OGE Energy Corporation is an electric and natural gas utility in the south central United States. The company's revenue is evenly divided between electricity and natural gas sales, but the company's electric utilities segment has always been more profitable. Growing popular support for renewable energy standards and emissions caps has led to legislation in many states, and if a national standard were adopted (likely, given the current Presidential candidates), OGE will have to break its dependence on coal and natural gas by spending large amounts of money on growing renewables' share of its portfolio; already, OGE expects its expenditures due to environmental compliance in 2008 to be equivalent to approximately 20% of their total CapEx. By 2009, the company expects this spending to nearly triple.

Furthermore, state regulation of electric utilities rates means that, while the company is guaranteed a profit, OG&E's margins are limited by the prices and returns allowed by the state. The company does not have a strong history of getting rate increases, meaning that when input costs rise, it's less likely that the company will be able to pass them on to customers. For example, in both 2005 and 2006, the rate increases granted to OG&E by state commissions were less than half the amount they requested. Both of these requested increases would have kept OG&E's rates below regional and national averages, but the commissions remained skeptical. OGE's best growth opportunities, therefore, are in its natural gas segments where, thanks to high petroleum prices, margins are large and demand is predicted to grow. As a utilities company, OGE has no competitors in its operating region thanks to government regulation and the high cost of infrastructure installation; in the natural gas processing industry, the company competes with Devon Energy, Spectra Energy, and Williams Companies.

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