By Amanda Durish Cook
FERC last week rejected the city of Osceola’s demand that Entergy Arkansas provide refunds for unlawful bandwidth equalization payments it allegedly passed on to the city over three years. The commission said Osceola had already settled its claim with Entergy and is not entitled to another set of refunds (EL 16-7).
The northeastern Arkansas city took issue with Entergy’s 2007, 2008 and 2009 formula rate update proceedings. Osceola asked that Entergy refund $4.48 million plus interest for charges it said were improperly passed on to the city.
The city argued that Entergy violated the filed rate doctrine because the formula rate in Entergy’s service agreement precedes FERC’s 2015 Entergy bandwidth remedy, which was created to equalize production costs among Entergy’s several companies by making sure no Entergy arm has production costs 11% above or below the Entergy system average.
Osceola said the dispute was “substantially identical” to a dispute Entergy had with Union Electric, which obtained bandwidth payment refunds.
But FERC found that Osceola previously settled the claim in “black-box” settlements.
“We find that these pleadings, settlement agreements and commission orders fully dispose of the complaint. … We likewise decline to invade the formula rate update proceedings’ privileged settlement negotiations by discussing which party sought or provided what data or by inquiring what lies inside the black-box agreements,” FERC wrote.
