Louisianans have seen their energy bills skyrocket as temperatures soar and air conditioners run more frequently.
Next month, Entergy Louisiana customers will see a slight increase in electricity prices, the utility said in a press release. Customers were spared a big rate hike after the state's Public Service Commission approved two settlements with the utility.
One of the settlements resolves claims the company mismanaged its Grand Gulf nuclear power plant in Mississippi and overcharged customers.
The deal will offset the rate hike and return millions of dollars to customers.
For the rate increase, the PSC, which regulates Entergy, modified the utility's formula rate plan and voted in favor of the smaller hike Wednesday.
"In the proceeding that concluded today, we pulled at all the threads of what goes into those rates and reformed them to reflect a more fair and up-to-date pricing scheme," Commissioner Davante Lewis said in a press release. "As part of this reset, we negotiated the settlement of several significant outstanding disputes that will collectively result in savings to customers totaling nearly $260 million. Those credits are a win for customers directly and allows a clean slate for the PSC to continue its work for customers prospectively."
Starting next month, customers will see an annual increase of about 2%―roughly $4 a month, according to Lewis. Entergy Gulf States customers can see an annual increase of 3%, the company said.
The company said Legacy customers who use 1,000 kWh per month should see an initial bill increase of about $0.20.
Last year, Verite reported bills in New Orleans were rising at a historic pace. Climate change is partly to blame. On top of the costs associated with strengthening the storm grid, prolonged heat waves and frequent record-breaking temperatures have also led to higher bills. Experts predict the cost of keeping houses cool this summer could jump by 9% on average across the United States.
"Louisiana has some of the highest energy burden in the country, meaning that a large percentage of Louisiana residents pay upwards of 25 to 30% of their monthly income on electricity bills alone. So, being able to reduce that burden for folks is something that we see as a big win. A big success," Jessica Hendricks, the State Policy Director with the Alliance for Affordable Energy told the Coastal Desk's Eva Tesfaye.
Entergy also agreed to reduce late fees from 5% (one of the highest in the country) to 1.5%, a 70% reduction. It also waived reconnection fees for customers with SMART readers. According to the Alliance for Affordable Energy, the changes were made to help low-income customers.
"Folks that are overdue or have a past due balance on their Entergy account [were] previously charged 5% for a late fee. So if you have a $100 bill, that would be $5. And this new settlement reduces that to 1.5%, so it would go down to a $1.50 in late fees," Henry explained. "So we're excited about that. We're also excited that for all smart metered customers, the disconnection and reconnection fees have been eliminated."
In April, the PSC approved Entergy’s $1.9 billion grid-hardening plan, which came with its own rate hike. On Wednesday, the commission said it hired an engineer to monitor the progress on upgrades, which are paid for by customers.
“Anyone in Louisiana can tell you that our power grid is unreliable. We have a lot of blue sky outages where the power just goes out,” said Hendricks. “So, I think there's definitely a need to make some upgrades so that we can keep the power on for folks.”
