The Commission approved requests related to data center development and gas plants, heard the outcome of Entergy’s Low Income Affordability working group, and gave one gas company permission to expedite their financing approval processes. In a win for residents, the Commission rejected SLECA’s proposal to abandon electric service to hundreds of families who have been without power since Hurricane Ida damaged a local transmission line in 2021. Additionally, the Commission paved the way for AAE’s settlement agreement with Entergy to allow our staff to view material designated as “Attorneys’ Eyes Only” in our case related to the Meta data center.
Yesterday, the PSC brought relief to hundreds of Louisiana residents who have been without power for five years. Fearing that electricity would never be restored after Hurricane Ida damaged critical infrastructure, the Commission put their concerns to rest by rejecting their utility’s request that they be allowed to permanently abandon service. Now, SLECA must propose a plan for restoring power to residents.
Since Hurricane Ida hit Louisiana in 2021, nearly 300 residents in South LA have been without power. Following the storm, three segments of a damaged distribution line called the “Lake Line” were never repaired, leaving residents in Lake Fields Island, Lake DeCade, and Grand Pass without electric service.
Their cooperative utility, the South Louisiana Electric Cooperative Association (SLECA), claimed that rebuilding the line would cost $140M. On top of that, environmental permitting, mitigation, and right of way procurement could add anywhere from $11.5M to $23M to SLECA’s bill. In April, the utility – for the first time anywhere in the country – asked the PSC for permission to end service to these residents, arguing the repairs were too expensive to complete.
Despite 90% of restoration costs being covered by FEMA, SLECA claimed restoring service would cost all other customers, including nonimpacted SLECA ratepayers, $13-24 per month for the next 30 years. While those costs are high, they’re also not guaranteed to come to fruition. The costs to the 282 families who have been forced to purchase costly generators are burdensome, too.
SLECA assured residents for years that they would restore power, sending them letters in 2021, 2022, and 2023 promising that restoration was on its way. Yet residents claim SLECA removed infrastructure even before a ruling came from the PSC and never told them they were pursuing disconnection. Now, their property values have been significantly affected by the prospect of permanent abandonment.
Following the Commission’s decision, SLECA must now devise a plan for restoring power to residents. One option is to install solar and backup batteries to properties, an alternative that likely costs far less than rebuilding the original infrastructure.
SLECA, or the South Louisiana Electric Cooperative Association, is a co-operative utility that serves Lafourche, Terrebonne, Assumption, St. Martin, and St. Mary Parishes. It is run by a 9-member board of directors headquartered in Houma. SLECA serves 21,367 meters, and 17,000 customers/members. They service 1,500 miles of power lines.
Sarah Boudreaux, a resident of Lake Fields, told the Commission, “This decision matters beyond Lake Fields. A utility cannot make the decision first, conduct the required analysis later, make limited attempts to exhaust reasonable alternatives, and then use the absence of their restoration plan as the reason abandonment would be granted.”
In the meantime, AAE applauds the Commission for standing with residents, and rejecting the notion that power is not a fundamental right. The Alliance believes more affordable alternatives are available, and will advocate that SLECA explore renewable options like solar and battery storage before pursuing restoration of the Lake Line.
Members of the Low Income Affordability Working Group shared the outcome of their work to find potential solutions to help low income families with utility debt.
As part of a settlement that emerged from Entergy’s last attempt to increase rates, the utility agreed to participate in a working group to identify solutions for low income households who are delinquent in their payments.
While several programs already exist to help families lower their bills, the Working Group proposed two additional programs: a Time of Use Rate and the Debt Forgiveness Pilot Program.
The Time of Use Rate is an optional program that incentivizes households to use less power during the peak hours of 3-7pm from June-September. The program is estimated to reduce the demand during peak hours ~18MW by the fifth year of the program and ~50MW by the tenth year. An estimated 17% of residential households, and a larger share of those particularly vulnerable, would see lower bills without changing their behavior. Entergy is expected to bring the full Time of Use Rate proposal to the Commission this year for implementation next year.
