OGE ENERGY CORP.

Previous wording

OGE Energy's net income was $50.2 million, or $0.24 per diluted share, during the three months ended March 31, 2026 as compared to $62.7 million, or $0.31 per diluted share, during the same period in 2025. The decrease in net income of $12.5 million, or $0.07 per diluted share, is further discussed below.

Current wording

OGE Energy's net income was $116.3 million, or $0.56 per diluted share, during the three months ended June 30, 2026 as compared to $107.5 million, or $0.53 per diluted share, during the same period in 2025. The increase in net income of $8.8 million, or $0.03 per diluted share, is further discussed below.

Previous wording

A decrease in net income at OG&E of $13.1 million, or $0.07 per diluted share of OGE Energy's common stock, was primarily due to lower operating revenues (excluding the impact of recoverable fuel, purchased power and direct transmission expense not impacting earnings) driven by milder weather and higher other operation and maintenance expense, partially offset by the deferral of certain interest expense to a regulatory asset in accordance with Oklahoma PISA.

Current wording

A decrease in net income at OG&E of $0.7 million, or $0.02 per diluted share of OGE Energy's common stock, was primarily due to an increase in other operation and maintenance expense, partially offset by the deferral of certain interest expense to a regulatory asset in accordance with Oklahoma PISA and higher operating revenues (excluding the impact of recoverable fuel, purchased power and direct transmission expense not impacting earnings) driven by the recovery of capital investments which offset the impact of milder first quarter weather.

Previous wording

OGE Energy’s consolidated earnings guidance remains unchanged from OGE Energy's original 2026 earnings guidance range of $494 million to $514 million, or $2.38 to $2.48 per average diluted share. OG&E is projected to earn approximately $533 million, or $2.57 per average diluted share. A loss of $30 million, or $0.14 per average diluted share is projected for other operations (primarily the holding company). 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.

Current wording

OGE Energy’s consolidated earnings guidance remains unchanged from OGE Energy's original 2026 earnings guidance range of $494 million to $514 million, or $2.38 to $2.48 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.

Previous wording

The following discussion and analysis presents factors that affected the Registrants' results of operations for the three months ended March 31, 2026 as compared to the same period in 2025 and the Registrants' financial position at March 31, 2026. Due to seasonal fluctuations and other factors, the Registrants' operating results for the three months ended March 31, 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.

Current wording

The following discussion and analysis presents factors that affected the Registrants' results of operations for the three and six months ended June 30, 2026 as compared to the same periods in 2025 and the Registrants' financial position at June 30, 2026. Due to seasonal fluctuations and other factors, the Registrants' operating results for the three and six months ended June 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.

Previous wording

OG&E's net income decreased $13.1 million, or 18.5 percent, during the three months ended March 31, 2026, as compared to the same period in 2025. The following section discusses the primary drivers for the decrease in net income during the three months ended March 31, 2026 as compared to the same period in 2025.

Current wording

OG&E's net income increased $12.4 million, or 11.5 percent, and decreased $0.7 million, or 0.4 percent, during the three and six months ended June 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 six months ended June 30, 2026 as compared to the same periods in 2025.

Previous wording

Operating revenues increased $4.9 million, or 0.7 percent, during the three months ended March 31, 2026, primarily driven by the below factors.

Current wording

Operating revenues decreased $29.7 million, or 4.0 percent, and $24.8 million, or 1.7 percent, during the three and six months ended June 30, 2026, respectively, primarily driven by the below factors.

Previous wording

These expenses are generally recoverable from customers through regulatory mechanisms and are offset in Fuel, Purchased Power and Direct Transmission Expense in the statements of income. The primary drivers of the changes in fuel, purchased power and direct transmission expense during the period are further detailed in the table below.

Current wording

These expenses are generally recoverable from customers through regulatory mechanisms and are offset in Fuel, Purchased Power and Direct Transmission Expense in the statements of income. The primary drivers of the changes in fuel, purchased power and direct transmission expense during the periods are further detailed in the table below.

Previous wording

Decreased primarily due to a 27 percent decrease in heating degree days.

