By David Ball
PORT ARTHUR — As with Hurricane Rita, Entergy customers will see an increase in their bills to cover repairs for power restoration from Hurricane Ike.
David Caplan, communication manager for Entergy-Texas, said the increase will not be right away and it’s too soon to tell how much the total bill will be since the company is still receiving bills.
“It hasn’t been submitted to the Public Utilities Commission (PUC), so we can’t tell what the estimate or range of total costs could be,” Caplan said.
According to a company press release, total restoration costs for the repair and/or replacement of the electrical facilities damaged by Hurricane Ike are estimated to be in the range of $525 million to $625 million.
“There’s a hurricane rider on the bill and what we call the average customer is paying $3.85 per 1,000 kilowatt-hours for Rita. Customers began paying on Rita on July 2007— 18 months after the storm. And Rita will be a 15-year process to pay off,” Caplan said. “It takes a while to determine what the specific costs will be and determine what the right amount will be. It goes through different parties and interveners to make sure the costs are right. It goes on for months.”
Caplan also said securitization plays a part in determining costs. Securitization is a bill passed by the Texas Legislature for the debt to be handled in a way that will cost less for the customer by reducing interest costs.
The bill’s synopsis reads HB624 amend the Utilities Code related to the securitization of the nonpassable delivery rates of transmission and distribution utilities by requiring the PUC to approve certain transactions related to the provision of the bill and to make an approval decision within 180 days of the PUC receiving the relevant transaction report.
After back-to-back strikes by catastrophic hurricanes in less than two weeks left nearly 1.7 million customers without electricity in four states, Entergy announced its utilities had restored power to all of the 705,400 customers affected by Hurricane Ike who can take power.
Entergy Texas and Entergy Gulf States Louisiana estimate restoration costs from Hurricanes Gustav and Ike are as follows:
• Entergy Texas with $435 million to $510 million from Hurricane Ike repairs
• Entergy Gulf States Louisiana $65 million to $75 million for Hurricane Ike repairs and $210 million to $250 million for Hurricane Gustav repairs
“It’s out there (upcoming increases in bills). It’s regrettable to go through the effects of the storm, but to make sure the system is back, it requires a cost recovery — that’s the way things work,” Caplan said. “In an ideal world, it would be nice for someone else to pay for this, like the government, but unfortunately Entergy customers do.
The rates will go through a highly intensive examination so that costs are reasonable. We appreciate everyone’s patience and understanding. We have to do this; we take no delight in this. But we have to keep solvent and prepared for the next time.”
