
2025 |
|
|
|
||||
Amortization of Pension Plan and Restoration of Retirement Income Plan items: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
Actuarial losses |
|
$ |
( |
) |
|
$ |
( |
) |
|
$ |
( |
) |
|
$ |
( |
) |
|
(A) |
Prior service cost |
|
|
|
|
|
( |
) |
|
|
( |
) |
|
|
( |
) |
|
(A) |
|
|
|
|
( |
) |
|
|
( |
) |
|
|
( |
) |
|
|
( |
) |
|
Income Before Taxes |
|
|
|
|
|
|
|
|
|
( |
) |
|
|
( |
) |
|
Income Tax Expense |
||
|
|
$ |
( |
) |
|
$ |
( |
) |
|
$ |
( |
) |
|
$ |
( |
) |
|
Net Income |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
Amortization of postretirement benefit plans items: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
Actuarial gains |
|
$ |
|
|
$ |
|
|
$ |
|
|
$ |
|
|
(A) |
||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Income Before Taxes |
||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Income Tax Expense |
||||
|
|
$ |
|
|
$ |
|
|
$ |
|
|
$ |
|
|
Net Income |
||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
Total reclassifications for the period, net of tax |
|
$ |
|
|
$ |
( |
) |
|
$ |
( |
) |
|
$ |
( |
) |
|
Net Income |
|
2. Accounting Pronouncements
In November 2024, the Financial Accounting Standards Board issued ASU 2024-03, "Income Statement - Reporting Comprehensive Income - Expense Disaggregation Disclosures." The amendments in this update improve financial reporting by requiring disclosure of additional information about specific expense categories in the notes to financial statements on an annual and interim basis. This standard is effective for fiscal years beginning after December 15, 2026 and interim periods beginning after December 15, 2027. Early adoption is permitted. The Registrants are evaluating the impact of this standard and do not believe it will have a material impact on their financial statement disclosures.
In September 2025, the Financial Accounting Standards Board issued ASU 2025-06, "Intangibles - Goodwill and Other - Internal-Use Software." The targeted improvements in this update aim to better align current software development processes when considering capitalization of internal-use software costs. This standard is effective for fiscal years beginning after December 15, 2027 and interim periods within that period. Early adoption is permitted. The Registrants are evaluating the impact of this standard on their financial statements.
In May 2026, the Financial Accounting Standards Board issued ASU 2026-02, "Environmental Credits and Environmental Credit Obligations (Topic 818)." The amendments in this update provide recognition, measurement, presentation, and disclosure requirements for all entities that generate, purchase, or receive environmental credits or have a regulatory compliance obligation that may be settled with environmental credits. This standard is effective for fiscal years beginning after December 15, 2027 and interim periods within that period. Early adoption is permitted. The Registrants are evaluating the impact of this standard on their financial statements and disclosures.
The Registrants believe that other recently adopted and recently issued accounting standards that are not yet effective do not appear to have a material impact on the Registrants' financial position, results of operations or cash flows upon adoption.
17
3. Revenue Recognition
The following table presents OG&E's revenues from contracts with customers disaggregated by customer classification. OG&E's operating revenues disaggregated by customer classification can be found in "OG&E (Electric Company) Results of Operations" within "Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations."
|
|
Three Months Ended |
|
|
Nine Months Ended |
|
||||||||||
(In millions) |
|
2026 |
|
|
2025 |
|
|
2026 |
|
|
2025 |
|
||||
Residential |
|
$ |
|
|
$ |
|
|
$ |
|
|
$ |
|
||||
Commercial |
|
|
|
|
|
|
|
|
|
|
|
|
||||
Industrial |
|
|
|
|
|
|
|
|
|
|
|
|
||||
Oilfield |
|
|
|
|
|
|
|
|
|
|
|
|
||||
Public authorities and street light |
|
|
|
|
|
|
|
|
|
|
|
|
||||
System sales revenues |
|
|
|
|
|
|
|
|
|
|
|
|
||||
Provision for rate refund |
|
|
|
|
|
|
|
|
|
|
|
|
||||
Integrated market |
|
|
|
|
|
|
|
|
|
|
|
|
||||
Transmission |
|
|
|
|
|
|
|
|
|
|
|
|
||||
Other |
|
|
|
|
|
|
|
|
|
|
|
|
||||
Revenues from contracts with customers |
|
$ |
|
|
$ |
|
|
$ |
|
|
$ |
|
||||
4. Fair Value Measurements
The classification of the Registrants' fair value measurements requires judgment regarding the degree to which market data is observable or corroborated by observable market data. GAAP establishes a fair value hierarchy that prioritizes the inputs used to measure fair value based on observable and unobservable data. The hierarchy categorizes the inputs into three levels, with the highest priority given to quoted prices in active markets for identical unrestricted assets or liabilities (Level 1) and the lowest priority given to unobservable inputs (Level 3). Financial assets and liabilities are classified in their entirety based on the lowest level of input that is significant to the fair value measurement. The three levels defined in the fair value hierarchy are as follows:
Level 1 inputs are quoted prices in active markets for identical unrestricted assets or liabilities that are accessible at the measurement date.
Level 2 inputs are inputs other than quoted prices in active markets included within Level 1 that are either directly or indirectly observable at the reporting date for the asset or liability for substantially the full term of the asset or liability. Level 2 inputs include quoted prices for similar assets or liabilities in active markets and quoted prices for identical or similar assets or liabilities in markets that are not active.
Level 3 inputs are prices or valuation techniques for the asset or liability that require inputs that are both significant to the fair value measurement and unobservable (i.e., supported by little or no market activity). Unobservable inputs reflect the reporting entity's own assumptions about the assumptions that market participants would use in pricing the asset or liability (including assumptions about risk).
18
The Registrants had
|
|
September 30, |
|
|
December 31, |
|
|
|
||||||||||
(In millions) |
|
Carrying Amount |
|
|
Fair |
|
|
Carrying Amount |
|
|
Fair |
|
|
Classification |
||||
Long-term Debt (including Long-term Debt due within one year): |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
OGE Energy Senior Notes |
|
$ |
|
|
$ |
|
|
$ |
|
|
$ |
|
|
Level 2 |
||||
OGE Energy Term Loan |
|
$ |
|
|
$ |
|
|
$ |
|
|
$ |
|
|
Level 2 |
||||
OG&E Senior Notes |
|
$ |
|
|
$ |
|
|
$ |
|
|
$ |
|
|
Level 2 |
||||
OG&E Industrial Authority Bonds |
|
$ |
|
|
$ |
|
|
$ |
|
|
$ |
|
|
Level 2 |
||||
OG&E Tinker Debt |
|
$ |
|
|
$ |
|
|
$ |
|
|
$ |
|
|
Level 3 |
||||
5. Stock-Based Compensation
The following table presents the Registrants' pre-tax compensation expense and related income tax benefit for the three and nine months ended September 30, 2026 and 2025 related to performance units and restricted stock units for the Registrants' employees.
|
|
Three Months Ended |
|
|
Nine Months Ended |
|
||||||||||
OGE Energy and OG&E |
|
September 30, |
|
|
September 30, |
|
||||||||||
(In millions) |
|
2026 |
|
|
2025 |
|
|
2026 |
|
|
2025 |
|
||||
Performance units |
|
$ |
|
|
$ |
|
|
$ |
|
|
$ |
|
||||
Restricted stock units |
|
|
|
|
|
|
|
|
|
|
|
|
||||
Total compensation expense |
|
$ |
|
|
$ |
|
|
$ |
|
|
$ |
|
||||
Income tax benefit |
|
$ |
|
|
$ |
|
|
$ |
|
|
$ |
|
||||
During the nine months ended September 30, 2026, OGE Energy issued
During the nine months ended September 30, 2026, OGE Energy granted
6. Income Taxes
7. Common Equity
Automatic Dividend Reinvestment and Stock Purchase Plan
OGE Energy issued
19
Common Stock Public Offering and Forward Equity Sale Agreements
In November 2025, OGE Energy entered into FSAs in connection with a completed public offering of
At September 30, 2026, OGE Energy could have settled the FSAs with physical delivery of
Prior to settlement, the potentially issuable shares pursuant to the FSAs will be reflected in OGE Energy's diluted earnings per share calculations using the treasury stock method. Under this method, the number of shares of OGE Energy's common stock used in calculating diluted earnings per share for a reporting period would be increased by the number of shares, if any, that would be issued upon physical settlement of the FSAs, less the number of shares that could be purchased by OGE Energy in the market with the proceeds received from issuance (based on the average market price during that reporting period). Share dilution occurs when the average market price of OGE Energy's stock during the reporting period is higher than the then-applicable forward sale price as of the end of the reporting period. For the three and nine months ended September 30, 2026, approximately
Earnings Per Share
Basic earnings per share is calculated by dividing net income attributable to OGE Energy by the weighted-average number of OGE Energy's common shares outstanding during the period. In the calculation of diluted earnings per share, weighted-average shares outstanding are increased for additional shares that would be outstanding if potentially dilutive securities were converted to common stock. Potentially dilutive securities for OGE Energy consist of performance units and restricted stock units and shares under the FSAs, as further discussed above.
The following table presents the calculation of basic and diluted earnings per share for OGE Energy.
|
|
Three Months Ended |
|
|
Nine Months Ended |
|
||||||||||
|
|
September 30, |
|
|
September 30, |
|
||||||||||
(In millions, except per share data) |
|
2026 |
|
|
2025 |
|
|
2026 |
|
|
2025 |
|
||||
Net income |
|
$ |
|
|
$ |
|
|
$ |
|
|
$ |
|
||||
Average common shares outstanding: |
|
|
|
|
|
|
|
|
|
|
|
|
||||
Basic average common shares outstanding |
|
|
|
|
|
|
|
|
|
|
|
|
||||
Effect of dilutive securities: |
|
|
|
|
|
|
|
|
|
|
|
|
||||
Contingently issuable shares (performance and restricted stock units) |
|
|
|
|
|
|
|
|
|
|
|
|
||||
Forward equity sale agreements |
|
|
|
|
|
|
|
|
|
|
|
|
||||
Diluted average common shares outstanding |
|
|
|
|
|
|
|
|
|
|
|
|
||||
Basic earnings per average common share |
|
$ |
|
|
$ |
|
|
$ |
|
|
$ |
|
||||
Diluted earnings per average common share |
|
$ |
|
|
$ |
|
|
$ |
|
|
$ |
|
||||
Anti-dilutive shares excluded from earnings per share calculation |
|
|
|
|
|
|
|
|
|
|
|
|
||||
20
8. Long-Term Debt
At September 30, 2026, the Registrants were in compliance with all of their debt agreements.
As of September 30, 2026, OG&E's $
On September 9, 2026, OGE Energy entered into an amended $
OG&E Industrial Authority Bonds
OG&E has tax-exempt pollution control bonds with optional redemption provisions that allow the holders to request repayment of the bonds on any business day.
