City Council, Entergy Battle Over Apparent Past Failures and Future Relationship

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A calm but defiant City Council President Helena Moreno led other members in a full-throttle preliminary dialogue of Entergy’s actions “before, during and in response to Hurricane Ida” while Entergy sought to minimize their responsibility and signal possible change in the very nature of its decades-long and extremely profitable relationship with the City of New Orleans.

The hours-long occasionally contentious exchange took place at the City Council Utilities Committee meeting where all seven Councilmembers and dozens of citizens lined up to blast Entergy for what they considered a blatant failure to provide reliable electric service. Not since Councilmember Joe Giarrusso’s grandfather, affectionately known as “Chief Giarrusso” from his years of service to the NOPD, who chaired the Council’s Utilities Committee with a firm hand in the 1980’s, has so much been at stake for both sides.

In her opening remarks Council President Moreno said the citizens of New Orleans must receive “safe, reliable and affordable” electric and gas services. She clearly and distinctly addressed the issue at the heart of most New Orleanians’ concerns – if Entergy had made the proper investment in “hardening” the transmission system.

As New Orleans’ only Fortune 500 company, Entergy has always focused on their stockholders and bottom line. Though Moreno reminded Entergy New Orleans (ENO) president Deanna Rodriguez that Entergy earned a $1.4 billion record profit last year, Rodriguez countered that Entergy New Orleans’ contributed only a small portion of that total.  

Moreno told Entergy officials that she expected them to do their job. She rebuked them to stop acting like the victim -“you are the Goliath,” Moreno said, who also explained that she was not looking for a fight, just more honesty and transparency.

Rodriguez apologized for the hardship felt by many New Orleanians. “We live here too. We went through the storm with you,” she said. Rodriguez said that 24,000 men and women from 41 states came to the mutual aid of Louisiana to help rebuild the state’s transmission system. She estimated that 5,000 of those workers were dedicated to the New Orleans area.

Rodriguez also says she was proud of what Entergy crews did to restore 95% of Orleans Parish customers in less than 10 days. Though she admitted that “Entergy could have done some things better,” Rodriguez was “impressed by the resilience of the community.”  

She praised the New Orleans Power Station (NOPS) for helping “bring first light” back to New Orleans. “NOPS played a huge role in getting power back on especially for hospitals, fire and police stations,”  explained Rodriguez. Although NOPS teamed up with repaired transmission lines from Slidell rather than solely through the much acclaimed “Black start” feature, Entergy believes that without that combination it would have taken much longer to restore power. 

Rodriguez also admitted that a portion of the power generated by NOPS might have helped restore power in St. Bernard Parish – which does not pay any of the costs of building and maintaining the structure. But she also pointed out that New Orleans benefits from the Ninemile Point in Jefferson Parish. The Council hopes that during the upcoming investigation that definitive information will surface as to NOPS’ exact capabilities.  

Rodriguez agreed to work collaboratively with Moreno and the Council to strengthen the relationship with MISO (the Midcontinent Independent System), which manages the regional utility grid. Moreno and Rodriguez both agreed that additional redundancy is needed from MISO South and the costs of upgrading rather than repairing the system will have to be balanced.    

During the public comment period, Monique Hardin from the Deep South Center for Environmental Justice urged the Council to not let Entergy charge back to ratepayers the legal costs associated with a class action lawsuit regarding Entergy’s Hurricane Ida power failure that was filed earlier this week on New Orleans residents affected by the storm.  

The Center’s Dr. Beverly Wright encouraged Council members to think about middle class black people, the backbone of the economy, who are tired of outages and believe New Orleans is a “company town” run by Entergy. “You have responsibility and ability to do awesome things, no longer be a rubber stamp for Entergy,” Wright said. She considers NOPS a health issue and always opposed the plant because Blacks overwhelmingly suffer from environmental pollution. 

According to the New York Times, on August 4 – weeks before the storm hit – Entergy executive Leo P. Denault told Wall Street financial analysts that Entergy was replacing its towers and poles with equipment “able to handle higher wind loading and flood levels.” The Times also reported that many of Entergy’s power lines, towers and poles “were built decades ago to withstand much weaker hurricanes” and that the company had not upgraded or replaced “a lot” of that equipment with more modern gear designed to survive the 150-mile-an-hour wind gusts that Ida brought to bear.

Even though a hurricane like Ida would have been a problem to any power system without significantly updated equipment, many experts agree that Entergy was definitely not prepared for the storm’s intensity and devastation. 

An investigative piece published September 22 by the non-profit newsroom ProPublica working with WWNO/NPR alleges that Entergy New Orleans, along with its parent company, failed to take the necessary steps to protect its customers against outages despite opportunities after several big hurricanes to build more resilient systems. 

“Entergy has aggressively resisted efforts by regulators, residents and advocates to improve its infrastructure. The company’s restoration of its equipment after major storms didn’t prioritize the grid modernization that industry experts say could limit the scope and duration of power outages. Instead of shifting toward renewable energy, Entergy doubled down on building plants that emit greenhouse gases – the same pollution that has made hurricanes more intense,” ProPublica wrote. “Unless Entergy New Orleans and Entergy make bold investments in New Orleans’ aging grid, extreme storms fueled by climate change will bring more dangerous and prolonged outages.”

At Wednesday’s meeting of the Council’s Utilities Committee, a series of motions were forwarded for final approval at Thursday’s City Council meeting. The motions will signal the start of multiple investigations including a review of Entergy’s Hurricane Ida actions, a management audit, and a utility ownership reform report. 

The Council will also ask the Louisiana Public Service Commission, the Federal Energy Regulatory Commission and the North American Electric Reliability Corporation to review Entergy Louisiana’s LLC’s maintenance of the transmission system serving the City of New Orleans. Much of the transmission towers that failed to provide service to New Orleans customers after the storm hit are owned by Entergy Louisiana.

Some of the studies will be conducted by City Council utility in-house staff and existing consultants.  Others will be subject to bid. The Council is also seeking new Utility Advisors which may lead to different firms being hired for different projects rather than one master team of advisors working year-round.  

Entergy seems to be clear that they would like to get out from under the City Council’s control by selling the company and/or its assets or even moving jurisdiction to the easier-to-manipulate Louisiana Public Service Commission. Prior to Moreno’s reign as Utilities Committee Chair, Entergy often enjoyed an overly-cozy relationship with regulators which helped create at least some of the problems the city is facing today.    

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