Energy companies blasted for performance during winter storm

Power companies want customers to pay higher bills following Winter storms

NEW ORLEANS (WVUE) - The recent extreme winter weather could mean more storm cost added to power bills, but the Public Service Commission said in their February 24th, 2020 meeting that energy providers should pick up more of the cost.

From rolling black outs to major outages all of Louisiana’s power providers saw issues during the cold snap. The companies say a spike in natural gas costs and usage accounts for some of the charge that could show up by late spring.

Commissioners hope to look at strategies to help limit the effect of recouping storm losses on top of losses already being charged to customers as restoration fees after last summer’s hurricanes.

Entergy Louisiana C.E.O. Phillip May said the company saw significant natural gas cost during the surge in power use as the storm caused problems across the region. May said, “I certainly agree with what you’re saying but I will say that because we had the double effect of one prices doubling and tripling sometimes more and the volume equally spiking that there is going to be a significant increase in what we spent on natural gas to your point it has since moderated, and I think that gives us an opportunity.”

CLECO Power President Shane Hilton said his company was in a similar position. Hilton said, “We are seeing the same thing. We saw record peak loads for the week. A significant increase in customer demand and an increase in prices.”

May said natural gas prices doubled and tripled during the storm as consumption increased and some delivery equipment froze reducing the supply.

The PSC says it wants to look at all the power companies’ rate of return in order to see how they can help foot the bill for some of the storm cost.

District 5 Commissioner Foster Campbell said, “Not just Entergy, SWEPCO, CLECO, somebody has got to sharpen a pencil and see how much money ya’ll are making. What are ya’ll putting in your rate base. I’m going to be real interested in how much money yall are making. What ya’ll are making? Can you reduce the rate of return? Instead of increasing the rates to the people can you have some rate reductions.”

Commissioners also criticized Entergy Louisiana in particular for poor communication with customers during the storm.

They shared emails and complaints from customers siting inaccurate information on outages on their website, wrong information on automated lines and a lack of ability to contact customer service. May apologized blaming many of the problems on the storm itself. He said storm conditions froze fiber cable of one of its communication providers causing hang ups and more than 25 percent of the customer service work force was unavailable due to travel conditions or digital infrastructure problems.

Commissioner Craig Greene of District 2 said, “People don’t like the way they were treated especially when they are going to be paying more and more. I think you all are a top rate energy provider, but a D minus communications.”

May said, “We appreciate those comments. We feel the frustration and the angst that was put upon customers because of the communications issues we had. As you noted we did not meet customer expectations.”

Campbell said, “you have a very special privilege in louisiana. We have to be very protective of the people we represent.”

The commission hopes the companies will absorb some of the storm cost. It’s standard to pass it along to the customer.

Campbell said, “I think about that and how to fix people. I don’t know what your bills are but if a bill goes up from $250 to $600. That’s going to be really hard to explain.”

May said Entergy suffered $2 billion in storm cost and it will take eighteen months to recoup over which time the shareholders do not profit.

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