Current wording

Increased during the three months ended June 30, 2026 primarily due to a 33 percent increase in cooling degree days and decreased during the six months ended June 30, 2026 primarily due to a 27 percent decrease in heating degree days.

Previous wording

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 $12.7 million, or 3.9 percent, during the three months ended March 31, 2026, primarily driven by the below factors.

Current wording

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 decreased $43.4 million, or 16.6 percent, and $30.7 million, or 5.2 percent, during the three and six months ended June 30, 2026, respectively, primarily driven by the below factors.

Previous wording

Increased primarily due to higher fuel costs related to the generating assets utilized during the period.

Current wording

Increased during the six months ended June 30, 2026 primarily due to higher fuel costs related to the generating assets utilized.

Previous wording

Decreased primarily due to lower market prices during the period.

Current wording

Decreased during the three and six months ended June 30, 2026 primarily due to lower market prices.

Previous wording

Other operation and maintenance expense increased $15.0 million, or 12.3 percent, during the three months ended March 31, 2026, primarily due to an increase in energy efficiency program activities and services, which are recoverable through riders, contract professional services, and uncollectible accounts, partially offset by lower contract technical and construction services driven by the timing of certain projects.

Current wording

Other operation and maintenance expense increased $12.3 million, or 9.7 percent, and $27.3 million, or 11.0 percent, during the three and six months ended June 30, 2026, respectively, primarily due to an increase in contract technical and construction services, driven by the timing of certain projects, vegetation management activities and payroll and benefits, net of capitalized labor, and with respect to the six months ended June 30, 2026, other operation and maintenance expense also increased due to energy efficiency program activities and services, which are recoverable through riders.

Previous wording

Depreciation and amortization expense decreased $1.0 million, or 0.7 percent, during the three months ended March 31, 2026, primarily due to deferrals of allowable depreciation and amortization expense of $11.2 million to a regulatory asset in accordance with Oklahoma PISA, partially offset by additional assets being placed into service.

Current wording

Depreciation and amortization expense decreased $2.5 million, or 1.8 percent, and $3.5 million, or 1.3 percent, during the three and six months ended June 30, 2026, respectively, primarily due to deferrals of allowable depreciation and amortization expense of $12.0 million and $23.3 million, respectively, to a regulatory asset in accordance with Oklahoma PISA, partially offset by additional assets being placed into service.

Previous wording

Net other income decreased $2.0 million, or 22.5 percent, during the three months ended March 31, 2026, primarily due to decreased interest income related to the carrying charge for the higher fuel under recovery balance in early 2025.

Current wording

Net other income increased $3.6 million, or 51.4 percent, and $1.6 million, or 10.1 percent, during the three and six months ended June 30, 2026, respectively, 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 higher fuel under recovery balance in 2025.

Previous wording

Interest expense decreased $6.8 million, or 12.0 percent, during the three months ended March 31, 2026, primarily due to the deferral of certain interest expense to a regulatory asset in accordance with Oklahoma PISA, partially offset by the $350.0 million in senior notes issuance in April 2025.

Current wording

Interest expense decreased $5.0 million, or 7.9 percent, and $11.8 million, or 9.8 percent, during the three and six months ended June 30, 2026, respectively, 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 issuance in April 2026 and, with respect to the six months ended June 30, 2026, also partially offset by interest expense related to the $350.0 million senior notes issuance in April 2025.

Previous wording

Changed primarily due to increases in cash received from customers, including cash related to fuel recoveries and customer connections.

Current wording

Changed primarily due to increased cash received from customers, including cash related to fuel recoveries and customer connections, and lower purchased power payments, partially offset by higher payments for fuel.

Previous wording

Changed primarily due to timing of power delivery projects and an increase in the cost of removals.

Current wording

Changed primarily due to timing of power delivery and power generation projects.

Previous wording

Changed primarily due to decreases in long-term revolver borrowings and short-term debt, partially offset by the repayment of the Muskogee industrial authority bonds that matured in January 2025.

Current wording

Changed primarily due to a decrease in short-term debt, partially offset by the repayment of the Muskogee industrial authority bonds that matured in January 2025.

