The term “rate case” sounds so tame. In Algiers, the better term would be “rate war” because it was bloody. We have never seen anything so brutal. Entergy Louisiana (ELL) tried to strike the testimony of AARP’s expert for not being qualified; she has over 20 years of experience testifying before public service commissions across the country. ELL got a bitter taste of New Orleans regulation, which is much less friendly than what you might expect from such a polite city.
But, ELL had an air-tight case for the rate increase and for stopping their LPSC customers from subsidizing their Algiers customers. Entergy Louisiana customers have been paying for Hurricane Katrina and Ike for 9 years and 6 years respectively. Entergy New Orleans customers have been paying for the Storm Reserve Fund for years. Algiers customers have not paid anything on their electric bill for storm costs. The reason is Algiers has not had a rate case in 10 years which is Entergy’s fault but still. Algiers has not had an increase since 1986, 28 years!
Of course, none of these facts went over well with the community. Frankly, it is completely understandable because 30% of them are on fixed incomes. So, even though the average bill should only increase by about 65 cents per month each year over the next 4 years, people already cannot afford their bill. Algiers customers are making hard choices between food, medicine, and AC. All are critical for our elderly population and we will need to make up the difference for them through energy efficiency programs and other mechanisms like Arrearage Management Plans.
But these interventions will not solve the problem for everyone. A new issue about the fuel adjustment charge was brought to our attention by a studious ratepayer from Algiers. She had 3 bills from March 2014, one from the Eastbank, one from ELL Algiers, and one from ELL, that showed that all three bills were the same cost per kWh if you included the fuel adjustment charge. So, it appears that Algiers customers had lower rates but higher fuel costs. Further research revealed that there are differences in the fuel adjustment charges for each of the Entergy companies and this concerns us.
Moreover, the fuel costs have gone up for all ELL customers. When we joined MISO our rates increased but our fuel costs were supposed to decrease and more than make up for the rate impact. The opposite has happened with ELL. Since January, ELL Algiers fuel costs have doubled. The Alliance has already asked for an explanation about this and we will keep you posted on what we find out.
-Excerpt from Energy Matters Newsletter 7/24/2014