Council committee backs 4-year extension of Entergy's rate formula
The plan would run through 2030 annual filings, alongside a $29 million battery-storage program and $13 million in Francine storm costs.
NEW ORLEANS: The City Council's utility committee has recommended a four-year extension of the formula rate plan that governs Entergy New Orleans, a decision that would lock in the current ratemaking framework through annual filings to 2030.
The recommendation came as part of the committee's September review of the city's utility regulation docket. The extension would keep the formula mechanism, which adjusts rates annually within a set band rather than through full rate cases, in place for four more years.
The recommendations came from a joint session of the council's utility, governmental affairs, and budget committees and still face a full council vote. The committees also recommended directing Entergy to begin setting aside about $2.34 million a year toward potential future federal surcharges tied to a FERC proceeding, with unused amounts returned to customers, and certified about $13 million in Hurricane Francine storm costs for recovery from the storm reserve escrow. The Alliance for Affordable Energy says both items will ultimately come out of ratepayers' pockets.
The council is the regulator of Entergy New Orleans, a role no other Louisiana city holds, and its utility decisions land directly on household bills. The formula rate plan has been the central instrument of that regulation, trading the spectacle of litigated rate cases for annual adjustments its supporters call predictable and its critics call opaque.
The Alliance for Affordable Energy, the city's most persistent utility watchdog, greeted the committee's action with skepticism, arguing that an extension without stronger accountability measures locks in a framework that has not delivered the reliability or affordability residents need.
The same week, the council's Climate Committee voted to approve a $29 million battery storage program that advocates call the largest per-capita investment in battery storage anywhere in the country. The program, years in the making after Hurricane Ida, would put subsidized batteries in homes and at community institutions so the lights stay on when the grid fails. It is funded with Entergy settlement dollars, with costs recovered through existing Energy Smart mechanisms and no increase to customer rates, and at least 40 percent of residential funding is reserved for low-to-moderate income households.
The battery program's formal name is the Battery Energy Storage System Distributed Energy Resource Pilot Program, though its backers call it the Neighborhood Power Plan. The Climate Committee adopted a draft of its rules and incentives in late September, moving the initiative one step closer to installations in neighborhoods across the city.
The full council will take up the committee's recommendations in the coming weeks. For residents, the bottom line is measured in dollars per month, and in whether the lights stay on the next time a storm comes ashore.
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