Entergy New Orleans reaches agreements in principle with City Council to benefit customers

News Release > Entergy New Orleans reaches agreements in principle with City Council to benefit customers

Entergy New Orleans reaches agreements in principle with City Council to benefit customers

04/18/2024

Agreements resolve multiple open issues including SERI, tax positions and reliability

NEW ORLEANS - Entergy New Orleans today announced three separate agreements in principle with the New Orleans City Council. The total value provided by the three settlements is $252 million. Though separate, each settlement provides significant and meaningful customer value - $116 million from the SERI settlement; $138 million from the tax matter; and $500,000 from the reliability matter. These agreements include the claims against System Energy Resources, Inc., the Entergy subsidiary that is the majority owner of the Grand Gulf Nuclear Station in Port Gibson, Miss.; the flow-through to customers of the benefits associated with a recent IRS tax settlement; and a long-standing dispute regarding past reliability performance.

"We are pleased to resolve these open issues after constructive conversations with the New Orleans City Council," said Deanna Rodriguez, president and chief executive officer for Entergy New Orleans. "We appreciate the collaborative effort of all stakeholders in getting to this point, and we look forward to the committee vote next week and to begin flowing the settlement benefits to our customers."

The settlement with SERI includes a global refund of $116 million as well as a reduction in the future costs charged by SERI to Entergy New Orleans for power from Grand Gulf. The settlement will end years of litigation across several issues.

"I am pleased that we are able to put the SERI litigation behind us," said Rod West, Entergy group utility president and president of System Energy Resources, Inc. "Some of these cases have been pending for close to a decade and resolving them lets us both provide meaningful refunds and lower rates to customers and stop the costly and time-consuming litigation at the Federal Energy Regulatory Commission," West added.

Entergy New Orleans has already received some of the $116 million settlement from SERI, and the remaining amount will be refunded once the Federal Energy Regulatory Commission approves the settlement. The lower rates provided for in the settlement will become effective as of June. This agreement is consistent with SERI's previous settlements with Entergy Mississippi and Entergy Arkansas, which were both approved by FERC and provided significant refunds to customers at a time when energy bills were high due to record usage.

The SERI settlement in principle with the council provides for how the $116 million refund will be credited to customers, with different amounts being credited over different periods of time.

The settlement associated with the IRS tax audit provides for a credit to customers of $138 million, to be paid over time. "We are especially pleased by this settlement because, thanks to the constructive engagement by the council, we were able to avoid litigation over these issues and instead quickly get benefits flowing to customers," said Rodriguez.

The reliability settlement resolves a long-standing legal dispute between the council and Entergy New Orleans regarding a fine issued by the council. This settlement requires Entergy New Orleans to invest, at its cost, $500,000 in upgrading reliability on its system.

"Entergy New Orleans has made significant improvements in its reliability performance over the past five years, and it made sense to put aside our legal differences over performance predating those improvements," Rodriquez noted.

Similar to the SERI agreement, the $138 million credit associated with the tax resolution and the $500,000 reliability credit will be used to help lower customer rates. The rate treatment provided by the council will allow customers in New Orleans to enjoy lower energy rates over 25 years.

About Entergy New Orleans

Entergy New Orleans, LLC provides electricity to approximately 208,000 customers and natural gas to approximately 109,000 customers in Orleans Parish, Louisiana. Entergy New Orleans is a subsidiary of Entergy Corporation, a Fortune 500 electric company. Entergy powers life for 3 million customers through our operating companies in Arkansas, Louisiana, Mississippi and Texas. We're investing in the reliability and resilience of the energy system while helping our region transition to cleaner, more efficient energy solutions. With roots in our communities for more than 100 years, Entergy is a nationally recognized leader in sustainability and corporate citizenship. Since 2018, we have delivered more than $100 million in economic benefits each year to local communities through philanthropy, volunteerism and advocacy. Entergy is headquartered in New Orleans, Louisiana, and has approximately 12,000 employees. For the latest news from Entergy New Orleans, visit the Newsroom and connect with @EntergyNOLA on social media.