Texas, Entergy deal could change how utility business is run
By Dan Wallach
Beaumont Enterprise
Prices still are high for customers in the competitive areas, but they do have some choice.
Entergy is still regulated because its service territory is outside the in-state electric grid. Having an in-state grid is important for retailers because they are assured open access to lines to get the power they buy wholesale to their customers.
Since no such arrangement exists for Entergy, the Public Utility Commission has no choice except to keep regulating it as it does a handful of other electric utilities arranged around the state’s border areas.
However, the state still expects Entergy to make its transition toward competition. To do that, Entergy has to get into a grid that allows for competition. Its current grid, the Southeast Electric Reliability Council, which covers a lot of the southeastern United States, doesn’t have any retail competition and isn’t viewed favorably as a place to start.
Entergy wanted to get into the Texas grid. Last week, the Public Utility Commission just about said “no,” because its plans were too expensive. Instead, commissioners asked Entergy to look at another power grid called the Southwest Power Pool, which covers parts of northeast Texas, Arkansas, Oklahoma, and parts of New Mexico and Colorado.
Entergy customers already are paying off more than $100 million in transition costs incurred since 2001 at a clip of about $1.08 per month.
During this year’s legislative session, state Rep. Allan B. Ritter, D-Nederland, tried to keep Entergy as a regulated utility because retail areas had higher rates. Ritter wanted to keep Entergy out of the Texas grid and keep it where it is. The bill passed the House and went nowhere in the Senate.
Ritter seems to have got part of his wish after all with last week’s action.
Meanwhile, Entergy has a rate increase request filed with the commission that would bring its rates for 1,000 kilowatt hours to about $130. That would put it about in the middle of the retail competitors in other parts of the state.
There are no guarantees that Entergy will get all or part of its request.
And all the customer wants is continuous service at a reasonable price.
From the utility’s viewpoint, it needs reasonable returns to stay financially healthy to give the customers what they want.