Series |
|
Date Due |
|
Amount |
|
|||||
|
|
|
|
|
|
|
|
(In millions) |
|
|
|
- |
|
|
Muskogee Industrial Authority, |
|
$ |
|
|||
|
- |
|
|
Garfield Industrial Authority, |
|
|
|
|||
Total (redeemable during next 12 months) |
|
$ |
|
|||||||
All of these bonds are subject to an optional tender at the request of the holders, at
Issuance of Long-Term Debt
On April 1, 2026, OG&E issued $
9. Credit Facilities and Short-Term Debt
The Registrants borrow, as necessary, by the issuance of commercial paper and by borrowings under their revolving credit agreements.
On June 12, 2026, OGE Energy and OG&E each entered into new $
21
Borrowings under OGE Energy's new facility bear interest at rates equal to either the SOFR, plus a margin of
Borrowings under OG&E's new facility bear interest at rates equal to either the SOFR, plus a margin of
Each of the new facilities provides for issuance of letters of credit, provided that (i) the aggregate outstanding credit exposure shall not exceed the amount of the revolving credit facilities and (ii) the aggregate outstanding stated amount of letters of credit issued under such facility shall not exceed $
Each of the facilities is unsecured and, under certain circumstances, may be increased (by up to $150.0 million in each case for OGE Energy and OG&E) to a maximum revolving commitment limit of $
The following table presents information regarding the Registrants' revolving credit agreements at September 30, 2026.
Entity |
|
Aggregate |
|
|
Amount |
|
|
Weighted-Average |
|
|
Expiration |
|||
|
|
(In millions) |
|
|
|
|
|
|
||||||
OGE Energy (B) |
|
$ |
|
|
$ |
|
|
|
% |
|
||||
OGE Energy (C) |
|
|
|
|
|
|
|
|
% |
|
||||
OG&E (D)(E) |
|
|
|
|
|
|
|
|
% |
|
||||
Total |
|
$ |
|
|
$ |
|
|
|
% |
|
|
|||
OG&E must obtain regulatory approval from the FERC in order to borrow on a short-term basis. OG&E has the necessary regulatory approvals to incur up to $
22
10. Retirement Plans and Postretirement Benefit Plans
Net Periodic Benefit Cost
The following tables present the net periodic benefit cost components, before consideration of capitalized amounts, of OGE Energy's Pension Plan, Restoration of Retirement Income Plan and postretirement benefit plans that are included in the condensed financial statements. Service cost is presented within Other Operation and Maintenance Expense, and the remaining net periodic benefit cost components as listed in the following tables are presented within Other Net Periodic Benefit Expense in the statements of income. OG&E recovers specific amounts of pension and postretirement medical costs in rates approved in its Oklahoma rate reviews. In accordance with approved orders, OG&E defers the difference between actual pension and postretirement medical expenses and the amount approved in its last Oklahoma rate review as a regulatory asset or regulatory liability. These amounts have been recorded in the Pension tracker in the regulatory assets and liabilities table in Note 1 and within Other Net Periodic Benefit Expense in the statements of income.
|
|
Pension Plan |
|
|
Restoration of Retirement |
|
||||||||||||||||||||||||||
|
|
Three Months Ended |
|
|
Nine Months Ended |
|
|
Three Months Ended |
|
|
Nine Months Ended |
|
||||||||||||||||||||
OGE Energy |
|
September 30, |
|
|
September 30, |
|
|
September 30, |
|
|
September 30, |
|
||||||||||||||||||||
(In millions) |
|
2026 |
|
|
2025 |
|
|
2026 |
|
|
2025 |
|
|
2026 |
|
|
2025 |
|
|
2026 |
|
|
2025 |
|
||||||||
Service cost |
|
$ |
|
|
$ |
|
|
$ |
|
|
$ |
|
|
$ |
|
|
$ |
|
|
$ |
|
|
$ |
|
||||||||
Interest cost |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
Expected return on plan assets |
|
|
( |
) |
|
|
( |
) |
|
|
( |
) |
|
|
( |
) |
|
|
|
|
|
|
|
|
|
|
|
|
||||
Amortization of net loss |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
Amortization of unrecognized prior service cost (A) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
Net periodic benefit cost |
|
$ |
|
|
$ |
|
|
$ |
|
|
$ |
|
|
$ |
|
|
$ |
|
|
$ |
|
|
$ |
|
||||||||
(A)
|
|
Pension Plan |
|
|
Restoration of Retirement |
|
||||||||||||||||||||||||||
|
|
Three Months Ended |
|
|
Nine Months Ended |
|
|
Three Months Ended |
|
|
Nine Months Ended |
|
||||||||||||||||||||
OG&E |
|
September 30, |
|
|
September 30, |
|
|
September 30, |
|
|
September 30, |
|
||||||||||||||||||||
(In millions) |
|
2026 |
|
|
2025 |
|
|
2026 |
|
|
2025 |
|
|
2026 |
|
|
2025 |
|
|
2026 |
|
|
2025 |
|
||||||||
Service cost |
|
$ |
|
|
$ |
|
|
$ |
|
|
$ |
|
|
$ |
|
|
$ |
|
|
$ |
|
|
$ |
|
||||||||
Interest cost |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
Expected return on plan assets |
|
|
( |
) |
|
|
( |
) |
|
|
( |
) |
|
|
( |
) |
|
|
|
|
|
|
|
|
|
|
|
|
||||
Amortization of net loss |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
Total net periodic benefit cost |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
Plus: Amount allocated from OGE Energy |
|
|
( |
) |
|
|
|
|
|
( |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Net periodic benefit cost |
|
$ |
|
|
$ |
|
|
$ |
|
|
$ |
|
|
$ |
|
|
$ |
|
|
$ |
|
|
$ |
|
||||||||
In addition to the net periodic benefit cost amounts recognized, as presented in the tables above, for the Pension and Restoration of Retirement Income Plans during the three and nine months ended September 30, 2026 and 2025, the Registrants recognized the following:
|
|
Three Months Ended |
|
|
Nine Months Ended |
|
||||||||||
|
|
September 30, |
|
|
September 30, |
|
||||||||||
(In millions) |
|
2026 |
|
|
2025 |
|
|
2026 |
|
|
2025 |
|
||||
Change in pension expense to maintain allowed recoverable amount in Oklahoma jurisdiction (A) |
|
$ |
( |
) |
|
$ |
( |
) |
|
$ |
( |
) |
|
$ |
( |
) |
23
|
|
OGE Energy |
|
|
OG&E |
|
||||||||||||||||||||||||||
|
|
Postretirement Benefit Plans |
|
|
Postretirement Benefit Plans |
|
||||||||||||||||||||||||||
|
|
Three Months Ended |
|
|
Nine Months Ended |
|
|
Three Months Ended |
|
|
Nine Months Ended |
|
||||||||||||||||||||
|
|
September 30, |
|
|
September 30, |
|
|
September 30, |
|
|
September 30, |
|
||||||||||||||||||||
(In millions) |
|
2026 |
|
|
2025 |
|
|
2026 |
|
|
2025 |
|
|
2026 |
|
|
2025 |
|
|
2026 |
|
|
2025 |
|
||||||||
Service cost |
|
$ |
|
|
$ |
|
|
$ |
|
|
$ |
|
|
$ |
|
|
$ |
|
|
$ |
|
|
$ |
|
||||||||
Interest cost |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
Expected return on plan assets |
|
|
( |
) |
|
|
( |
) |
|
|
( |
) |
|
|
( |
) |
|
|
( |
) |
|
|
( |
) |
|
|
( |
) |
|
|
( |
) |
Amortization of net (gain) loss |
|
|
( |
) |
|
|
|
|
|
( |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Total net periodic benefit cost |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
Plus: Amount allocated from OGE Energy |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
Net periodic benefit cost |
|
$ |
|
|
$ |
|
|
$ |
|
|
$ |
|
|
$ |
|
|
$ |
|
|
$ |
|
|
$ |
|
||||||||
In addition to the net periodic benefit cost amounts recognized, as presented in the table above, for the postretirement benefit plans during the three and nine months ended September 30, 2026 and 2025, the Registrants recognized the following:
|
|
Three Months Ended |
|
|
Nine Months Ended |
|
||||||||||
|
|
September 30, |
|
|
September 30, |
|
||||||||||
(In millions) |
|
2026 |
|
|
2025 |
|
|
2026 |
|
|
2025 |
|
||||
Change in postretirement expense to maintain allowed recoverable amount in Oklahoma jurisdiction (A) |
|
$ |
( |
) |
|
$ |
|
|
$ |
( |
) |
|
$ |
|
||
The following table presents the amount of net periodic benefit cost capitalized and attributable to each of the Registrants for OGE Energy's Pension Plan and postretirement benefit plans for the three and nine months ended September 30, 2026 and 2025.
|
|
Three Months Ended |
|
|
Nine Months Ended |
|
||||||||||
OGE Energy and OG&E |
|
September 30, |
|
|
September 30, |
|
||||||||||
(In millions) |
|
2026 |
|
|
2025 |
|
|
2026 |
|
|
2025 |
|
||||
Capitalized portion of net periodic pension benefit cost |
|
$ |
|
|
$ |
|
|
$ |
|
|
$ |
|
||||
Capitalized portion of net periodic postretirement benefit cost |
|
$ |
|
|
$ |
|
|
$ |
|
|
$ |
|
||||
Pension Plan Funding
During the nine months ended September 30, 2026, OGE Energy contributed $
24
11. Report of Business Segments
OGE Energy reports its operations primarily through a single segment, captioned "electric company," which is engaged in the generation, transmission, distribution and sale of electric energy. The "other operations" caption primarily includes the operations of the holding company and other energy-related investments. Intersegment revenues are recorded at prices comparable to those of unaffiliated customers and are affected by regulatory considerations.
