Entergy Louisiana customers will see their bills rise slightly under new rates approved Wednesday, but the utility’s regulators were able to offset bigger rate hikes by settling long-running allegations that Entergy bilked ratepayers and mismanaged one of its massive nuclear plants.
The Louisiana Public Service Commission, which regulates Entergy Louisiana, had accused the utility of years of mismanagement and tax and accounting gimmicks at its Grand Gulf nuclear plant in Mississippi, at the expense of ratepayers.
The deal ends the long-running battle over Grand Gulf as well as a yearlong negotiation over Entergy’s proposal to raise rates.
Entergy had already settled the litigation with regulators in Arkansas, Mississippi and New Orleans, but the PSC had continued to try its case before federal regulators. New Orleans, which regulates Entergy New Orleans, approved a $250 million settlement this spring.
Now, Entergy owes $95 million as part of its deal with the PSC, about $20 million of which it has already paid. The money is being used to tamp down costs from Entergy’s rate hike, which was also approved Wednesday.
As a result of the dual settlements, customers will see bills rise by about 2% starting next month, and Entergy will eliminate reconnection fees for some customers, reduce late fees from 5% to 1.5% and make more low-income seniors eligible for discounts. The settlement also creates a working group to study energy affordability.
The 2% rate hike translates to about a $4 monthly increase to most bills, said Commissioner Davante Lewis, a Democrat who praised the deal as a win for customers. Entergy had sought to raise most customers’ bills by about $8 a month.
The Alliance for Affordable Energy, a consumer group, also hailed the deal. In particular, the group said the reduction of late fees will bring Louisiana in line with the rest of the country in an area where Entergy has long charged higher fees.
“I’m pleased to say that we support this late fee rate change, and are encouraged by (Entergy’s) willingness to reduce fees and identify neighborhoods where further support may be needed to help residents pay their electricity bill,” said Jessica Hendricks, state policy director for the group.
About a year ago, Entergy proposed raising rates on customers by about 5% to increase its profits and pay for various costs. The proposal came at a time as regulators vowed to subject the company to more scrutiny after Hurricane Ida, which knocked out power for weeks, exposed Entergy’s electric grid as frail and outdated.
Regulators have continued to debate whether to allow Entergy to charge customers another fee to pay for projects to upgrade the grid. Entergy Louisiana recently won approval for its plan to spend $2 billion to improve the grid. The New Orleans City Council has so far refused to approve a similar plan for Entergy New Orleans, though the utility is upgrading some sections of the grid using federal aid.