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PSC to Hold Hearing on Entergy Rate Increase

2 min read

The Arkansas Public Service Commission will hold a hearing today on Entergy Arkansas Inc.’s request to raise electric rates this year.

The increase, originally announced in April 2015, amounts to about 8 percent for the utility’s typical residential customer. Entergy Arkansas says a residential customer using 1,000 kWh would see his bill rise by about 27 cents a day. 

If approved, the rate increase would take effect in April.

The public evidentiary hearing is set for 9:30 a.m. in the Commission Hearing Room in the PSC building at 1000 Center Street in Little Rock. Additional public comment hearings will take place in Batesville and El Dorado on Jan. 26 and Jan. 28, with location and time to be announced later. 

Entergy said the rate hike is necessary to make sure Arkansas continues to have a strong, reliable power system with the capacity to take on new industrial customers. It comes as the utility invests about $1.2 billion in its Arkansas grid, which includes hundreds of millions of dollars in upgrades to the company’s generation, distribution and transmission operations. 

The investment also includes Entergy Arkansas’ purchase of a $237 million, 495-megawatt power unit at the Union Power Station in El Dorado, announced in December 2014.

The original rate increase was pegged at 13 percent, which would have made the typical residential customer’s bill rise by $13, or about 45 cents a day. But Entergy revised the rate in a settlement agreement with several parties — the state attorney general’s office; the Arkansas Advanced Energy Association; the Arkansas Electric Energy Consumers; the Federal Executive Agencies; the Hospitals and Higher Education Group; and the Kroger Co. — filed Dec. 31.

Sally Graham, an Entergy spokeswoman, said the increase is likely to be offset by decreases to the Energy Cost Recovery rider and the Production Cost Allocation rider. 

“Due to lower fuel prices, Entergy Arkansas expects to file for a decrease in Rider ECR effective April 2016, at the same time that base rates will increase,” Graham said in an email to Arkansas Business. “When Rider PCA is re-assessed in July 2016, the new rate is expected to further reduce the impact of the base rate increase.” 

Entergy Arkansas last applied for a rate increase in March 2013. The utility provides electricity to about 700,000 customers in 63 counties.

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