Three Months Ended September 30, 2026 |
|
Electric Company |
|
|
Other |
|
|
Eliminations |
|
|
Total |
|
||||
(In millions) |
|
|
|
|
|
|
|
|
|
|
|
|
||||
Operating revenues |
|
$ |
|
|
$ |
|
|
$ |
|
|
$ |
|
||||
Fuel, purchased power and direct transmission expense |
|
|
|
|
|
|
|
|
|
|
|
|
||||
Other operation and maintenance |
|
|
|
|
|
|
|
|
|
|
|
|
||||
Depreciation and amortization |
|
|
|
|
|
|
|
|
|
|
|
|
||||
Taxes other than income |
|
|
|
|
|
|
|
|
|
|
|
|
||||
Operating income |
|
|
|
|
|
|
|
|
|
|
|
|
||||
Net other income |
|
|
|
|
|
|
|
|
( |
) |
|
|
|
|||
Interest expense |
|
|
|
|
|
|
|
|
( |
) |
|
|
|
|||
Income tax expense (benefit) |
|
|
|
|
|
( |
) |
|
|
|
|
|
|
|||
Net income (loss) |
|
$ |
|
|
$ |
( |
) |
|
$ |
|
|
$ |
|
|||
Total assets |
|
$ |
|
|
$ |
|
|
$ |
( |
) |
|
$ |
|
|||
Capital expenditures |
|
$ |
|
|
$ |
|
|
$ |
— |
|
|
$ |
|
|||
Three Months Ended September 30, 2025 |
|
Electric Company |
|
|
Other |
|
|
Eliminations |
|
|
Total |
|
||||
(In millions) |
|
|
|
|
|
|
|
|
|
|
|
|
||||
Operating revenues |
|
$ |
|
|
$ |
|
|
$ |
|
|
$ |
|
||||
Fuel, purchased power and direct transmission expense |
|
|
|
|
|
|
|
|
|
|
|
|
||||
Other operation and maintenance |
|
|
|
|
|
( |
) |
|
|
|
|
|
|
|||
Depreciation and amortization |
|
|
|
|
|
|
|
|
|
|
|
|
||||
Taxes other than income |
|
|
|
|
|
|
|
|
|
|
|
|
||||
Operating income |
|
|
|
|
|
|
|
|
|
|
|
|
||||
Net other income (expense) |
|
|
|
|
|
( |
) |
|
|
( |
) |
|
|
|
||
Interest expense |
|
|
|
|
|
|
|
|
( |
) |
|
|
|
|||
Income tax expense (benefit) |
|
|
|
|
|
( |
) |
|
|
|
|
|
|
|||
Net income (loss) |
|
$ |
|
|
$ |
( |
) |
|
$ |
|
|
$ |
|
|||
Total assets |
|
$ |
|
|
$ |
|
|
$ |
( |
) |
|
$ |
|
|||
Capital expenditures |
|
$ |
|
|
$ |
|
|
$ |
— |
|
|
$ |
|
|||
25
Nine Months Ended September 30, 2026 |
|
Electric Company |
|
|
Other |
|
|
Eliminations |
|
|
Total |
|
||||
(In millions) |
|
|
|
|
|
|
|
|
|
|
|
|
||||
Operating revenues |
|
$ |
|
|
$ |
|
|
$ |
|
|
$ |
|
||||
Fuel, purchased power and direct transmission expense |
|
|
|
|
|
|
|
|
|
|
|
|
||||
Other operation and maintenance |
|
|
|
|
|
( |
) |
|
|
|
|
|
|
|||
Depreciation and amortization |
|
|
|
|
|
|
|
|
|
|
|
|
||||
Taxes other than income |
|
|
|
|
|
|
|
|
|
|
|
|
||||
Operating income |
|
|
|
|
|
|
|
|
|
|
|
|
||||
Net other income |
|
|
|
|
|
|
|
|
( |
) |
|
|
|
|||
Interest expense |
|
|
|
|
|
|
|
|
( |
) |
|
|
|
|||
Income tax expense (benefit) |
|
|
|
|
|
( |
) |
|
|
|
|
|
|
|||
Net income (loss) |
|
$ |
|
|
$ |
( |
) |
|
$ |
|
|
$ |
|
|||
Total assets |
|
$ |
|
|
$ |
|
|
$ |
( |
) |
|
$ |
|
|||
Capital expenditures |
|
$ |
|
|
$ |
|
|
$ |
— |
|
|
$ |
|
|||
Nine Months Ended September 30, 2025 |
|
Electric Company |
|
|
Other |
|
|
Eliminations |
|
|
Total |
|
||||
(In millions) |
|
|
|
|
|
|
|
|
|
|
|
|
||||
Operating revenues |
|
$ |
|
|
$ |
|
|
$ |
|
|
$ |
|
||||
Fuel, purchased power and direct transmission expense |
|
|
|
|
|
|
|
|
|
|
|
|
||||
Other operation and maintenance |
|
|
|
|
|
|
|
|
|
|
|
|
||||
Depreciation and amortization |
|
|
|
|
|
|
|
|
|
|
|
|
||||
Taxes other than income |
|
|
|
|
|
|
|
|
|
|
|
|
||||
Operating income (loss) |
|
|
|
|
|
( |
) |
|
|
|
|
|
|
|||
Net other income |
|
|
|
|
|
|
|
|
( |
) |
|
|
|
|||
Interest expense |
|
|
|
|
|
|
|
|
( |
) |
|
|
|
|||
Income tax expense (benefit) |
|
|
|
|
|
( |
) |
|
|
|
|
|
|
|||
Net income (loss) |
|
$ |
|
|
$ |
( |
) |
|
$ |
|
|
$ |
|
|||
Total assets |
|
$ |
|
|
$ |
|
|
$ |
( |
) |
|
$ |
|
|||
Capital expenditures |
|
$ |
|
|
$ |
|
|
$ |
— |
|
|
$ |
|
|||
12. Commitments and Contingencies
Except as set forth below, in Note 13 and under "Environmental Laws and Regulations" in Item 2 of Part I and in Item 1 of Part II of this Form 10-Q, the circumstances set forth in Notes 13 and 14 to the financial statements included in the Registrants' 2025 Form 10-K appropriately represent, in all material respects, the current status of the Registrants' material commitments and contingent liabilities.
Environmental Laws and Regulations
The activities of OG&E are subject to numerous stringent and complex federal, state and local laws and regulations governing environmental protection. These laws and regulations can change, restrict or otherwise impact the Registrants' business activities in many ways, including the handling or disposal of waste material, planning for future construction activities to avoid or mitigate harm to threatened or endangered species and requiring the installation and operation of emissions or pollution control equipment. Failure to comply with these laws and regulations could result in the assessment of administrative, civil and criminal penalties, the imposition of remedial requirements and the issuance of orders enjoining future operations. Management believes that all of the Registrants' operations are in substantial compliance with current federal, state and local environmental standards.
Environmental regulation can increase the cost of planning, design, initial installation and operation of OG&E's facilities. Management continues to evaluate its compliance with existing and proposed environmental legislation and regulations and implement appropriate environmental programs in a competitive market.
26
Other
In the normal course of business, the Registrants are confronted with issues or events that may result in a contingent liability. These generally relate to lawsuits or claims made by third parties, including governmental agencies. When appropriate, management consults with legal counsel and other experts to assess the claim. If, in management's opinion, the Registrants have incurred a probable loss as set forth by GAAP, an estimate is made of the loss, and the appropriate accounting entries are reflected in the condensed financial statements. If the assessment indicates that a potential loss is not probable but reasonably possible, the nature of the contingent matter, together with an estimate of the range of possible loss if determinable and material, would be disclosed. At the present time, based on currently available information, the Registrants believe that any reasonably possible losses in excess of accrued amounts arising out of pending or threatened lawsuits or claims would not be quantitatively material to their condensed financial statements and would not have a material adverse effect on their financial position, results of operations or cash flows.
13. Rate Matters and Regulation
Except as disclosed below, the circumstances set forth in Note 14 to the financial statements included in the Registrants' 2025 Form 10-K appropriately represent, in all material respects, the current status of the Registrants' regulatory matters.
Completed Regulatory Matters
Integrated Resource Plans
As a result of the 2024 request for proposal process, OG&E has executed contracts for approximately
APSC Proceedings
2025 Arkansas Act 373 Tariff Filing
In December 2025, OG&E filed an application for approval of an Act 373 tariff to recover return on CWIP and revenue requirement for Horseshoe Lake and Tinker generation facilities. Recovery under the Act 373 tariff is dependent on a finding of eligibility for the Horseshoe Lake Units 11 and 12 and Tinker generation facilities in the prudence case disclosed below. In April 2026, the APSC issued an order approving OG&E's Act 373 tariff.
27
Arkansas Prudence of Horseshoe Lake and Tinker Generation Facilities
In December 2024, pursuant to orders in the generation construction notice filings, OG&E filed an application requesting a determination of prudence of action and initial contract costs for the generating units being constructed at Horseshoe Lake (Units 11 and 12) and Tinker Air Force Base. In May 2025, OG&E filed a supplemental application to serve as notice to the APSC of OG&E’s intent to recover the costs of these projects through a rider under the newly enacted Act 373. On September 8, 2026, the APSC issued a final order approving the prudence of action and initial contract costs for construction of the Tinker Air Force Base units and Horseshoe Lake Units 11 and 12. The APSC denied the portion of the settlement which addressed recognition of the projects as strategic investments and eligibility for recovery through a rider.
Arkansas Frontier Energy Storage Project Preapproval Filing
In February 2026, OG&E filed a preapproval case for the Frontier Energy Storage Project, which involves a purchase and sale agreement for a
FERC Proceedings
Order for Sponsored Transmission Upgrades within SPP
Under Attachment Z2 of the SPP Open Access Transmission Tariff, OG&E and others who built participant-funded, or "sponsored," transmission upgrades may recover the costs of the upgrade from other SPP customers who benefit from it. The FERC approved a waiver of a time limitation in the SPP tariff to allow the SPP in 2016 to bill for the 2008 through 2015 period due to information system limitations that had delayed that billing. The SPP then both billed users and credited sponsors, including OG&E, for Z2 charges during the period. OG&E refunded most of the net credits to customers through its various rate riders that include SPP activity and retained the remaining amounts.
Net payers of Z2 credits contested the waiver, leading the FERC to reverse its decision, deny the waiver, and instruct the SPP to refund payments made for charges from 2008 to 2015. OG&E and other net creditors challenged this reversal. However, the FERC upheld its reversal, and in August 2021 and September 2024, federal appeals courts upheld the FERC’s decisions to deny the waivers and to deny relief to OG&E and the other creditors against SPP. All appellate options have now been exhausted.
On July 16, 2026, the FERC ordered the SPP to begin invoicing OG&E and other parties for refund amounts owed. The Registrants had previously reserved $
After the initiation of the disputes discussed above, the FERC approved an SPP proposal to eliminate Attachment Z2 revenue crediting and replace it with a different rate mechanism that would provide project sponsors, such as OG&E, the same level of recovery. This elimination of the Attachment Z2 revenue crediting would only impact OG&E and its recovery of any future upgrade costs that it may incur as a project sponsor after July 2020. All projects initiated prior to July 2020 remain eligible to receive revenue credits under Attachment Z2.
28
OCC Proceedings
Oklahoma Distribution Interconnection Agreement
In May 2026, OG&E filed an application requesting approval of a pro forma Distribution Interconnection Agreement to be used for certain interconnections to OG&E’s distribution system for generators that do not have a purchase agreement for the output with OG&E and are larger than 300 kW. On August 6, 2026, the OCC issued a final order approving OG&E's application.
Oklahoma Frontier Energy Storage Project Preapproval Filing
In December 2025, OG&E filed a preapproval case for the Frontier Energy Storage Project, which involves a purchase and sale agreement for a
Pending Regulatory Matters
Various proceedings pending before state or federal regulatory agencies are described below. Unless stated otherwise, the Registrants cannot predict when the regulatory agency will act or what action the regulatory agency will take. The Registrants' financial results are dependent in part on timely and constructive decisions by the regulatory agencies that set OG&E's rates.
