It could have been worse but we still will pay more.
Entergy Louisiana will soon charge ratepayers an extra $5.50 per month to pay for restoration costs from Hurricane Ida and other storms, the Public Service Commission has decided after a dispute over whether the utility should shoulder some of those costs. A majority of the commission last month refused to approve Entergy’s request to charge $1.6 billion in storm restoration costs, money that has historically been bonded out and added to customers’ bills. Members said they didn’t believe Entergy was doing enough to maintain the grid, and therefore should be covering some of those costs. But at its meeting this week, the PSC voted 3-2 to approve the charges, which will likely start appearing on bills in April, after devising a complex mechanism to reduce the amount by $180 million. That brought the total amount to just under $1.5 billion.nola.com
It takes all of a tax benefit we would have received.
The deal involves Entergy taking a tax benefit that customers would have otherwise received over 23 years and using it all at once to reduce the storm cost bill by $180 million. Proponents, including Commissioner Craig Greene, argued the move would force Entergy to take on some risk. “It’s getting Entergy to get a little dirt on their jersey,” Greene said. Spokesperson Brandon Scardigli said in a statement that the $5.50 charge for a household using 1,000 kilowatt hours of energy a month could move up or down depending on interest rates. Entergy Louisiana provides electricity to 1.1 million customers in 58 parishes, and natural gas services to 96,000 customers in Baton Rouge. It is regulated by the Public Service Commission; a separate Entergy New Orleans branch is regulated by the New Orleans City Council. Entergy Louisiana’s latest charge comes on top of an additional $10 a month the commission approved earlier this year, as a way to let Entergy recoup $3.2 billion in costs for several recent storms. Both charges will stay on customer bills for 15 years.
We are still paying for Isaac so it shows how long these recovery costs last.
The commission first allowed the utility to bond out the costs of storm repairs and have customers repay them over time – a process called securitization – after Hurricane Katrina, as a way to lower monthly bill amounts. For instance, customers are still paying for costs associated with Hurricane Isaac, which made landfall in 2012. The deal comes as the commission is taking a harder look at how Entergy prepares for – and pays for – natural disasters, which have wreaked havoc on the electric grid in recent years. At Greene’s direction, the PSC has begun to probe Entergy’s infrastructure and how it’s maintained. Greene, and Commissioners Eric Skrmetta of Metairie and Mike Francis of Crowley voted for the deal. All three are Republicans. Skrmetta said that the delay–the item initially came up in December–cost ratepayers about $50 million because of increased interest rates, which he said dulled the $180 million benefit. The commission’s two Democrats, Foster Campbell and Davante Lewis, voted against the deal. Lewis, a newcomer, beat fellow Democrat Lambert Boissiere in a heated campaign last fall, largely on a platform of holding Entergy and other utilities accountable. Campbell and Lewis said the deal didn’t go far enough in making Entergy shoulder some of the costs. Campbell also said his constituents in north Louisiana are paying too much for restoration from hurricanes that don’t affect them. “I think there’s more savings” to be had, Campbell said.
Companies should be responsible for their infrastructure and not always go to the customers to be bailed out.