Fuel Adjustment Clause Ratepayer Litigation

ERG staff provided expert testimony on behalf of the Council of the City of New Orleans (Council), which consisted of a ratepayer suit which alleged that Entergy New Orleans, Inc (ENO) improperly passed certain charges through its fuel adjustment clause to ENO’s retail electric ratepayers for a period of many years. In addition, the plaintiffs alleged that ENO improperly favored its own generating resources and those of its unregulated subsidiary over other third party merchant generators, thereby increasing the costs of purchase power to ENO ratepayers. Based upon ERG’s findings, the Council issued an Order covering final resolution of the docket, which resulted in a refund of approximately $7 million plus interest to ENO ratepayers. Additionally, as part of its Order, the Council ordered ENO to provide the Council with annual reporting related to it’s (i) supply plan; (ii) margin/discount analysis; (iii) and transmission studies regarding power supply imports. Though appealed numerous times by the Plaintiffs which claimed overcharges of approximately $35 million, The Louisiana Supreme Court ruled that the Council’s ordered refund of $7 million was appropriate.

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