SPP Proceedings
Demand Response Accreditation and Peak Demand Assessment
The SPP has proposed performance-based demand response accreditation and a peak demand assessment that would compare each LRE's forecasted peak demand with its actual peak demand. An LRE that under-forecasts its peak demand could be required to make a deficiency payment. Demand response resources would qualify through market or reliability registration and dispatch, while programs included in an LRE's forecast as load modifiers could reduce its planning reserve margin requirements. In February 2026, the SPP Regional State Committee and the SPP Board of Directors approved implementation of a load modifier cap in 2027 and full implementation of the demand response accreditation and peak demand assessment policies in 2028. These policies are subject to FERC review and approval prior to implementation. In August 2026, the FERC issued a Deficiency Letter requiring the SPP to address questions and concerns regarding the lack of detail in the proposed tariff change and potential inequities in its administration. On October 9, 2026, several LREs, including OG&E, filed comments requesting that the proposal be rejected or, at minimum, delayed. If approved by the FERC, the demand response changes would require OG&E to alter its current load reduction program and may require OG&E to procure additional capacity resources, and the peak demand assessment could create deficiency payment risk, as discussed above, if OG&E’s peak demand is under-forecasted.
Seminole to Longwood Transmission Line
At the end of 2025, the SPP Board of Directors adopted their 2025 Integrated Transmission Plan. This plan included a new 765 kV transmission line running from Konawa, Oklahoma to Shreveport, Louisiana. OG&E will construct and own a significant portion of the line. The project is pending OG&E's receipt and acceptance of a notice to construct, which is expected in the coming months.
APSC Proceedings
2025 Arkansas Preapproval Case
In July 2025, OG&E filed an application requesting several approvals from the APSC relating to three capacity projects arising from the 2024 request for proposals for generating capacity: (i) the Black Kettle Battery Storage CPA; (ii) the Kiamichi natural gas CPA; and (iii) construction of two additional combustion turbines at the Horseshoe Lake generating facility (Units 13 and 14). OG&E sought authority to begin construction of the Horseshoe Lake units, a prudency determination of those new Horseshoe Lake units, authorization to enter into the Black Kettle Battery Storage CPA and other findings needed under Arkansas law, including eligibility to recover costs of the new Horseshoe Lake units through a rider under the newly enacted Act 373. In November 2025, OG&E and the
29
APSC staff filed a settlement agreement approving OG&E’s application with some additional reporting requirements and allowing an additional return on the Black Kettle Battery Storage CPA at the 20-year U.S. treasury rate. In December 2025, the Attorney General filed testimony in opposition to the settlement. In January 2026, the APSC issued an order denying the settlement agreement and denying preapproval of Horseshoe Lake Units 13 and 14 but approving the Black Kettle Battery Storage CPA. The APSC also found that OG&E did not need to seek approval of the Kiamichi natural gas CPA since the term is shorter than five years. In the order, the APSC stated OG&E could still seek a prudence determination and cost recovery of Horseshoe Lake Units 13 and 14 after they are placed into service. In February 2026, OG&E filed additional evidence pursuant to Arkansas law and requested that the APSC consider the additional evidence in finding that Horseshoe Lake Units 13 and 14 are reasonable, necessary and in the public interest. In March 2026, the APSC issued an order which again declined to grant prudence of Horseshoe Lake Units 13 and 14 but clarified that OG&E is authorized to begin construction and the APSC's previous order should not be construed to indicate prudence or imprudence. The APSC re-stated that OG&E may request approval for Horseshoe Lake Units 13 and 14 in a future rate case. Parties have filed comments in response to questions posed by the APSC's March 2026 order, and OG&E is awaiting further action from the APSC.
Arkansas Long-term CPAs
In July 2026, OG&E filed its application and direct testimony to seek approval for two long-term CPAs as presented in the Oklahoma Google special contract case, which is further discussed below. On October 15, 2026, the APSC Staff filed direct testimony recommending denial of the CPAs, stating that OG&E did not provide sufficient evidence that the pricing is reasonable and prudent. OG&E is preparing rebuttal testimony and awaiting a procedural schedule from the APSC.
FERC Proceedings
Integration of Large and Co-Located Loads
In June 2026, the FERC issued an order instituting a Section 206 show cause proceeding directed at the SPP and named the SPP transmission owners, including OG&E, preliminarily finding that the SPP’s tariff appears to be unjust, unreasonable, or unduly discriminatory or preferential regarding the integration of large and co-located loads onto the SPP transmission system. The SPP and the SPP transmission owners were directed to either: (i) show cause why the tariff remains just and reasonable; or (ii) explain what tariff changes would remedy the concerns identified by the FERC. The FERC’s concerns involved transmission service for large loads, cost transparency, cost recovery agreements, co-location arrangements and eligible load, flexible large loads, and resource adequacy/generation sufficiency. In August 2026, certain SPP transmission owners, including OG&E, filed a motion requesting the FERC hold the show cause proceeding in abeyance to November 20, 2026, pending completion of the SPP’s stakeholder proceedings and the submittal of a Section 205 filing to address the FERC’s preliminary findings. In August 2026, the FERC granted the motion of holding the proceeding in abeyance, with responses to the June 2026 order due on November 20, 2026, and answers to responses due on December 21, 2026. The FERC's final determination could result in changes to certain OG&E tariff provisions.
OCC Proceedings
Oklahoma CWIP Filing
In December 2025, OG&E filed an application for CWIP treatment for Horseshoe Lake combustion turbines Units 13 and 14, as allowed by Oklahoma Senate Bill 998. A motion to dismiss the case was filed by the Oklahoma Industrial Energy Consumers, as well as the Public Utility Division Staff. OG&E filed a response as well as motions to move the case and all outstanding motions to be heard en banc. These motions were heard before the OCC in January 2026. In March 2026, the OCC issued an order dismissing the case, and on the same day, OG&E filed an appeal at the Oklahoma Supreme Court. The case is now fully briefed and is awaiting a decision from the Oklahoma Supreme Court.
Oklahoma 2025 Fuel Prudence
In April 2026, the Public Utility Division Staff filed their application initiating the prudence review of the 2025 fuel adjustment clause. OG&E filed its direct testimony and minimum filing requirements in June 2026. Responsive testimony from the OCC Staff was filed in August 2026, and a hearing occurred on October 8, 2026. At the conclusion of the hearing, the ALJ recommended the OCC find OG&E's fuel procurement policies and practices prudent and costs calculated accurately for the calendar year 2025.
30
Oklahoma Google Special Contract
In May 2026, OG&E filed an application requesting approval of a special contract with Google and preapproval of two CPAs. The special contract includes provisions such as long-term contract commitments, minimum billing demand and energy charges, funding of upfront costs, and recognizing OCC authority to review and address any potential adverse rate impact in future rate proceedings through cost-of-service adjustments. Further, as part of the special contract, OG&E secured power generation capacity agreements from two solar facilities that Google currently has under construction. On September 9, 2026, a non-contested settlement agreement was reached between OG&E, the Oklahoma Attorney General, the Public Utility Division and Google. At the hearing on the merits, the ALJ recommended approval of the special contract and the two CPAs.
Oklahoma Large Load Tariff
Separately from the Google special contract, in June 2026, OG&E filed an application requesting approval of its new proposed XLPL tariff and terms and conditions of service for extra large load customers and for approval of a regulatory asset to recover costs associated with portfolio optimization software. If approved, this tariff would establish a framework to serve large load customers (
2026 Oklahoma General Rate Review
On September 30, 2026, OG&E filed a general rate review in Oklahoma seeking a rate increase of $
31
Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations.
The following combined discussion is separately filed by OGE Energy and OG&E. However, OG&E does not make any representations as to information related solely to OGE Energy or the subsidiaries of OGE Energy other than itself.
Introduction and Overview
OGE Energy is a holding company whose primary investment provides electricity in Oklahoma and western Arkansas. OGE Energy's electric company operations are conducted through its wholly-owned subsidiary, OG&E, which generates, transmits, distributes and sells electric energy in Oklahoma and western Arkansas and are reported through OGE Energy's electric company business segment. OG&E's rates are subject to regulation by the OCC, the APSC and the FERC. OG&E was incorporated in 1902 under the laws of the Oklahoma Territory and is the largest electric company in Oklahoma, with a franchised service territory that includes Fort Smith, Arkansas and the surrounding communities. OG&E sold its retail natural gas business in 1928 and is no longer engaged in the natural gas distribution business.
The accounts of OGE Energy and its wholly-owned subsidiaries, including OG&E, are included in OGE Energy's condensed consolidated financial statements. All intercompany transactions and balances are eliminated in such consolidation.
OGE Energy's purpose is to energize life, providing life-sustaining and life-enhancing products and services that enrich its communities, encouraging growth and a higher quality of life. OGE Energy's purpose comes with a balanced approach to multifaceted stewardship: keeping its employees (internally referred to as "members") safe, reducing its environmental impact, strengthening its diverse communities and ensuring its effective corporate governance. OGE Energy's business model is centered around growth and sustainability for members, communities and customers and the owners of OGE Energy, its shareholders. OGE Energy is focused on creating long-term shareholder value by targeting the consistent growth of consolidated earnings per share of five to seven percent through 2030, and consolidated earnings per share in the top half of the range in 2027 and 2028, supported by expected strong load growth enabled by low customer rates and a strategy of investing in lower risk infrastructure projects that improve the economic vitality of the communities it serves in Oklahoma and Arkansas. In September 2026, OGE Energy updated its target dividend payout ratio to 55 percent to 60 percent and continues to expect earnings per share growth to exceed the dividend growth rate to help achieve this target. OGE Energy's long-term sustainability is predicated on providing exceptional customer engagement, strengthening the energy grid, investing in proven technologies to meet generation capacity needs, environmental stewardship, strong governance practices and caring for and supporting its members and communities. Further discussion of OGE Energy's strategy can be found in its 2025 Form 10-K.
Recent Developments
OG&E's Regulatory Matters
Current activity related to OG&E's regulatory matters is discussed in Note 13 within "Item 1. Financial Statements."
Summary of OGE Energy Operating Results
Three Months Ended September 30, 2026 as compared to the Three Months Ended September 30, 2025
OGE Energy's net income was $316.2 million, or $1.52 per diluted share, during the three months ended September 30, 2026 as compared to $231.3 million, or $1.14 per diluted share, during the same period in 2025. The increase in net income of $84.9 million, or $0.38 per diluted share, is further discussed below.
32
Nine Months Ended September 30, 2026 as compared to the Nine Months Ended September 30, 2025
OGE Energy's net income was $482.7 million, or $2.32 per diluted share, during the nine months ended September 30, 2026 as compared to $401.5 million, or $1.99 per diluted share, during the same period in 2025. The increase in net income of $81.2 million, or $0.33 per diluted share, is further discussed below.
2026 Outlook
Due to warmer than normal weather, OGE Energy’s consolidated earnings are expected to be in the range of $2.62 to $2.68 per average diluted share. This guidance assumes, among other things, approximately 207.3 million average diluted shares outstanding and normal weather for the remainder of the year. OG&E has significant seasonality in its earnings due to weather on a year-over-year basis. See OGE Energy's 2025 Form 10-K for other key factors and assumptions underlying its 2026 guidance.
