By Amanda Durish Cook
FERC has accepted a compliance filing from Entergy on a settlement meant to resolve a more than 20-year-old dispute between the utility and the Louisiana Public Service Commission — a settlement that may or may not be moot.
On Wednesday, FERC accepted Entergy’s revision to make the settlement’s “just and reasonable” standard of review provision applicable to third parties, a change FERC ordered last September (EL00-66-021).
The issue dates to 1995, when the Louisiana PSC and New Orleans City Council filed a successful complaint with FERC, arguing that Entergy’s formula for determining peak load responsibility in its multistate-wide system agreement was unfair because it included interruptible load, in addition to firm load.
The Entergy System used to be more integrated, with Entergy’s operating companies’ transmission and generation facilities operated as a single electric system, and its system agreement consisting of several service schedules that allocated costs among the operating companies according to a responsibility ratio.
After a volley of appeals and remands involving the D.C. Circuit Court of Appeals, FERC ultimately required Entergy to remove all interruptible load from its cost allocation. However, after a series of conflicting rulings, FERC ultimately declined to order refunds, concluding that while the utility failed to have an equitable cost allocation, it did not over-collect. FERC explained that “in a case where the company collected the proper level of revenues, but it is later determined that those revenues should have been allocated differently, the commission traditionally has declined to order refunds.” It also found that “refunds would impose potentially unrecoverable costs” on the Entergy companies.
Entergy said that because the commission’s ruling not to order refunds “render[s] the performance of the settlement agreement moot,” FERC recounted. “Entergy states that the September rehearing order resolved those pending matters and while it is making the requisite compliance filing, the refunds for the 15-month refund period will not be paid.”
But the Louisiana PSC argued that FERC’s decision against refunds is “not a final, non-appealable” order and it’s still possible that refunds could be granted on an appeal the utility filed with the D.C. Circuit last year.
FERC said, however, that the Louisiana appeal was not the issue.
“While the parties hold differing views on the finality of the orders in this proceeding … the issue now before us for decision is whether Entergy’s compliance filing complies with the requirements” of its September order, FERC said.
