Entergy Antidote?

September 14th, 2006

It’s nice to see that someone professional is taking legal issue with Entergy Corp’s stance that they’re not responsible for any of Entergy New Orleans’ (and its ratepayers’) troubles right now. According to Jim Chen at the Jurisdynamics blog,

Much of the problem arises from Entergy’s understanding of public utility law, one evidently shared by regulators with the authority to carry out this travesty.

Chen holds that Federal Power Commission v. Hope Natural Gas Co, the 1944 Supreme Court case frequently cited as Entergy’s excuse for leaving its subsidiary in the lurch,

emphatically did not dictate that regulators must always permit a utility to earn a rate of return on all of the investments it has historically sunk…Hope and the broader law of economic regulation do entitle Entergy to stay solvent under regulatory ovesight, but no single methodology is binding on ratemakers, let alone one that so odiously transfers wealth in a way as to make Entergy an effective profiteer from the misery wreaked by Hurricane Katrina.

Odious indeed. Ultimately, I’ll have to agree with almost any compromise that prevents a 140% rate increase for us all, including a Community Development Block Grant bailout if that’s all we can do, but I hate to see Entergy’s attitude rewarded without any objection (besides of course the business of human decency, which sadly doesn’t hold much policy weight).

On another note, one of Jurisdynamics’ areas of focus is legal response to natural disasters, so there are some other interesting posts there regarding Katrina-related issues, and it’s worth watching for more.

14 Responses to “Entergy Antidote?”

  1. Schroeder Says:

    How ever did you find this?!!

    No, you don’t have to answer — I’m just ecstatic that you did.

    If only views like Chen’s weren’t so scarce! If only we had some elected officials who used their mojo, or whatever else they can muster, to so courageously make the case.

  2. becky Says:

    If I remember correctly, I was trying to figure out just what this mysterious “landmark 1944 case” really was, and hit pay dirt. I don’t speak legalese very well, but I thought if it really was a landmark case, there might be some analysis out there.

    I’m really intrigued by the jurisdynamics blog in general. Between taking Katrina and its aftermath very much to heart, writing for lay readers, focusing on law’s capacity to evolve, and incorporating math, science and linguistics into legal thought, this is one to watch.

    Now if we could scare up some mojo…

  3. Karen Wimpelberg Says:

    I wish to thank Ms. Houtman for her clear incense over the actions/non-actions of Entergy Corp. with regard to the devastation of its smallest subsidiary, Entergy New Orleans (ENO). The Alliance for Affordable Energy is a local non-profit founded in 1985. We have been intervenors in rate cases for all of our nearly 21 years. We consider ourselves to be ‘professional’, clearly Ms. Houtman has not made herself aware of our work, which may be understandable since our work over the years has been regarded by the press mostly as ‘green’ work, and not as a watchdog group – despite our efforts to point out that we are a consumer advocate group with a mission to promote fair, affordable and envionmentally-responsible energy policy for New Orleans, Louisiana and the nation. She, Mr. Schroeder and Mr.Chen might be very interested in the recommendations that I, as President of the Board of the Alliance, and our staff made just yesterday (9/14/06) to the N.O. City Council Utility Committee. The article in the MONEY section of the Times-Picayune this morning rightfully concentrated on the major part of our presentation, Energy Efficiency & Sustainable Energy Policy for N.O. which presented various possibilities to help ratepayers reduce their bills. We did, however, also address the obsticals & difficulties of instituting any real systemic solutions to proposed rate increases due to the relationship of ENO to its holding company. We would be glad to supply them to whomever is interested – at their request. We are intervenors in the past and current extensions of the rate cases before the City Council (as regulators of Entergy N.O.).
    I also gave testimony, both written and public on Aug. 28, at one of the only public hearings the NRC (Nuclear Regulatory Commission) and its Tribunal has held on the issue of whether Entergy Corp. should be granted a permit to build up to two more nuclear power plants at the Grand Gulf Nuclear Power Station in Port Gibson, MS. I had to drive four hours to attend this hearing. They now hold hearings on nuclear power plant issues only at the sites of the power plants or in Washington, DC. – making it quite difficult to get real public input. The Alliance intervened in all Grand Gulf related issues until this last one. The rules have been changed in order to ‘stream line’ the public hearing process – so intervention now is quite difficult and costly. This entire process and how it is being handled is a terrible strike against open meetings and democratic processes, not mention an economic and environmental distaster for the ratepayers of the Entergy System and the nations’ taxpayers. Thank you for your keen interest in all of this. The Alliance has been needing the public to get irrate around some of these issues. We lost some of our staff, our office and much of our archives to Katrina and Rita, so are working to get our website more current – please be patient. Karen Wimpelberg

  4. Karen Wimpelberg Says:

    I take it there is a limit on number of words for comments?