Results of Operations
The following discussion and analysis presents factors that affected the Registrants' results of operations for the three and nine months ended September 30, 2026 as compared to the same periods in 2025 and the Registrants' financial position at September 30, 2026. Due to seasonal fluctuations and other factors, the Registrants' operating results for the three and nine months ended September 30, 2026 are not necessarily indicative of the results that may be expected for the year ending December 31, 2026 or for any future period. The following information should be read in conjunction with the condensed financial statements and notes thereto. Known trends and contingencies of a material nature are discussed to the extent considered relevant.
|
|
Three Months Ended |
|
|
Nine Months Ended |
|
||||||||||
OGE Energy |
|
September 30, |
|
|
September 30, |
|
||||||||||
(In millions, except per share data) |
|
2026 |
|
|
2025 |
|
|
2026 |
|
|
2025 |
|
||||
Net income |
|
$ |
316.2 |
|
|
$ |
231.3 |
|
|
$ |
482.7 |
|
|
$ |
401.5 |
|
Basic average common shares outstanding |
|
|
206.7 |
|
|
|
201.5 |
|
|
|
206.5 |
|
|
|
201.3 |
|
Diluted average common shares outstanding |
|
|
208.2 |
|
|
|
202.1 |
|
|
|
207.7 |
|
|
|
202.0 |
|
Basic earnings per average common share |
|
$ |
1.53 |
|
|
$ |
1.15 |
|
|
$ |
2.34 |
|
|
$ |
1.99 |
|
Diluted earnings per average common share |
|
$ |
1.52 |
|
|
$ |
1.14 |
|
|
$ |
2.32 |
|
|
$ |
1.99 |
|
Dividends declared per common share |
|
$ |
0.42875 |
|
|
$ |
0.42500 |
|
|
$ |
1.27875 |
|
|
$ |
1.26750 |
|
Results by Business Segment
|
|
Three Months Ended |
|
|
Nine Months Ended |
|
||||||||||
|
|
September 30, |
|
|
September 30, |
|
||||||||||
(In millions) |
|
2026 |
|
|
2025 |
|
|
2026 |
|
|
2025 |
|
||||
Net income (loss): |
|
|
|
|
|
|
|
|
|
|
|
|
||||
OG&E (Electric Company) |
|
$ |
320.9 |
|
|
$ |
242.9 |
|
|
$ |
498.9 |
|
|
$ |
421.6 |
|
Other operations |
|
|
(4.7 |
) |
|
|
(11.6 |
) |
|
|
(16.2 |
) |
|
|
(20.1 |
) |
OGE Energy net income |
|
$ |
316.2 |
|
|
$ |
231.3 |
|
|
$ |
482.7 |
|
|
$ |
401.5 |
|
The following discussion of results of operations for OG&E includes intercompany transactions that are eliminated in OGE Energy's condensed consolidated financial statements.
33
OG&E (Electric Company)
|
|
Three Months Ended |
|
|
Nine Months Ended |
|
||||||||||
|
|
September 30, |
|
|
September 30, |
|
||||||||||
(Dollars in millions) |
|
2026 |
|
|
2025 |
|
|
2026 |
|
|
2025 |
|
||||
Operating revenues |
|
$ |
1,182.8 |
|
|
$ |
1,045.0 |
|
|
$ |
2,647.3 |
|
|
$ |
2,534.3 |
|
Fuel, purchased power and direct transmission expense |
|
|
441.2 |
|
|
|
388.5 |
|
|
|
995.6 |
|
|
|
973.6 |
|
Other operation and maintenance |
|
|
137.1 |
|
|
|
143.5 |
|
|
|
412.5 |
|
|
|
391.6 |
|
Depreciation and amortization |
|
|
149.2 |
|
|
|
146.7 |
|
|
|
423.7 |
|
|
|
424.7 |
|
Taxes other than income |
|
|
26.8 |
|
|
|
25.2 |
|
|
|
82.5 |
|
|
|
82.6 |
|
Operating income |
|
|
428.5 |
|
|
|
341.1 |
|
|
|
733.0 |
|
|
|
661.8 |
|
Allowance for equity funds used during construction |
|
|
7.4 |
|
|
|
6.3 |
|
|
|
22.2 |
|
|
|
19.3 |
|
Other net periodic benefit expense |
|
|
(2.5 |
) |
|
|
(2.7 |
) |
|
|
(7.5 |
) |
|
|
(7.8 |
) |
Other income |
|
|
8.4 |
|
|
|
4.2 |
|
|
|
17.5 |
|
|
|
13.6 |
|
Other expense |
|
|
0.8 |
|
|
|
0.5 |
|
|
|
2.2 |
|
|
|
1.9 |
|
Interest expense |
|
|
55.7 |
|
|
|
54.2 |
|
|
|
164.1 |
|
|
|
174.4 |
|
Income tax expense |
|
|
64.4 |
|
|
|
51.3 |
|
|
|
100.0 |
|
|
|
89.0 |
|
Net income |
|
$ |
320.9 |
|
|
$ |
242.9 |
|
|
$ |
498.9 |
|
|
$ |
421.6 |
|
Operating revenues by classification: |
|
|
|
|
|
|
|
|
|
|
|
|
||||
Residential |
|
$ |
523.2 |
|
|
$ |
408.0 |
|
|
$ |
1,044.7 |
|
|
$ |
956.3 |
|
Commercial |
|
|
346.3 |
|
|
|
319.1 |
|
|
|
773.9 |
|
|
|
753.8 |
|
Industrial |
|
|
87.5 |
|
|
|
81.6 |
|
|
|
204.7 |
|
|
|
204.0 |
|
Oilfield |
|
|
79.3 |
|
|
|
73.1 |
|
|
|
187.0 |
|
|
|
185.5 |
|
Public authorities and street light |
|
|
99.3 |
|
|
|
87.7 |
|
|
|
223.5 |
|
|
|
213.0 |
|
System sales revenues |
|
|
1,135.6 |
|
|
|
969.5 |
|
|
|
2,433.8 |
|
|
|
2,312.6 |
|
Provision for rate refund |
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
3.0 |
|
Integrated market |
|
|
29.3 |
|
|
|
23.6 |
|
|
|
104.0 |
|
|
|
71.2 |
|
Transmission |
|
|
12.7 |
|
|
|
38.8 |
|
|
|
83.9 |
|
|
|
120.7 |
|
Other |
|
|
5.2 |
|
|
|
13.1 |
|
|
|
25.6 |
|
|
|
26.8 |
|
Total operating revenues |
|
$ |
1,182.8 |
|
|
$ |
1,045.0 |
|
|
$ |
2,647.3 |
|
|
$ |
2,534.3 |
|
MWh sales by classification (In millions) |
|
|
|
|
|
|
|
|
|
|
|
|
||||
Residential |
|
|
3.9 |
|
|
|
3.1 |
|
|
|
8.3 |
|
|
|
7.7 |
|
Commercial |
|
|
3.6 |
|
|
|
3.5 |
|
|
|
9.7 |
|
|
|
9.3 |
|
Industrial |
|
|
1.1 |
|
|
|
1.1 |
|
|
|
3.1 |
|
|
|
3.1 |
|
Oilfield |
|
|
1.1 |
|
|
|
1.1 |
|
|
|
3.3 |
|
|
|
3.2 |
|
Public authorities and street light |
|
|
1.0 |
|
|
|
0.9 |
|
|
|
2.4 |
|
|
|
2.3 |
|
System sales |
|
|
10.7 |
|
|
|
9.7 |
|
|
|
26.8 |
|
|
|
25.6 |
|
Integrated market |
|
|
0.4 |
|
|
|
0.2 |
|
|
|
1.1 |
|
|
|
0.6 |
|
Total sales |
|
|
11.1 |
|
|
|
9.9 |
|
|
|
27.9 |
|
|
|
26.2 |
|
Number of customers |
|
|
918,559 |
|
|
|
910,464 |
|
|
|
918,559 |
|
|
|
910,464 |
|
Weighted-average cost of energy per kilowatt-hour (In cents) |
|
|
|
|
|
|
|
|
|
|
|
|
||||
Natural gas |
|
|
2.954 |
|
|
|
3.190 |
|
|
|
3.959 |
|
|
|
3.704 |
|
Coal |
|
|
2.647 |
|
|
|
2.765 |
|
|
|
2.633 |
|
|
|
2.759 |
|
Total fuel |
|
|
2.759 |
|
|
|
2.965 |
|
|
|
3.403 |
|
|
|
3.243 |
|
Total fuel and purchased power |
|
|
3.836 |
|
|
|
3.732 |
|
|
|
3.440 |
|
|
|
3.549 |
|
Degree days (A) |
|
|
|
|
|
|
|
|
|
|
|
|
||||
Heating - Actual |
|
|
— |
|
|
|
— |
|
|
|
1,510 |
|
|
|
2,056 |
|
Heating - Normal |
|
|
19 |
|
|
|
19 |
|
|
|
2,158 |
|
|
|
2,158 |
|
Cooling - Actual |
|
|
1,897 |
|
|
|
1,288 |
|
|
|
2,761 |
|
|
|
1,886 |
|
Cooling - Normal |
|
|
1,265 |
|
|
|
1,265 |
|
|
|
1,828 |
|
|
|
1,828 |
|
34
OG&E's net income increased $78.0 million, or 32.1 percent, and $77.3 million, or 18.3 percent, during the three and nine months ended September 30, 2026, respectively, as compared to the same periods in 2025. The following section discusses the primary drivers for the changes in net income during the three and nine months ended September 30, 2026 as compared to the same periods in 2025.
Operating revenues increased $137.8 million, or 13.2 percent, and $113.0 million, or 4.5 percent, during the three and nine months ended September 30, 2026, respectively, primarily driven by the below factors.
(In millions) |
|
Three Months Ended |
|
|
Nine Months Ended |
|
||
Quantity impacts (primarily weather) (A) |
|
$ |
68.9 |
|
|
$ |
53.2 |
|
Fuel, purchased power and direct transmission expense (B) |
|
|
52.7 |
|
|
|
22.0 |
|
Price variance (C) |
|
|
19.2 |
|
|
|
32.6 |
|
New customer growth |
|
|
6.0 |
|
|
|
11.9 |
|
Non-residential demand and related revenues |
|
|
1.2 |
|
|
|
9.0 |
|
Industrial and oilfield sales |
|
|
(0.3 |
) |
|
|
0.1 |
|
Other |
|
|
(0.3 |
) |
|
|
0.3 |
|
Wholesale transmission revenue (D) |
|
|
(2.1 |
) |
|
|
(14.9 |
) |
Guaranteed Flat Bill program (E) |
|
|
(7.5 |
) |
|
|
(1.2 |
) |
Change in operating revenues |
|
$ |
137.8 |
|
|
$ |
113.0 |
|
Fuel, purchased power and direct transmission expense for OG&E consists of fuel used in electric generation, purchased power and transmission related charges. As described above, the actual cost of fuel used in electric generation and certain purchased power costs are generally recoverable from OG&E's customers through fuel adjustment clauses. The fuel adjustment clauses are subject to periodic review by the OCC and the APSC. OG&E's fuel, purchased power and direct transmission expense increased $52.7 million, or 13.6 percent, and $22.0 million, or 2.3 percent, during the three and nine months ended September 30, 2026, respectively, primarily driven by the below factors.
