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
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
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
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.
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.