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Regulators raise concerns about Entergy transmission line sell-off

The Public Service Commission is moving closer to a vote on whether Entergy should be allowed to sell off nearly 16,000 miles of transmission lines.

The move comes as regulators express concern about losing control, just six weeks after massive outages caused by Hurricane Isaac.

Hurricane Isaac caused transmission and distribution line damage, which resulted in 900,000 Entergy customers losing power statewide, some for up to 10 days.

The Public Service Commission has launched an investigation just as it considers a proposal to allow Entergy Louisiana to sell off nearly 16,000 miles of transmission lines, some of which feed into Entergy New Orleans.

As head of the New Orleans City Council's utilities committee, Councilwoman Cynthia Hedge-Morrell gets a vote on the $1.8 billion plan to sell the lines to a Michigan-based company called ITC Holdings.  It could be the last regulatory vote the council ever takes regarding transmission lines.

"We will be part of a group that goes from Louisiana to Canada. We will be involved with states that have a very different situation than we do."said Hedge-Morrell.

ITC is the nation's largest independent power provider.

"If the sale goes through, watchdog groups say New Orleanians could wind up paying for transmission line improvements in other parts of the state, with the city receiving little or no benefit," warned Hedge-Morrell.

It all depends on the timing of a separate proposal to establish a program, called MISO, that will establish a new power grid. 

"If that program moves forward first, then New Orleans will still have the ability to set the rates for transmission.  But if transmission moves forward first, the feds will set those rates and they will be more expensive," says Casey Roberts with the Alliance for Affordable Energy.

Roberts says a sell-off has merit, though, in part because of ITC's expertise in the transmission line business.  But the alliance urges regulators to keep ratepayers in mind as they consider the deal.

Entergy New Orleans CEO Charles Rice says the sell-off will help Entergy make the kind of investments it needs to build and maintain a reliable, and cost-efficient electric system. 

If the transmission line sell-off goes through, ITC says it will absorb nearly 750 Entergy employees.

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