(In millions) |
Three Months Ended |
|
Nine Months Ended |
|
||
Fuel expense (A) |
$ |
25.7 |
|
$ |
54.3 |
|
Purchased power costs: |
|
|
|
|
||
Purchases from SPP (B) |
|
25.5 |
|
|
(42.6 |
) |
Capacity |
|
5.5 |
|
|
8.1 |
|
Wind |
|
1.4 |
|
|
2.4 |
|
Other |
|
(0.3 |
) |
|
1.3 |
|
Transmission expense |
|
(5.1 |
) |
|
(1.5 |
) |
Change in fuel, purchased power and direct transmission expense |
$ |
52.7 |
|
$ |
22.0 |
|
35
Other operation and maintenance expense decreased $6.4 million, or 4.5 percent, during the three months ended September 30, 2026, primarily due to a decrease in contract technical and construction services driven by the timing of certain projects, vegetation management timing and a decrease in software expense, partially offset by an increase in payroll and benefits net of capitalized labor. Other operation and maintenance expense increased $20.9 million, or 5.3 percent, during the nine months ended September 30, 2026, primarily due to an increase in payroll and benefits net of capitalized labor, energy efficiency program activities and services which are recoverable through riders, and contract professional services.
Depreciation and amortization expense increased $2.5 million, or 1.7 percent, during the three months ended September 30, 2026, primarily due to additional assets being placed into service, partially offset by deferrals of allowable depreciation and amortization expense of $13.2 million to a regulatory asset in accordance with Oklahoma PISA. Depreciation and amortization expense decreased $1.0 million, or 0.2 percent, during the nine months ended September 30, 2026, primarily due to deferrals of allowable depreciation and amortization expense of $36.4 million to a regulatory asset in accordance with Oklahoma PISA, partially offset by additional assets being placed into service.
Net other income increased $5.2 million, or 71.2 percent, and $6.8 million, or 29.3 percent, during the three and nine months ended September 30, 2026, respectively, primarily due to increased allowance for equity funds used during construction driven by higher construction work in progress balances resulting from increased spending for generation projects, partially offset by lower interest income related to the carrying charge for the fuel under recovery balance in 2025.
Interest expense increased $1.5 million, or 2.8 percent, during the three months ended September 30, 2026, primarily due to interest expense related to the $350.0 million senior notes issuance in April 2026, partially offset by the deferral of certain interest expense to a regulatory asset in accordance with Oklahoma PISA. Interest expense decreased $10.3 million, or 5.9 percent, during the nine months ended September 30, 2026, primarily due to the deferral of certain interest expense to a regulatory asset in accordance with Oklahoma PISA, partially offset by interest expense related to the $350.0 million senior notes issuances in April 2025 and April 2026.
Income tax expense increased $13.1 million, or 25.5 percent, and $11.0 million, or 12.4 percent, during the three and nine months ended September 30, 2026, respectively, primarily due to higher pretax income, partially offset by a benefit in amortization of net refundable deferred taxes and additional state tax credits generated.
Liquidity and Capital Resources
Cash Flows
OGE Energy
|
|
Nine Months Ended |
|
|
|
|
|
|
|
|||||||
|
|
September 30, |
|
|
2026 vs. 2025 |
|
||||||||||
(Dollars in millions) |
|
2026 |
|
|
2025 |
|
|
$ Change |
|
|
% Change |
|
||||
Net cash provided from operating activities (A) |
|
$ |
894.1 |
|
|
$ |
752.3 |
|
|
$ |
141.8 |
|
|
|
18.8 |
% |
Net cash used in investing activities (B) |
|
$ |
(827.3 |
) |
|
$ |
(806.8 |
) |
|
$ |
(20.5 |
) |
|
|
2.5 |
% |
Net cash (used in) provided from financing activities (C) |
|
$ |
(66.8 |
) |
|
$ |
54.2 |
|
|
$ |
(121.0 |
) |
|
* |
|
|
* Change is greater than 100%.
Working Capital
Working capital is defined as the difference in current assets and current liabilities. OGE Energy's working capital requirements are driven generally by changes in accounts receivable, accounts payable, commodity prices, credit extended to and the timing of collections from OG&E's customers, the level and timing of spending for maintenance and expansion activity, inventory levels and fuel recoveries. The following discussion addresses changes in OGE Energy's working capital balances at September 30, 2026 compared to December 31, 2025.
36
Accounts Receivable and Accrued Unbilled Revenues increased $147.2 million, or 34.7 percent, primarily due to an increase in billings to OG&E's retail customers reflecting higher seasonal usage in September 2026 compared to December 2025.
Income Taxes Receivable decreased $37.2 million, or 99.7 percent, primarily due to an increase in federal taxes owed.
Fuel Inventories decreased $29.3 million, or 26.2 percent, primarily due to net withdrawals of coal.
Materials and Supplies, at Average Cost increased $50.4 million, or 23.7 percent, primarily due to increased plant inventory.
Short-term Debt decreased $156.9 million, or 53.7 percent, primarily due to OG&E's $350.0 million senior notes issuance in April 2026, which was used to pay down short-term debt along with general operating needs. The Registrants borrow on a short-term basis, as necessary, through the issuance of commercial paper under their revolving credit agreements.
Accounts Payable decreased $57.0 million, or 16.3 percent, primarily due to the timing of vendor payments, partially offset by an increase in purchased power and integrated market payables.
Accrued Taxes increased $25.9 million, or 48.9 percent, primarily resulting from the timing of payments for ad valorem and federal tax liabilities.
Accrued Interest increased $24.1 million, or 35.0 percent, primarily due to the issuance of OG&E's $350.0 million senior notes in April 2026, as well as the timing of interest payments and accruals.
Long-Term Debt due within One Year increased $180.9 million, primarily due to the reclassification of OG&E's industrial authority bonds scheduled to mature in June 2027 and OG&E's $125.0 million senior notes scheduled to mature in July 2027.
Fuel Clause Over Recoveries increased $31.9 million, primarily due to higher recoveries from OG&E retail customers as compared to the actual cost of fuel and purchased power.
Other Current Liabilities increased $74.7 million, primarily due to increases in SPP projected payables and under recovered riders.
Future Material Cash Requirements
OGE Energy's primary, material cash requirements are related to acquiring or constructing new facilities and replacing or expanding existing facilities at OG&E. Other working capital requirements include items such as maturing debt, operating lease obligations, fuel clause under recoveries and other general corporate purposes. Further, working capital requirements can be seasonal. OGE Energy generally meets its cash needs through a combination of cash generated from operations, short-term borrowings (through a combination of bank borrowings and commercial paper) and permanent financings. OGE Energy believes its cash flows from operations, existing borrowing capacity, and access to debt and equity capital markets, as needed, should be sufficient to satisfy material cash requirements over the short-term and long-term.
Capital Expenditures
OGE Energy's updated estimates of capital expenditures for the years 2026 through 2030 presented in the following table reflect an increase from the amounts included within "Item 7. Management's Discussion and Analysis of Financial Condition and Results of Operations" in the Registrants' 2025 Form 10-K and are discussed further in the footnotes below the table. The capital investments, which represent base maintenance capital expenditures plus capital expenditures for known and committed projects, are customer-focused and targeted to maintain and improve the safety, resiliency and reliability of OG&E's distribution and transmission grid and generation fleet, enhance the ability of OG&E's system to perform during extreme weather events and to serve OG&E's growing customer base.
37
(In millions) |
2026 |
|
2027 |
|
2028 |
|
2029 |
|
2030 |
|
Total |
|
||||||
Transmission (A)(B) |
$ |
200 |
|
$ |
360 |
|
$ |
355 |
|
$ |
320 |
|
$ |
250 |
|
$ |
1,485 |
|
Oklahoma distribution |
|
585 |
|
|
705 |
|
|
725 |
|
|
775 |
|
|
825 |
|
|
3,615 |
|
Arkansas distribution |
|
45 |
|
|
25 |
|
|
25 |
|
|
25 |
|
|
25 |
|
|
145 |
|
Generation reliability |
|
245 |
|
|
160 |
|
|
165 |
|
|
165 |
|
|
165 |
|
|
900 |
|
Generation capacity projects (C)(D) |
|
180 |
|
|
585 |
|
|
165 |
|
|
65 |
|
|
— |
|
|
995 |
|
Technology, fleet & facilities |
|
130 |
|
|
135 |
|
|
145 |
|
|
145 |
|
|
145 |
|
|
700 |
|
Total |
$ |
1,385 |
|
$ |
1,970 |
|
$ |
1,580 |
|
$ |
1,495 |
|
$ |
1,410 |
|
$ |
7,840 |
|
Additional capital expenditures beyond those identified in the table above, including additional incremental growth opportunities, will be evaluated based upon the requirements of OG&E's power supply, transmission and distribution operational teams and the expected resultant customer benefits. The annual level of investments in the transmission and distribution system could vary depending on the amount and timing of incremental generation capacity investments.
Financing Activities and Future Sources of Financing
Management expects that cash generated from operations, proceeds from the issuance of long- and short-term debt, proceeds from the settlement of the FSAs, sales of common stock to the public, including through OGE Energy's Automatic Dividend Reinvestment and Stock Purchase Plan, or other offerings will be adequate over the short-term and the long-term to meet anticipated cash needs and to fund future growth opportunities. OGE Energy utilizes short-term borrowings (through a combination of bank borrowings and commercial paper) to satisfy temporary working capital needs and as an interim source of financing capital expenditures until permanent financing is arranged.
Short-Term Debt and Credit Facilities
OGE Energy borrows on a short-term basis, as necessary, by issuance of commercial paper and borrowings under its revolving credit agreements.
On June 12, 2026, OGE Energy and OG&E entered into new, unsecured five-year revolving credit facilities totaling $1.3 billion ($650.0 million for OGE Energy and $650.0 million for OG&E), which can also be used as letter of credit facilities. OGE Energy also has a $120.0 million floating rate unsecured three-year credit agreement, of which $60.0 million is considered a revolving loan. The following table presents information about OGE Energy's revolving credit agreements at September 30, 2026.
(Dollars in millions) |
|
September 30, 2026 |
|
|
Balance of outstanding supporting letters of credit |
|
$ |
0.4 |
|
Weighted-average interest rate of outstanding supporting letters of credit |
|
|
1.20 |
% |
Net available liquidity under revolving credit agreements, commercial paper borrowings and letters of credit |
|
$ |
1,224.5 |
|
Balance of cash and cash equivalents |
|
$ |
0.2 |
|
38
The following table presents information about OGE Energy's total short-term debt activity for the three and nine months ended September 30, 2026.