The Debt Forgiveness Pilot Program would serve as a testbed for a large debt forgiveness program. Under the pilot, Entergy would forgive $1,500 worth of debt for 150 low-income, elderly, and disabled residents. In order to qualify, households would need to pay their bill on time each month. For each month they do so, Entergy would forgive 1/12th of past-due balances. However, failure to pay on time would result in removal from the program.
The money for this program comes from Entergy’s existing Power to Care program, which provides emergency bill payment assistance to seniors and disabled individuals. The money for that program comes from donations from the public and Entergy staff, and is matched by Entergy shareholders. That leaves $225k – the cost of the pilot – less for the Power to Care program. That’s why we believe the program is a good start, but limited in its scale and impact at only 150 customers. During yesterday’s hearing, Entergy said they were finalizing another program using Power to Care funds to provide one-time bill relief for residents. However, no details were shared at this time.
Entergy is expected to finalize the proposal by the first half of 2027. The program would be regulated and run by Entergy itself, while the Commission has committed to asking Entergy to supply reporting on it so there is some oversight.
While these policies are not enough to address the scale of the affordability crisis, The Alliance feels they are a good start to addressing the hardships faced by families struggling to afford high energy costs. The meetings were productive, and AAE appreciates everyone who gave time to help make things easier for Louisiana’s most vulnerable households. The Alliance will continue to fight for solutions that lower costs, decrease disconnections and outages, and increase reliability.
Commissioners voted to proceed with Staff’s recommendations to approve Delta Gas’s proposal to expedite their financing approval process.
In May, Delta Gas companies requested the PSC issue an order approving a blanket financing authorization for the issuance of long-term secured and unsecured debt. This would give Delta financing flexibility in an unpredictable market by allowing them to to take on millions of dollars in new debt, grant them quicker access to capital, and obtain better borrowing rates. Delta North would be allowed to incur long-term (debts borrowed under terms of longer than a year) debt up to $200 million. Delta South would be able to incur up to $195 million. Delta Capital would be able to incur up to $70 million. The agreement would last until December 31, 2030.
Under the current procedures, the Commission requires separate filings for financing in dockets with noticed applications and potential hearings prior to approval. This request eliminates the need for PSC Staff to conduct an advanced review and authorization of any short term debt, while still ensuring Staff and Commissioner’s review and the opportunity to reject long-term debt proposals under an expedited review process.
Delta serves more than 330,000 gas customers and operates approximately 9,658 miles of gas lines throughout the state.
The Commission approved a request from SWEPCO to convert three coal plants to natural gas and by building four new natural gas plants in Texas. The Alliance is disappointed to see the Commission approve any new natural gas plants. While these were the lowest cost (cheapest) option available in terms of construction and operations, those costs fail to factor in social and environmental costs, which are significant and will disproportionately burden low-income communities.
While operating through existing transmission connections lowers the price, as does converting existing power plant infrastructure, these plants nevertheless add natural gas to an already gas-heavy regional power system and potentially an additional $7 to residents’ bills. Because these are single turbines, rather than combined-cycle turbines, SWEPCO is also choosing the more polluting and wasteful option between the two types of gas plants. In combined-cycle turbines, heat that is created by burning gas is captured to spin a secondary turbine, increasing the total amount of electricity generated.
During yesterday’s hearing, Commissioner Lewis asked SWEPCO whether they considered combined-cycle turbines. A representative said they had, but that the additional energy was not needed.
The Hallsville Natural Gas Plant would replace the retired H.W. Pirkey Power Plant, a former coal plant, with the construction of two combustion gas turbines that combined would add 450 MW of capacity to SWEPCO’s portfolio. At the currently operational Welsh Power Plant – a coal plant located northwest of Cason, Texas – coal-fired boilers in Units 1 and 3 would be converted to gas turbines. These turbines would have a 30-year life span and work off of existing connections to SPP’s power system. Consultants studied SWEPCO’s proposal to determine whether the construction of these plants was being driven by data centers, and found that isn’t the case.
Oil and Gas Watch says the Hallsville plant alone will add 7,000 tons of air pollutants annually. More gas on the grid is never a good thing, and The Alliance will advocate for more renewable options in future capacity additions.
