Entergy customers to pay $3.2 billion for storm repairs over 15 years
2nd March 2022 · 0 Comments
By Wes Muller
Contributing Writer
(lailluminator.com) — Louisiana utility regulators voted Wednesday to allow Entergy to bill its customers $3.2 billion for repairs after five storms in 2020 and 2021. The Public Service Commission approved the storm tariff amid criticism that Entergy paid its shareholders $1.5 billion in dividends and its chief executive received a $4 million pay raise during that same period.
It will take approximately 15 years for Entergy’s customers to finish paying for the company’s infrastructure and assets that were damaged during hurricanes Laura, Delta, and Zeta in 2020, winter storm Uri in 2021 and some of the damages from Hurricane Ida in 2021.
Commissioners approved the monthly fee in a 4-1 vote, allowing the company to pass along the costs as a surcharge on the electricity bills of Entergy’s 1 million customers across the state. The company has given several different estimates of how much the monthly surcharge will be since submitting the proposal last year, citing a low of $5 and a high of $15. It could show up on bills as early as May.
Commissioner Foster Campbell, D-Shreveport, cast the lone vote in opposition to the proposal. He said he does not think it’s fair that customers in north Louisiana, who were not affected as much by the storms, have to pay an equal share of the costs while Entergy “won’t pay a single quarter.” Campbell said he is a “proud Democrat” and is worried about the pocketbooks of poor people. He criticized Entergy CEO Leo Denault for taking a 40 percent pay raise and approving shareholders dividends.
“Mr. Denault, how are you going to explain to the people of north Louisiana that your salary went from $10 million to $14 million during these troubling times?” Campbell asked. “How do you explain, Mr. Denault, that you gave out $1.5 billion worth of dividends during these troubling times? …I’m just troubled by your company’s arrogance — absolute arrogance.”
According to the Economic Research Institute, Denault actually earned over $16 million in total compensation in 2020, up from about $9 million in 2018. Entergy recently applied for a $450 million federal grant to make its power grid more resilient. Campbell added this point to his critique and said the company should dip into its own pockets to cover some of the storm damage.
Because of its size, the utility company is self-insured and must pay the costs of storm damages, which it plans to cover with a loan backed by customer billings.
In response to Campbell, Entergy executives said stopping the payment of dividends would be akin to a homeowner stopping payment on a credit card just before getting a home repair loan.
Commissioner Eric Skrmetta, R-Metairie, called Entergy’s handling of storm recovery “impressive” and said he supports billing customers because the alternative could make Louisiana less attractive to corporate investment.
When a storm hits, the government always tells Entergy to spend whatever it needs to get power back on as soon as possible, and shareholders “bring in money” to make a secure and stable electrical system for the state, Skrmetta said.
“We’ve got a duty and an obligation to make investment come to Louisiana,” Skrmetta said.
Campbell directed PSC staff to look into alternative options for future disasters that spread the costs of recovery more fairly between customers and utility companies.
“There’s no rule that says these companies can’t help,” Campbell said. “They can put up some money too.”
This article originally published in the February 28, 2022 print edition of The Louisiana Weekly newspaper.
