Representing the Council of the City of New Orleans, and working in concert with the other four regulators of Entergy Corporation, members of the Firm participated in the management audit of Entergy Corporation’s affiliated transactions. The audit was performed pursuant to a Settlement Agreement between Entergy and the Council and certain other regulators. The objectives of the audit were to determine if:
- Affiliate agreements, procedures and controls are appropriate to provide cost-effective service to the system operating companies;
- The accounting and allocation procedures and controls (that address cost allocation and cross-subsidization issues) are appropriate, fair and equitable;
- System operating companies are properly insulated from the adverse effects, if any, of non-regulated business activities;
- Adequate procedures and controls are in place to prevent improper disclosure of business or proprietary information by regulated companies to affiliates, their employees and employees of other system companies providing services to non-regulated businesses;
- An adequate “wall” of procedures and controls exists between regulated and non-regulated operations.
The City of Stillwater, Oklahoma retained ERG to conduct an objective assessment of the management and operations of the Stillwater Utilities Authority’s ability to perform effectively in an increasingly competitive electric utility environment. In conjunction with the engagement, ERG conducted extensive interviews with utility management and staff, as well as with City officials, and the Authority’s major industrial and commercial customers. Upon completion of study work, ERG presented a detailed report of findings concerning the Authority’s competitive position; the effectiveness of the existing management practices; organization and staffing issues; customer service operations; Adequacy of the planned capital improvements program; appropriateness of the current level of operations & maintenance expenditures, and adequacy of existing training and safety programs. ERG’s report included specific recommendations for improvements, as well as a long-term strategic implementation plan.
Members of the Firm were selected to assist the City Council of Lansing to conduct an independent and objective assessment for the City and its Finance Department of the management and operations of the City’s Board of Water & Light (BW&L), and to provide to the City and the Finance Department a realistic appraisal of the current and potential competitive efficiency and effectiveness of BW&L’s major business activities. Based upon extensive discussions with the City, the scope of study provided for: a competitive assessment of BW&L; a Focused Management and Operations Audit; an evaluation of the City’s Wastewater Treatment Plant Operations including methodology for determining sewer rates; an evaluation of the potential duplication of services between the City and the BW&L and the Wastewater Treatment Plant and BW&L; and the evaluation of and recommendations concerning proposals received by the City, if the City elects to implement any of the future options regarding ownership of BW&L.