Entergy has 30 days to file plan

PSC wants details of firm’s future

— The Arkansas Public Service Commission on Friday ordered Entergy Arkansas to submit within 30 days its plans on joining a regional transmission organization.

It also ordered the utility, which has 698,000 customers in Arkansas, to file “a concrete, integrated plan” by Jan. 11 to show how it plans to operate after it leaves the Entergy Corp. system agreement.

Entergy Arkansas told Entergy Corp. in December 2005 that it would leave the agreement by December 2013.

The pact has been the reason Entergy’s Arkansas customers are paying more than $4.5 billion over more than 20 years of federally mandated charges. About $1.5 billion has been paid to equalize energy costs between Entergy Corp.’s customers in Louisiana and Arkansas. The other $3 billion has been paid since the mid-1980s for costs associated with the Grand Gulf Nuclear Station in Port Gibson, Miss.

A regional transmission organization has the responsibility to route electricity throughout several states.Entergy has indicated that it plans to join Midwest Independent Transmission System Operator of Carmel, Ind., the coordinator of electricity over 13 midwestern states.

Entergy Arkansas’ plans for leaving the system agreement should include plans for how it will generate electricity and acquire resources for electricity generation, the commission said, adding that the utility’s filings on this subject have been “incomplete, at best.”

Entergy Corp. also has indicated it may join Midwest, along with its five other subsidiaries. Even if that happens, Midwest has said that Entergy Arkansas could remain separate from the other Entergy companies.

To remain apart from Entergy Corp., Entergy Arkansas could sign a completely separate transmission owners’ agreement with Midwest, Clair Moeller, Midwest’s vice president of transmission asset management, said in testimony before the commission last month.

Dan Daugherty, an Entergy spokesman, said in a prepared statement that “we appreciate the Commission’s guidance in [Friday’s] order and are pleased that the commission believes that Entergy Arkansas’ plan to join [a regional transmission organization] is prudent. Entergy Arkansas will make its change of control filing . . . within the next 30 days.”

Earlier this year, Entergy Arkansas announced it would join Midwest instead of Little Rock based Southwest Power Pool, which routes the electricity in nine states. Southwest currently is an independent coordinator of Entergy Corp.’s transmission system.

The general staff of the commission has said that Entergy Arkansas’ decision to join Midwest is reasonable, said John Bethel, executive director of the staff.

The commission took no position on which regional transmission organization Entergy Arkansas should join.

The commission also directed Entergy Arkansas to continue to pursue the possibility of operating as a stand-alone company where it wouldn’t be a member of any regional transmission operator, Bethel said.

No matter what decisions the utility makes, it needs to be independent of the other Entergy Corp. subsidiary companies, which would be “risk mitigation against future Entergy litigation,” the commission said.

“In fact, it is the commission’s desire to have [Entergy Arkansas’] relationship with the other [Entergy Corp. subsidiaries] as limited as practical,” the commission said.

The commission is expected to make a final decision on Entergy Arkansas’ plans by next summer. Entergy Arkansas has said that should give it enough time to prepare to exit Entergy Corp.’s system agreement by December 2013.

Business, Pages 33 on 10/29/2011

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