Sunday, September 24, 2006

Entergy Reporting

I can't be the only person who's left with more questions than answers every time he reads an article or hears a report about Entergy's rate increase request. The article mentioned in the previous post didn't exactly say that Entergy N.O. has been overbilling its customers; it merely left that impression. What was left out of that last report was that Entergy New Orleans actually claims $398M in damages. If the city council's consultants say that $88M of that shouldn't be counted, that might explain allowing an 18% increase rather than a 22% increase. It might, but it seems odd that the city council's paid consultants would make that recommendation before finding out how much CDBG money Entergy ends up getting. It also wouldn't explain how the consultants went from a 44% decrease to an 18% increase or why Entergy's aid request has gone from $718M to $592M. Of course, if you get your news from Fox8, "Entergy N.O. needs almost $600M"
to remain solvent.

As I see it, none of the local reporting makes the distinction between Entergy's requests to cover actual damage and its requests to cover lost revenue or build up a huge interest earning cash reserve that would increase the value of its stock ( Entergy calls it an emergency fund) clear enough. We're also not given very much explanation when Entergy changes its aid request or damage claims, although we wouldn't expect those figures to remain constant, some explanation would be nice. In the Spring, there was talk of a $500M bond sale to repair Entergy damaged facilities, that seems to have been forgotten. It may have been reported on, but I missed it. Knowing who killed the deal would certainly affect my opinion. Most importantly, the media is ignoring the fact that the city council vote on a rate increase is scheduled for Oct. 31 even though Gov. Blanco hopes that a decision on state aid will be made sometime in October. Assuming the state makes its decision on schedule, the council still won't have much time to make an informed decision on Entergy's request. It would be nice if the Paper gave us a detailed account between now and then; of course, it wouldn't look as sexy on the cover of a Sunday paper as pictures of judges on beaches.

Right on, man. Someone should be asking these questions. Unfortunately it's the readers who have to ask them of the T-P and not the T-P asking them of Entergy and the city's consultants
No one has pointed out that the only reason Entergy New Orleans exists is so the City, not the Public Service Commission can regulate them. This is and always has been a bad idea.

If Entergy New Orleans had been merged to Entergy Louisiana, as it should have, we wouldn't be in this situation.
That's not totally true, mominem. You're right about how we got into this mess, but it has been reported. The T/P had one long story on the subject a couple of months that made it prety clear. That article was a good start and I don't the follow-up has been bad, other than that one article. I do think that we should get a thorough follow-up before the issue comes up for a vote, with a better break down of the basis for Entergy's damage claims and aid/rate requests. I'd also like for more than one news source to look into the city's consultants and their fees.

The fact that a former city council made a mistake does limit this council's options, but it doesn't mean that it has to roll over.
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