  5. becky Says:

    Hi Karen,
    Thank you very much for your response. Sorry it’s taken me a little bit to catch up with your comment; I’m at work, taking a late break for lunch right now.

    I think I worded things a little poorly – I didn’t mean to suggest that there are no professionals addressing the Entergy mess – just that as a lay person I’m always pleased to see someone with a legal understanding I don’t have taking an interest in our situation and adding to the public dialog.

    As I’ve been attempting to get a (slightly) better grasp on what’s been going on with Entergy, I have seen the Alliance come up, and I fully intend to read more about your work. It’s all the more important since so many of us have so little time and expertise to follow these issues at the length they deserve, when they’ll affect us all so much.

    Thank you for everything you’re doing, in and out of the public eye.


  6. Karen Wimpelberg Says:

    Thanks Becky,
    I realized I did not leave you the Alliance for Affordable Energy’s website address – and as I said, we are desparately needing a remake, update to add more about the regulatory side of what we do. But here it is: http://www.all4energy.org Karen Wimpelberg

  7. Jim Chen Says:

    Greetings Becky Houtman and readers,

    Thanks for the high praise. Yours is an audience I had hoped to reach through Jurisdynamics.

    I thought I’d leave two items here for your review:

    1. The academic paper from which I extracted my attack on Entergy’s position is “The Death of the Regulatory Compact.” It can be downloaded free of charge at http://papers.ssrn.com/abstract=771205. I hope you pass the link around, especially to people who might take legal recourse against this regulatory travesty.

    2. Dan Farber and I are very pleased to announce the arrival of our book, “Disasters and the Law: Katrina and Beyond.” I posted a brief item about the book at Jurisdynamics: http://jurisdynamics.blogspot.com/2006/09/disasters-and-law-katrina-and-beyond.html.

    I will be linking BeckyHoutman.com in the Jurisdynamics sidebar. I welcome you to Jurisdynamics and its entire network of affiliated weblogs, http://www.jurisdynamics.net.

    Best regards,
    Jim Chen

  8. becky Says:

    Thanks again, Karen – I’ve been checking out some of the links on your site, and just finished reading the Times Picayune Money section article you mentioned above. I’m especially interested in the net metering concept.

  9. becky Says:

    Thank you Jim,
    These are more great resources, and I’m looking forward to checking them out more thoroughly. So much of what we’re facing here in New Orleans now are issues that really affect the entire country; they’re just brought into extremely high relief by our case. It’s encouraging to see attention from different fields both for the sake of our own crises here, and for the potential to review and improve policy everywhere.

  10. NorthWest Carrollton » 2 Interesting Blogs Says:

    [...] Also Becky Houtman has written a post about Entergy. If Entergy has their way we will be sitting in the dark soon.No Tags [...]

  11. mominem Says:

    Please keep in mind that we are in this mess because the City Government would not allow Entergy to consolidate New Orleans with the rest of Louisiana. If that consolidation had happened we would not be in this fix.

  12. becky Says:

    Yeah – I’m curious about the history leading up to that, including why we were regulated by the PSC for a few years in the 1980′s, and then flip-flopped back to City Council. If we weren’t Entergy’s smallest subsidiary by far, they couldn’t isolate their worst damages with such surgical precision.

  13. PoBoy Says:

    Ms. Becky,

    Entergy does what it does because some judge says it’s OK by law. WHAT?
    Rule of law has taken us just so far. Now we need to evolve to something more or we as humans will no longer exist. Absent a revolution either our judges agree the moral thing to do trumps what is legal or we will be taken over by the most populous species on earth, insects.

  14. becky Says:

    Hi PoBoy,
    I’m not sure I want to chuck the rule of law just yet. Law evolves too, after all. And despite how well regulated ant hills and beehives are, I’m not sure I’d find insect law preferable to our variety.