(Dollars in millions) |
|
Three Months Ended September 30, 2026 |
|
|
Nine Months Ended September 30, 2026 |
|
||
Average balance of short-term debt |
|
$ |
118.7 |
|
|
$ |
254.6 |
|
Weighted-average interest rate of average balance of short-term debt |
|
|
4.04 |
% |
|
|
4.01 |
% |
Maximum month-end balance of short-term debt |
|
$ |
167.8 |
|
|
$ |
516.5 |
|
OG&E must obtain regulatory approval from the FERC in order to borrow on a short-term basis. OG&E has the necessary regulatory approvals to incur up to $1.0 billion in short-term borrowings at any one time for a two-year period beginning January 1, 2025 and ending December 31, 2026. OG&E has requested approval from the FERC to incur up to $1.5 billion for the two-year period beginning January 1, 2027 and ending December 31, 2028 and expects to receive approval prior to the expiration of its current authority.
Issuance of Long-Term Debt
On April 1, 2026, OG&E issued $350.0 million of 5.90 percent senior notes due April 1, 2056. The proceeds from this issuance were added to OG&E's general funds and used for general corporate purposes, including repayment of short-term debt, repayment of borrowings under OG&E's revolving credit facility, and funding of OG&E's capital investment program and working capital needs.
Security Ratings
Access to reasonably priced capital is dependent in part on credit and security ratings. Generally, lower ratings lead to higher financing costs. Pricing grids associated with OGE Energy's credit facilities could cause annual fees and borrowing rates to increase if an adverse rating impact occurs. The impact of any future downgrade could include an increase in the costs of OGE Energy's short-term borrowings, but a reduction in OGE Energy's credit ratings would not result in any defaults or accelerations. Any future downgrade could also lead to higher long-term borrowing costs and, if below investment grade, would require OGE Energy to post collateral or letters of credit.
A security rating is not a recommendation to buy, sell or hold securities. Such rating may be subject to revision or withdrawal at any time by the credit rating agency, and each rating should be evaluated independently of any other rating.
On April 20, 2026, Moody's Investors Service revised their ratings outlook on both OGE Energy and OG&E to stable from negative. Moody's Investors Service indicated the stabilization of outlooks reflects an expectation that OGE Energy and OG&E will maintain adequate financial metrics over the next few years that are consistent with current rating levels.
Common Stock
In November 2025, OGE Energy entered into FSAs in connection with a completed public offering of 9,226,744 shares of its common stock. The 4,613,372 shares that are subject to the FSAs provide for settlement on a settlement date or dates to be specified at OGE Energy’s discretion on or prior to May 27, 2027. The forward sale price was initially $41.71 per share and is subject to adjustment based on a floating interest rate factor equal to the overnight bank funding rate less a spread and less expected dividends on OGE Energy's common stock during the period the instruments are outstanding. See Note 7 within "Item 1. Financial Statements" for further discussion.
OGE Energy expects to establish an at-the-market equity program of up to $750 million under which it may sell shares of its common stock from time to time, including through forward sales agreements.
39
Critical Accounting Policies and Estimates
The condensed financial statements and notes thereto contain information that is pertinent to Management's Discussion and Analysis of Financial Condition and Results of Operations. In preparing the condensed financial statements, management is required to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and contingent liabilities at the date of the condensed financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates. Changes to these assumptions and estimates could have a material effect on the condensed financial statements. The Registrants believe they have taken reasonable positions where assumptions and estimates are used in order to minimize the negative financial impact to the Registrants that could result if actual results vary from the assumptions and estimates.
In management's opinion, the areas where the most significant judgment is exercised include the determination of pension and postretirement plan assumptions, income taxes, contingency reserves, and regulatory assets and liabilities. The selection, application and disclosure of the critical accounting estimates have been discussed with the Audit Committee of OGE Energy's Board of Directors and are discussed in detail within "Item 7. Management's Discussion and Analysis of Financial Condition and Results of Operations" in the Registrants' 2025 Form 10-K.
Commitments and Contingencies
In the normal course of business, the Registrants are confronted with issues or events that may result in a contingent liability. These generally relate to lawsuits or claims made by third parties, including governmental agencies. When appropriate, management consults with legal counsel and other experts to assess the claim. If, in management's opinion, the Registrants have incurred a probable loss as set forth by GAAP, an estimate is made of the loss, and the appropriate accounting entries are reflected in the condensed financial statements. If the assessment indicates that a potential loss is not probable but reasonably possible, the nature of the contingent matter, together with an estimate of the range of possible loss if determinable and material, would be disclosed. At the present time, based on currently available information, the Registrants believe that any reasonably possible losses in excess of accrued amounts arising out of pending or threatened lawsuits or claims would not be quantitatively material to their condensed financial statements and would not have a material adverse effect on their financial position, results of operations or cash flows. See Notes 12 and 13 within "Item 1. Financial Statements" for further discussion of the Registrants' commitments and contingencies.
Environmental Laws and Regulations
The activities of OG&E are subject to numerous stringent and complex federal, state and local laws and regulations governing environmental protection. These laws and regulations can change, restrict or otherwise impact the Registrants' business activities in many ways, including the handling or disposal of waste material, planning for future construction activities to avoid or mitigate harm to threatened or endangered species and requiring the installation and operation of emissions or pollution control equipment. Failure to comply with these laws and regulations could result in the assessment of administrative, civil and criminal penalties, the imposition of remedial requirements and the issuance of orders enjoining future operations. Management believes that OG&E's operations are in substantial compliance with current federal, state and local environmental standards. Future developments, such as changes in existing laws, introduction of new laws or regulations, or the emergence of new facts or conditions, may result in significant changes to anticipated costs for the Registrants.
Environmental regulation can increase the cost of planning, design, initial installation and operation of OG&E's facilities. Management continues to evaluate its compliance with existing and proposed environmental legislation and regulations and implement appropriate environmental programs in a competitive market.
Air
OG&E's operations are subject to the Federal Clean Air Act of 1970, as amended, and comparable state laws and regulations. These laws regulate air pollutant emissions from industrial sources, including electric generating units, and require monitoring and reporting. These laws and regulations may require OG&E to secure pre-approval for constructing or modifying projects or facilities that are anticipated to generate air emissions or increase current emission levels. Additionally, OG&E may need to obtain and comply with air permits outlining specific emission and operational requirements or implement emission control equipment. OG&E likely will be required to incur certain capital expenditures in the future for air pollution control equipment and technology in connection with obtaining and maintaining operating permits and approvals for air emissions.
40
Cross State Air Pollution Rule
In 2015, the EPA updated the ambient air standards for ozone. Although Oklahoma meets these standards, the Clean Air Act requires states to submit implementation plans to the EPA to ensure their emissions do not affect other states. Oklahoma submitted its SIP in 2018. However, in January 2023, the EPA disapproved the SIPs of 19 states, including Oklahoma. In response, the Oklahoma Attorney General, the ODEQ and OG&E filed petitions for review in March 2023. A stay on the EPA's disapproval was granted in July 2023. The timing of further action is currently unknown.
In a related matter, in April 2022, the EPA published a proposed FIP related to the "Good Neighbor" requirements intended to reduce interstate NOx emissions. OG&E commented on this proposed FIP in June 2022. By June 2023, the EPA finalized this plan for 23 states, including Oklahoma. This final Good Neighbor FIP would revise Oklahoma's NOx emissions budget for electric generating units, including OG&E's, starting in 2023. The emissions budget would decrease over time based on achievable reductions. OG&E estimated a 34.5 percent reduction by 2026 from 2023 levels and a 50 percent reduction by 2027 from 2021 levels. Following the FIP issuance, OG&E has been considering options to cut emissions at its generating units, including buying emission allowances, installing selective catalytic reduction systems, switching coal units to gas, or retiring and replacing capacity. OG&E submitted its final 2024 IRP to the OCC and APSC in March 2024, which evaluates various compliance options related to the EPA's Good Neighbor FIP. Due to the uncertainty surrounding the SIP disapproval and FIP implementation, OG&E cannot determine the exact cost of compliance. The costs depend on the litigation outcome, chosen control strategies, regulatory approvals, and project timelines. However, OG&E estimated in mid-2023 that compliance costs could range from $2.4 billion to $2.8 billion, including $100 million to $300 million over the first 12 to 18 months following the FIP's effectiveness. OG&E plans to seek recovery of necessary environmental expenditures but cannot guarantee approval or timely recovery of all such expenditures. In October 2023, several petitioners sought a stay of the final FIP from the U.S. Supreme Court, pending review of the challenges in the U.S. Court of Appeals for the District of Columbia. The U.S. Supreme Court granted the stay in June 2024. The EPA requested a delay in the case in February 2025, which was denied. In March 2025, the EPA sought to reconsider the rule without vacating it. The D.C. Circuit Court agreed to hold the case in abeyance in April 2025, requiring status reports every 90 days. The timing of further action is unknown.
The EPA has indicated that it intends to reconsider both the SIP disapprovals and the final FIP in a two-phase reconsideration rulemaking. In January 2026, the EPA proposed its "Phase 1" reconsideration of SIP disapprovals for several states. The EPA did not include the disapproved Oklahoma SIP in "Phase 1" but indicated that it intends to address the remaining states, including Oklahoma, in a separate action. The timing of further action is unknown.
Particulate Matter NAAQS
In February 2024, the EPA issued a final rule resulting from its reconsideration of the primary (health-based) and secondary (welfare-based) NAAQS for PM, which were set in 2013 and which the EPA declined to revise in 2020. The final rule lowers the primary annual PM2.5 NAAQS from 12.0 µg/m3 to 9.0 µg/m3 and retains the other PM standards at their current levels, including the 24-hour PM2.5 NAAQS. The Clean Air Act requires the EPA to determine which areas of the country meet the standards, such as making initial attainment and nonattainment designations, no later than two years after new standards are issued. States must develop and submit attainment plans no later than 18 months after the EPA finalizes nonattainment designations.
In June 2024, a coalition of 24 states, including Oklahoma, filed challenges to the final rule in the D.C. Circuit, and a separate coalition of states and other stakeholders filed to intervene in these challenges on behalf of the EPA. A coalition of 22 state governors separately requested the EPA to pause implementation of the final rule. In June 2026, the D.C. Circuit issued an opinion denying the challenges and upholding the primary annual PM2.5 NAAQS of 9.0 µg/m3 as revised in 2024. In July 2026, the U.S. District Court for the Northern District of California set a deadline requiring the EPA to promulgate final designations for all areas of the country no later than February 6, 2027.
The revised NAAQS could impact regional air quality goals and emission limits for emission sources, and it could affect pre-construction permitting for the siting of new emission sources; however, it is unknown at this time what, if any, potential material impacts to OG&E individual operating permit emission limits or the siting of new sources will result from the EPA actions.
