Bates White analysis projects “substantial” economic benefits to state, concludes SMEPA would benefit from following Entergy Mississippi into an RTO

JACKSON, Miss. – Mississippi stands to gain from a proposal by Entergy Mississippi Inc., to join a large regional transmission organization according to a recent analysis by Mississippi Public Service Commission consultants Bates White, LLC.

The consulting firm was hired by the MPSC to provide an independent analysis of Entergy Mississippi’s proposal to join the Midwest Independent Transmission System Operator, Inc. RTO and an assessment of the savings to Mississippi electricity customers. Conclusions find that the utility’s proposal entails “substantial prospective net economic benefits to Mississippi.”

Entergy Mississippi estimates its customers will save approximately a quarter of a billion dollars in the first decade alone of its proposed membership in MISO, a nonprofit organization that operates an RTO with an established organized market for the purchase and sale of wholesale electricity. Entergy Mississippi filed its formal request to join MISO last December.

“There are substantial prospective net economic benefits to Mississippi, along with the other Entergy operating companies and SMEPA, joining MISO,” the Bates White consulting report notes. The study further notes that “Independent production cost modeling directed by Bates White indicates that joining MISO would provide [Entergy Mississippi] with approximately $178 million more benefit than would [other alternatives evaluated], measured by reduced generation cost (10-year NPV).” The report also concludes that SMEPA in particular would benefit from following Entergy Mississippi into an RTO.

“The MPSC consultants’ report is more good news for energy customers in Mississippi,” said Haley Fisackerly, president and CEO of Entergy Mississippi. “It confirms what years of work and numerous studies have demonstrated—that our move to MISO is good for our customers and good for the communities we serve.”

“We’re eager to move forward with the technical conferences and hearings scheduled for next week,” Fisackerly added. “These steps in the MPSC’s review process can move us that much closer to capturing these great benefits for our customers.”

MISO is the oldest regional transmission organization and one of the largest, currently serving 11 states. If the Entergy utility operating companies were to join, MISO’s footprint would extend from Canada to the Gulf of Mexico, creating greater economies of scale and affording the benefits of MISO’s vast regional market.

Joining MISO means transferring functional control of Entergy Mississippi’s transmission system to the RTO. Naturally, such a change has impacts on many players in the state’s electric industry—including independent power producers and electric cooperatives served by the Entergy transmission system as well as the various retail customers and employees of the company. To lay the groundwork for upcoming hearings, the MPSC has scheduled a technical conference July 16. Representatives of the MPSC and stakeholders will have a chance to ask questions of the various witnesses who have filed testimony on behalf of the parties in the proceeding and to receive more information related to the Entergy Mississippi’s proposal to join MISO.

“We look forward to participating in this technical conference as part of our commitment to working closely with the Mississippi Public Service Commission, the Public Utilities Staff and other stakeholders. We want this process to be transparent and answer our key stakeholders’ questions,” said Bob Grenfell, Entergy Mississippi vice president of regulatory affairs. “We’ll continue to work closely with the commission to answer all questions pertaining to our proposal to join MISO.”

The conference will be held from 9 a.m. until 2 p.m. in Suite 100 of the Pinnacle Building on 190 East Capital Street.

Entergy Mississippi filed its formal request to transfer functional control of its transmission facilities to MISO with the Commission on December 2, 2011, following the submission, last May, of an Evaluation Report on behalf of the Entergy utility operating companies, which described the results of extensive analysis projecting Entergy Mississippi customers would experience $242 to $284 million of savings over 10 years (2013–2022) as a result of the move to MISO.

Following the technical conference, the MPSC will hear the case July 19–20, 2012, and a final order is expected later this summer.

If Entergy Mississippi joins MISO, the MPSC will be able to participate in MISO’s large-scale regional planning process and provide input to the organization’s management team and board of directors. Additionally, as Entergy Mississippi’s retail regulator, the MPSC will continue its oversight of Entergy Mississippi and its facilities.

“Our primary function is to provide reliable power at the lowest reasonable cost for our customers,” said Grenfell. “This technical conference is an excellent opportunity for stakeholders to learn more about how we accomplish that and the benefits our customers can expect from MISO.”

Entergy Mississippi, Inc. provides electricity to more than 435,000 customers in 45 counties. It is a subsidiary of Entergy Corporation. Entergy is an integrated energy company engaged primarily in electric power production and retail distribution operations. Entergy owns and operates power plants with approximately 30,000 megawatts of electric generating capacity, including more than 10,000 megawatts of nuclear power, making it one of the nation’s leading nuclear generators. Entergy delivers electricity to 2.8 million utility customers in Arkansas, Louisiana, Mississippi and Texas.

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In this news release, and from time to time, Entergy Corporation makes certain “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995. Except to the extent required by the federal securities laws, Entergy undertakes no obligation to publicly update or revise any forward-looking statements, whether as a result of new information, future events, or otherwise.

Forward-looking statements involve a number of risks and uncertainties. There are factors that could cause actual results to differ materially from those expressed or implied in the forward-looking statements, including (a) those factors discussed in: (i) Entergy’s Form 10-K for the year ended December 31, 2010 and (ii) Entergy’s other reports and filings made under the Securities Exchange Act of 1934, (b) uncertainties associated with rate proceedings, formula rate plans and other cost recovery mechanisms, (c) uncertainties associated with efforts to remediate the effects of major storms and recover related restoration costs, (d) nuclear plant relicensing, operating and regulatory risks, including any changes resulting from the nuclear crisis in Japan following its catastrophic earthquake and tsunami, and (e) legislative and regulatory actions, and conditions in commodity and capital markets during the periods covered by the forward-looking statements, in addition to other factors described elsewhere in this release and in subsequent securities filings.