posted on Thursday, June 22, 2006 9:55 AM by Tracy Davis

Entergy's Cost-Based Tariffs Rejected and Set for Hearing

On May 26, FERC rejected Entergy's proposed cost-based tariffs as unclear and confusing.  FERC then set the tariffs for an evidentiary hearing, and directed Entergy to submit a compliance filing resolving identified problems within 30 days.   FERC also rejected were Entergy's proposed cost-based rates for its marketing affiliate, EWO Marketing, because Entergy had failed to support the cost data associated with three of EWO's generators.  FERC, however, did accept Entergy's proposal to allow operating companies to negotiate cost-based rates for short-term transactions up to a ceiling equal to the incremental cost plus a 10% adder. 
 
Entergy initially decided not to pursue renewal of its market-based rate authorization last summer.  [See Entergy Will Not Renew Market-Based Rate Authority.]  In November of last year, the New Orleans-based holding company submitted two cost-based rate tariffs (one for all operating companies and the other for its marketing affiliates), which would apply to all sales of capacity and energy with terms of less than one year.  Entergy's proposed rates would have applied both within and outside its control area.