The Alliance and Entergy reached an agreement for members of the Alliance team to access and review information Entergy previously designated as “Attorneys Eyes Only.” This agreement will allow members of the Alliance to read the full testimony of our experts in the case, discuss strategy with our Earthjustice attorneys, and engage fully in the proceeding, which we weren’t previously able to do. That has made it difficult to make decisions about how to move forward and where and when to push back on Entergy’s actions.
Importantly, this agreement does not give members of the Alliance access to the information about jobs and power needs that we sought at the Commission in August.
The Commission accepted the agreement without a vote.
Meta and Entergy are seeking approval from the PSC (docket U-37882) to build billions of dollars worth of fossil fuel infrastructure to power Meta’s AI Data Center currently under construction in Richland Parish.
The PSC already granted Entergy Louisiana approval last year to build three new gas plants to power the data center. But Meta now plans to double the size of its AI data center, pushing energy demand to more than twice the level previously disclosed, all while receiving $3.3 billion in tax breaks.
Entergy is now seeking to fast-track PSC approval for seven more gas plants for the data center. We expect the PSC to vote on this application in December.
Together, AAE and UCS are challenging Entergy’s proposal before the PSC to fast-track approval of seven new gas power plants for Meta’s Hyperion data center. In these proceedings, Entergy arbitrarily designated some information related to the case as “Attorneys Eyes Only.” While it’s normal to have some material protected in a case like this, Entergy created an entirely new category of material, and arbitrarily determined who could and couldn’t see it. The majority of the people who couldn’t are Alliance and UCS staff.
Earlier this year, we asked the ALJ to intervene, and she agreed that Entergy couldn’t keep us from seeing the information. Before the PSC could weigh in, AAE and UCS came to a settlement agreement with Entergy on the issue.
Under the terms of the settlement, we can access and discuss testimony from our own experts. However, any other designated “Attorneys Eyes Only” material, including Entergy’s full application, PSC Staff testimony, and discovery, is not so readily available. In order to view the material, The Alliance must request a visit to Entergy’s reading room seventy-two hours in advance, where the material can be viewed under Entergy’s supervision. We may not take notes, nor may we take any material home.
The Alliance appreciates the PSC’s making this settlement possible so that we may finally see all of our experts’ testimony and discuss the full case with our attorneys, though we wish the terms of the settlement were less restrictive. This agreement is a consolation and hardly the outcome we prefer. The Alliance will continue to advocate for transparency and believes all participants should have full access to information about the proceeding.
In accordance with Governor Landry’s Lightning Initiative, the Commission voted to approve Cleco’s request for the PSC to direct relevant parties to adopt an expedited procedural schedule for a 430 MW hyperscale data center. Cleco had sought to speed up the approval process for the transmission and generation projects associated with the new hyperscale data center in Rapides Parish.
Cleco has asked that the review, approval, and certification processes related to the data center be completed within eight months, with a final vote on their proposals by March. This expedited schedule is only possible because of the Governor’s Lightning Speed Initiative, which the PSC operationalized through the Lightning Directive. The Directive removes regulatory guardrails by waiving the “market based mechanism” policy the Commission designed to ensure utilities source the most affordable energy available. Allowing utilities to bypass this process means we won’t know if their choice is the best option.
The directive also dramatically speeds up the approval process for the investments, moving from a typical 10-12 month decision-making timeline to not more than seven months, which will hobble efforts to protect residents against bad deals. The approval process takes time because it includes expert witnesses, analysis, discovery, testimony, and an independent judge’s recommendation. Cleco has asked the Commission specifically to exempt them from a formal RFP process and certain transmission siting processes.
The Alliance believes in the safeguards built into the Commission’s existing processes, which is why we have pushed back on the Lightning Directive time and time again. By speeding up approvals for this data center’s electrical infrastructure, we can’t be sure that Cleco is doing everything it can to keep costs down for Louisianans. We know Cleco will seek to maximize their own profits, and these processes help ensure their efforts don’t come at the expense of everyday residents. The Alliance hopes a procedural schedule will be set that is not so rushed, so that all parties may conduct their due diligence.
