Entergy 2007 Annual Report Download - page 69

67
Entergy Corporation and Subsidiaries 2007
Notes to Consolidated Financial Statements continued
surcharge over a two-month period and agrees that the incremental
capacity recovery rider will be set to collect $21 million on an annual
basis eective February 2008. Amounts collected through the rider
and interim surcharge are subject to nal reconciliation.
In October 2007, Entergy Texas led a request with the PUCT to
refund $45.6 million, including interest, of fuel cost recovery over-
collections through September 2007. In January 2008, Entergy Texas
led with the PUCT a stipulation and settlement agreement among the
parties that updated the over-collection balance through November
2007 and establishes a refund amount, including interest, of $71
million. e refund is to be made over a two-month period beginning
February 2008. e PUCT approved the agreement in February 2008.
Amounts refunded through the interim fuel refund are subject to nal
reconciliation in a future fuel reconciliation proceeding.
In March 2007, Entergy Texas led a request with the PUCT to
refund $78.5 million, including interest, of fuel cost recovery over-
collections through January 2007. In June 2007 the PUCT approved
a unanimous stipulation and settlement agreement that updated the
over-collection balance through April 2007 and established a refund
amount, including interest, of $109.4 million. e refund was made
over a two-month period beginning with the rst billing cycle in July
2007. Amounts refunded through the interim fuel refund are subject
to nal reconciliation in a future fuel reconciliation proceeding.
e Entergy Texas rate ling made with the PUCT in September
2007, which is discussed below, includes a request to reconcile $858
million in fuel and purchased power costs on a Texas retail basis
incurred over the period January 2006 through March 2007.
In May 2006, Entergy Texas led with the PUCT a fuel and purchased
power reconciliation case covering the period September 2003 through
December 2005 for costs recoverable through the xed fuel factor rate
and the incremental purchased capacity recovery rider. Entergy Texas
sought reconciliation of $1.6 billion of fuel and purchased power
costs on a Texas retail basis. A hearing was conducted before the ALJs
in April 2007. In July 2007, the ALJs issued a proposal for decision
recommending that Entergy Texas be authorized to reconcile all of
its requested xed fuel factor expenses and recommending a minor
exception to the incremental purchased capacity recovery calculation.
e ALJs also recommended granting an exception to the PUCT rules
to allow for recovery of an additional $11.4 million in purchased power
capacity costs. In September 2007, the PUCT issued an order, which
armed the ultimate result of the ALJs’ proposal for decision. Upon
motions for rehearing, the PUCT added additional language in its order
on rehearing to further clarify its position that 30% of River Bend should
not be regulated by the PUCT. Two parties led a second motion for
rehearing, but the PUCT declined to address them. e PUCT’s decision
has been appealed to the Travis County District Court.
Entergy Gulf States Louisiana and Entergy Louisiana
In Louisiana, Entergy Gulf States Louisiana and Entergy Louisiana
recover electric fuel and purchased power costs for the upcoming
month based upon the level of such costs from the prior month.
Entergy Gulf States Louisiana’s purchased gas adjustments include
estimates for the billing month adjusted by a surcharge or credit that
arises from an annual reconciliation of fuel costs incurred with fuel
cost revenues billed to customers, including carrying charges.
In August 2000, the LPSC authorized its sta to initiate a proceeding
to audit the fuel adjustment clause lings of Entergy Louisiana
pursuant to a November 1997 LPSC general order. e time period
that is the subject of the audit is January 1, 2000 through December
31, 2001. In September 2003, the LPSC sta issued its audit report and
recommended a disallowance with regard to an alleged failure to uprate
Waterford 3 in a timely manner. is issue was resolved with the March
2005 global settlement. Subsequent to the issuance of the audit report,
the scope of this docket was expanded to include a review of annual
reports on fuel and purchased power transactions with aliates and
a prudence review of transmission planning issues and to include the
years 2002 through 2004. Hearings were held in November 2006. In
December 2007 the ALJ issued a proposed recommendation and dra
order that, with minor exceptions, found in Entergy Louisiana’s favor
on the issues. e LPSC has not issued a decision in this proceeding.
In January 2003, the LPSC authorized its sta to initiate a proceeding
to audit the fuel adjustment clause lings of Entergy Gulf States
Louisiana and its aliates pursuant to a November 1997 LPSC general
order. e audit will include a review of the reasonableness of charges
owed by Entergy Gulf States Louisiana through its fuel adjustment
clause in Louisiana for the period January 1, 1995 through December
31, 2002. Discovery is underway, but a detailed procedural schedule
extending beyond the discovery stage has not yet been established, and
the LPSC sta has not yet issued its audit report. In June 2005, the
LPSC expanded the audit period to include the years through 2004.
Entergy Mississippi
Entergy Mississippi’s rate schedules include an energy cost recovery
rider which is adjusted quarterly to reect accumulated over- or
under-recoveries from the second prior quarter.
Entergy New Orleans
Entergy New Orleans’ electric rate schedules include a fuel
adjustment tari designed to reect no more than targeted fuel and
purchased power costs, adjusted by a surcharge or credit for deferred
fuel expense arising from the monthly reconciliation of actual fuel
and purchased power costs incurred with fuel cost revenues billed to
customers, including carrying charges. In June 2006, the City Council
authorized the recovery of all Grand Gulf costs through Entergy New
Orleans’ fuel adjustment clause (a signicant portion of Grand Gulf
costs was previously recovered through base rates), and continued
that authorization in approving the October 2006 formula rate plan
ling settlement.
Entergy New Orleans’ gas rate schedules include an adjustment
to reect estimated gas costs for the billing month, adjusted by
a surcharge or credit similar to that included in the electric fuel
adjustment clause, including carrying charges. In October 2005, the
City Council approved modication of the current gas cost collection
mechanism eective November 2005 in order to address concerns
regarding its uctuations, particularly during the winter heating
season. e modications are intended to minimize uctuations in
gas rates during the winter months.