41
Regional Haze
In July 2020, the ODEQ notified OG&E that the Horseshoe Lake generating units that were in-service at the time would be included in Oklahoma's second Regional Haze implementation period evaluation of visibility impairment impacts to the Wichita Mountains. OG&E submitted an analysis of all potential control measures for NOx on these units to the ODEQ. The ODEQ submitted a revised SIP to the EPA in August 2022. In February 2026, the EPA proposed to approve the Oklahoma SIP revision, and a 2024 consent decree requires the EPA to take final action no later than December 31, 2026. It is unknown at this time what the outcome, or any potential material impacts, if any, will be from the evaluations by OG&E, the ODEQ and the EPA.
Mercury and Air Toxics Standards
In April 2024, the EPA released the final revised Mercury and Air Toxics Standards regulation with a compliance date in July 2027. A coalition of states, including Oklahoma, challenged this rule in the D.C. Circuit Court and sought a stay, which was denied. This coalition of states then filed an emergency stay application with the U.S. Supreme Court, which was also denied. In April 2025, the EPA extended the compliance deadline to July 8, 2029. In June 2025, the EPA proposed to repeal the revised Mercury and Air Toxics Standards; the repeal was finalized in February 2026, removing the emission limit and monitoring requirements revised in 2024. In March 2026, the repeal was challenged in the D.C. Circuit Court. The potential material impacts, if any, of further actions by the EPA or final action by the D.C. Circuit Court are currently unknown.
Greenhouse Gas
OG&E monitors developments in federal greenhouse gas (“GHG”) emissions regulations applicable to fossil fuel-fired electric generating units. Changes in legal standards or the adoption of new regulations, could require significant capital investment and compliance expenditures. If such costs are not recoverable through regulated rates, OG&E’s financial position, results of operations, and cash flows could be materially affected.
In May 2024, the EPA issued final rules establishing (i) emission guidelines under Section 111(d) of the Clean Air Act for existing fossil fuel-fired steam generating units and (ii) revised standards of performance under Section 111(b) for new natural gas-fired combustion turbines. Significant litigation related to these 2024 GHG rules is ongoing. In February 2025, the D.C. Circuit placed the litigation in abeyance at the EPA’s request while the agency reconsiders the 2024 GHG rules.
In June 2025, the EPA proposed to repeal the 2024 GHG rules in their entirety and, alternatively, to repeal only specific aspects of the 2024 GHG rules. OG&E submitted comments on the 2025 proposed rules individually and through trade associations. On September 14, 2026, the EPA finalized a partial repeal of the 2024 regulation consistent with the 2025 alternate proposal, including elimination of all prior requirements for existing units and elimination of the requirement for new baseload combined cycle turbine units to capture CO2 emissions by January 1, 2032. The final rule made no changes to the sub-categorization and utilization restrictions for certain other types of new combustion turbines. The final regulation will be effective November 16, 2026 by which time challenges must be filed in the D.C. Circuit Court.
In a separate action published concurrently with the final partial repeal, the EPA issued a supplemental proposal related to fully repealing all greenhouse regulation for the power sector. The supplemental proposal solicits comments on additional reasons to rescind all GHG emission requirements for fossil fuel-fired electric generating units beyond those reasons on which the EPA solicited comments in the June 2025 notice of proposed rulemaking. Comments on the proposal are due November 2, 2026.
Separately, in February 2026, the EPA released a final rule that rescinds the agency’s 2009 Endangerment Finding, which determined that GHG emissions endanger public health and welfare. While rescinding the Endangerment Finding would not directly alter the 2024 GHG rules, it may result in increased regulatory uncertainty for the power sector as future generation needs are considered.
OG&E cannot predict the outcome of the EPA’s reconsideration process, rule changes, or pending and future litigation. OG&E continues to monitor these regulatory developments and evaluate potential impacts on its operations.
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Endangered Species
Certain federal laws, including the Bald and Golden Eagle Protection Act, the Migratory Bird Treaty Act and the Endangered Species Act, provide special protection to certain designated species. These laws and any state equivalents provide for significant civil and criminal penalties for unpermitted activities that result in harm to or death of certain protected animals and plants. If such species are in an area in which OG&E conducts operations, or if additional species in those areas become subject to protection, OG&E's operations and development projects, particularly transmission, wind or solar projects, could be restricted or delayed, or OG&E could be required to implement expensive mitigation measures.
In July 2026, the U.S. Fish and Wildlife Service published a final rule that removed the regulatory definition of "harm" from the Endangered Species Act, citing that harm is one of the prohibited actions within the definition of "take" which is an intentional act that will result in the killing of a protected animal. The U.S. Fish and Wildlife Service Director published a guidance document explaining that modification or destruction of habitat is not necessarily considered "take" unless the act was intentional in order to kill individual animals.
Waste
OG&E's operations generate wastes that are subject to the Federal Resource Conservation and Recovery Act of 1976 as well as comparable state laws which impose detailed requirements for the handling, storage, treatment and disposal of waste.
Ash from OG&E's River Valley, Muskogee and Sooner facilities is recovered and reused off-site in various ways, including soil stabilization, landfill cover, road base construction and cement and concrete production. Reusing fly ash reduces the need to manufacture cement resulting in reductions in greenhouse gas emissions from cement and concrete production.
OG&E has sought and will continue to seek pollution prevention opportunities and to evaluate the effectiveness of its waste reduction, reuse and recycling efforts. OG&E obtains refunds from the recycling of scrap metal, salvaged transformers and used transformer oil. Additional savings are expected to be gained through the reduction and/or avoidance of disposal costs and the reduction in material purchases due to the reuse of existing materials.
Water
OG&E's operations are subject to the Federal Clean Water Act and comparable state laws and regulations. These laws and regulations impose detailed requirements and strict controls regarding the discharge of pollutants into state and federal waters.
In 2015, the EPA issued a final rule addressing the effluent limitation guidelines for power plants under the Federal Clean Water Act. The final rule establishes technology- and performance-based standards that may apply to discharges of six waste streams including bottom ash transport water. In April 2024, the EPA released a supplemental effluent limitations guidelines rule. OG&E's installation of dry bottom ash handling technology at an affected facility complies with the 2024 rule requiring facilities to cease discharging bottom ash transport water. OG&E is evaluating compliance options at another affected facility, and in December 2025, the EPA published a final rule revising the deadline to cease bottom ash transport water discharge to December 31, 2034.
OG&E has made investments in its infrastructure at Redbud and McClain that have led to OG&E's use of treated municipal effluent for cooling water at each plant, which offsets the need for fresh water as cooling water, making fresh water available for other beneficial uses like drinking water, irrigation and recreation.
Site Remediation
The Comprehensive Environmental Response, Compensation and Liability Act of 1980 and comparable state laws impose liability, without regard to the legality of the original conduct, on certain classes of persons responsible for the release of hazardous substances into the environment. Because OG&E utilizes various products and generates wastes that are considered hazardous substances for purposes of the Comprehensive Environmental Response, Compensation and Liability Act of 1980, OG&E could be subject to liability for the costs of cleaning up and restoring sites where those substances have been released to the environment. No associated liability is expected to significantly impact OG&E at this time.
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Item 3. Quantitative and Qualitative Disclosures About Market Risk.
There have been no significant changes in the market risks affecting the Registrants from those discussed in the Registrants' 2025 Form 10-K.
Item 4. Controls and Procedures.
The Registrants maintain a set of disclosure controls and procedures designed to ensure that information required to be disclosed by the Registrants in reports that they file or submit under the Securities Exchange Act of 1934 is recorded, processed, summarized and reported within the time periods specified in the Securities and Exchange Commission rules and forms. In addition, the disclosure controls and procedures ensure that information required to be disclosed is accumulated and communicated to management, including the chief executive officer and chief financial officer, allowing timely decisions regarding required disclosure. As of the end of the period covered by this report, based on an evaluation carried out under the supervision and with the participation of the Registrants' management, including the chief executive officer and chief financial officer, of the effectiveness of the Registrants' disclosure controls and procedures (as such term is defined in Rules 13a-15(e) and 15(d)-15(e) under the Securities Exchange Act of 1934), the chief executive officer and chief financial officer have concluded that the Registrants' disclosure controls and procedures are effective.
No change in the Registrants' internal control over financial reporting has occurred during the most recently completed fiscal quarter that has materially affected, or is reasonably likely to materially affect, the Registrants' internal control over financial reporting (as such term is defined in Rules 13a-15(f) and 15d-15(f) under the Securities Exchange Act of 1934).
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PART II. OTHER INFORMATION
Item 1. Legal Proceedings.
Reference is made to Item 3 of Part I of the Registrants' 2025 Form 10-K for a description of certain legal proceedings presently pending. Except as described in Notes 12 and 13 within "Part I - Item 1. Financial Statements," there are no new significant cases to report against the Registrants, and there have been no material changes in the previously reported proceedings.
Item 1A. Risk Factors.
There have been no significant changes in the Registrants' risk factors from those discussed in the Registrants' 2025 Form 10-K, which are incorporated herein by reference.
Item 2. Unregistered Sales of Equity Securities and Use of Proceeds.
None.
Item 5. Other Information.
During the three months ended September 30, 2026, no director or officer of the Registrants
Item 6. Exhibits.
Exhibit No. |
Description |
OGE Energy |
OG&E |
31.01+ |
Certifications Pursuant to Rule 13a-14(a)/15d-14(a) As Adopted Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002. |
X |
|
31.02+ |
Certifications Pursuant to Rule 13a-14(a)/15d-14(a) As Adopted Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002. |
|
X |
32.01+ |
Certification Pursuant to 18 U.S.C. Section 1350 As Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002. |
X |
|
32.02+ |
Certification Pursuant to 18 U.S.C. Section 1350 As Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002. |
|
X |
99.01+ |
First Amendment to the Amended and Restated Credit Agreement dated as of September 9, 2026 by and among OGE Energy Corp., the Lenders and BOKF, NA, dba Bank of Oklahoma, as Sole Administrative Agent, Sole Syndication Agent, Lead Arranger and Sole Bookrunner. |
X |
|
101.INS |
Inline XBRL Instance Document - the instance document does not appear in the interactive data file because its XBRL tags are embedded within the Inline XBRL document. |
X |
X |
101.SCH |
Inline XBRL Taxonomy Extension Schema With Embedded Linkbase Documents. |
X |
X |
104 |
Cover Page Interactive Data File - the cover page XBRL tags are embedded within the Inline XBRL document (included in Exhibit 101). |
X |
X |
+ Represents exhibits included herewith. |
|||
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SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrants have duly caused this report to be signed on their behalf by the undersigned thereunto duly authorized.
|
OGE ENERGY CORP. |
|
OKLAHOMA GAS AND ELECTRIC COMPANY |
|
(Registrant) |
|
|
By: |
/s/ Sarah R. Stafford |
|
Sarah R. Stafford |
|
Controller and Chief Accounting Officer |
|
(On behalf of the Registrants and in her capacity as Chief Accounting Officer) |
October 27, 2026
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