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Big Changes for The Big Easy?

image credit: ID 77049061 © Crackerclips | Dreamstime.com

After 35 years, New Orleans is changing the way it regulates utility company, Entergy.  The City Council has had regulatory authority over the electric and gas utility since the mid-1980’s but now flexes to implement change.  With Washington, D.C. being the only other city to regulate an investor-owned power company, New Orleans is the first to take the reins despite there being a state level agency in place.  Currently the council is working on a clean energy standard that could mandate 100 percent renewables by 2050, which may not be agreeable to the much more conservative Louisiana Public Service Commission. The council is also planning to change the way its consultants bill the city, requiring greater detail on project invoices.  Those are welcomed changes to customers concerned about estimated rate hikes.  Entergy told regulators it needs to spend an estimated $10 - $12 billion to replace units that are approaching 50 years old. As a regulated monopoly, Entergy’s customers will pay those costs.  Large industrial companies argue the projected costs are too high and want out before their rates rise as much as 50%.   The five-member Louisiana Public Service Commission unanimously directed its staff to look at all available options, including increased use of renewable energy sources and energy efficiency program expansion.  The commission will also consider letting large industrial customers shop for their own power on the “open market”.  Commissioner Craig Greene of Baton Rouge said, “It is a proactive approach to make sure we maintain the customers’ perspective as we look for solutions to those energy needs.”  To share in the clean energy goal, Entergy is working on several utility-scale renewable projects and purchases.  The utility also has a program in New Orleans to help put solar on commercial rooftops and company-owned solar panels on homes.  Entergy seems to be exploring a different business model, extending control of generation to homes and businesses while still investing in big, central station plants. However, innovation comes at a cost but not one customers want to see on their bill.

Will New Orleans’ City Council create regulations that slow progress or accelerate accountability? Is Entergy spreading themselves too thin or perfectly positioning themselves as the utility company of the future?

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