Previous wording

Short-term Debt increased $200.4 million, or 68.6 percent, primarily due to increased borrowings for general operating needs. The Registrants borrow on a short-term basis, as necessary, through the issuance of commercial paper under their revolving credit agreements.

Current wording

Short-term Debt decreased $162.9 million, or 55.8 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.

Previous wording

Accounts Payable decreased $67.7 million, or 19.3 percent, primarily due to the timing of vendor payments and a decrease in fuel and integrated market payables.

Current wording

Accounts Payable decreased $68.4 million, or 19.5 percent, primarily due to the timing of vendor payments.

Previous wording

Accrued Compensation decreased $20.9 million, or 38.5 percent, primarily due to 2025 incentive compensation payouts that occurred during the first quarter of 2026.

Current wording

Accrued Compensation decreased $15.8 million, or 29.1 percent, primarily due to 2025 incentive compensation payouts that occurred during the first quarter of 2026.

Previous wording

Fuel Clause Over Recoveries increased $28.2 million, primarily due to higher recoveries from OG&E retail customers as compared to the actual cost of fuel and purchased power.

Current wording

Fuel Clause Over Recoveries increased $124.9 million, primarily due to higher recoveries from OG&E retail customers as compared to the actual cost of fuel and purchased power.

Previous wording

OGE Energy has unsecured five-year revolving credit facilities totaling $1.1 billion ($550.0 million for OGE Energy and $550.0 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 March 31, 2026.

Current wording

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 June 30, 2026.

Previous wording

The following table presents information about OGE Energy's total short-term debt activity for the three months ended March 31, 2026.

Current wording

The following table presents information about OGE Energy's total short-term debt activity for the three and six months ended June 30, 2026.

Previous wording

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.

Current wording

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.

Previous wording

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 PM 2.5 NAAQS from 12.0 µg/m 3 to 9.0 µg/m 3 and retains the other PM standards at their current levels, including the 24-hour PM 2.5 NAAQS. The EPA will 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.

Current wording

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 PM 2.5 NAAQS from 12.0 µg/m 3 to 9.0 µg/m 3 and retains the other PM standards at their current levels, including the 24-hour PM 2.5 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.

Previous wording

Litigation on the final rule is proceeding in the D.C. Circuit. A coalition of 24 states, including Oklahoma, filed challenges to the final rule, 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.

Current wording

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 PM 2.5 NAAQS of 9.0 µg/m 3 as revised in 2024.

Previous wording

The revised NAAQS could impact regional air quality goals and emission limits for emission sources; however, it is unknown at this time what, if any, potential material impacts to OG&E individual operating permit emission limits will result from the EPA actions.

Current wording

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.

Previous wording

In June 2025, the EPA proposed to repeal the 2024 GHG rules for both existing and new units or, alternatively, to repeal the 2024 GHG rules for existing units and rescind the carbon capture requirements applicable to new combustion turbines. OG&E submitted comments on the 2025 proposed rules individually and through trade associations. Although the EPA has initiated reconsideration and proposed repeal, the 2024 power sector GHG rules have not been stayed, and future compliance timelines remain in effect. If the new emission standards and guidelines are implemented, compliance costs could be significant. OG&E continues to monitor these developments and plan for compliance with 2024 GHG rules standards currently in effect.

Current wording

In June 2025, the EPA proposed to repeal the 2024 GHG rules for both existing and new units or, alternatively, to repeal the 2024 GHG rules for existing units and rescind the carbon capture requirements applicable to new combustion turbines. OG&E submitted comments on the 2025 proposed rules individually and through trade associations. The repeal rulemaking is in process, and the EPA's proposed final rule is undergoing review at the Office of Management and Budget after which the EPA will finalize and publish the rule in the Federal Register. Although the EPA has initiated reconsideration and proposed repeal, the 2024 power sector GHG rules have not been stayed, and future compliance timelines remain in effect. If the new emission standards and guidelines are implemented, compliance costs could be significant. OG&E continues to monitor these developments and plan for compliance with 2024 GHG rules standards currently in effect.