Entergy Reaches Settlement on $2.3B Texas Rate Case
Entergy Texas
Entergy's Texas subsidiary struck a rate case settlement with state regulators to recover $2.3 billion for grid-modernization improvements it has completed.

Entergy (NYSE: ETR) said Wednesday its Texas subsidiary has struck a rate case settlement with state regulators to recover $2.3 billion for grid-modernization improvements it has completed.

Entergy Texas last year filed for base rate and rider revenues designed to collect $1.3 billion per year in non-fuel retail, an 11.2% ($131.4 million) increase on average across all customers classes. The settlement provides for a $54 million increase in base rate revenues, exclusive of incremental to costs being realigned from various riders and recovery factors, resulting in a non-fuel revenue requirement of $1.23 billion (53719).

The Texas Office of Public Utility Counsel, Texas Industrial Energy Consumers, Sierra Club, Kroger, Federal Executive Agencies and Walmart all signed on to the agreement, which is pending final approval from the PUC.

Entergy Texas spokesperson Kendra James said the settlement boils down to regulators agreeing to find that the company’s investments were prudent, reasonable and made for the customers’ benefit.

“It’s important to note that this amount is not an amount by which Entergy Texas rates will change. A portion of the cost of these investments will be recovered annually over the period in which they serve customers, which is decades for most large assets,” James said in an emailed statement to RTO Insider.

Entergy included the 993-MW Montgomery County Power Station, which went into commercial operations in January 2021 north of Houston, as part of the recent infrastructure upgrades. The plant was attributed as part of the reason MISO ultimately withdrew support for the only competitive transmission project it has ever recommended for MISO South. (See FERC Rejects Last-ditch Effort to Save Tx Project.)

The utility also pointed to its recent $41.3 million acquisition of the gas-fired, 146-MW Hardin County Peaking Facility from East Texas Electric Cooperative.

“Entergy Texas is continuously investing in customer-driven solutions to build a more reliable and resilient energy future for Southeast Texas communities,” Entergy Texas CEO Eliecer Viamontes said in a press release. “We are committed to balancing customer affordability with critical investments to help reduce outages and continue to strengthen the power grid.”

The company said it will also spend more than $2.5 billion by 2025 to continue replacing aging generation and harden infrastructure. It received the PUC’s approval last year to build the 1.2-GW natural gas and hydrogen-powered Orange County Advanced Power Station. Entergy recently broke ground on the project and expects it to be in service by 2026. (See Entergy, NextEra Tout Clean Energy Efforts.)

Entergy said the settlement’s terms will help ensure it stays “financially healthy and able to make the significant capital investments required to provide affordable, reliable and sustainable power.”


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