Entergy 2009 Annual Report Download - page 43

Entergy Corporation and Subsidiaries
Management's Financial Discussion and Analysis
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properly reflected generating units' minimum operating levels for purposes of making unit commitment and dispatch
decisions, whether Entergy Arkansas' sales to third parties from its retained share of the Grand Gulf nuclear facility
were reasonable, prudent, and non-discriminatory, and whether Entergy Louisiana's long-term Evangeline gas
purchase contract was prudent and reasonable.
The parties reached a partial settlement agreement of certain of the issues initially raised in this proceeding.
The partial settlement agreement was conditioned on the FERC accepting the agreement without modification or
condition, which the FERC did on August 24, 2009. A hearing on the remaining issues in the proceeding was
completed in June 2009, and in September 2009 the ALJ issued an initial decision. The initial decision affirms
Entergy's position in the filing, except for two issues that may result in a reallocation of costs among the Utility
operating companies. Entergy, the APSC, the LPSC, and the MPSC have submitted briefs on exceptions in the
proceeding, and the matter has been submitted to the FERC for decision.
2009 Rate Filing Based on Calendar Year 2008 Production Costs
Several parties intervened in the 2009 rate proceeding at the FERC, including the LPSC and Ameren, which
have also filed protests. On July 27, 2009, the FERC accepted Entergy's proposed rates for filing, effective June 1,
2009, subject to refund, and set the proceeding for hearing and settlement procedures. Settlement procedures have
been terminated, and the ALJ scheduled hearings to begin in April 2010, with an initial decision scheduled for August
2010.
Calendar Year 2009 Production Costs
The liabilities and assets for the preliminary estimate of the payments and receipts required to implement the
FERC's remedy based on calendar year 2009 production costs were recorded in December 2009, based on certain
year-to-date information. The preliminary estimate was recorded based on the following estimate of the
payments/receipts among the Utility operating companies for 2010:
Payments or
(Receipts)
(In Millions)
Entergy Arkansas $70
Entergy Gulf States Louisiana ($10)
Entergy Louisiana ($54)
Entergy Mississippi $-
Entergy New Orleans ($6)
Entergy Texas $-
The actual payments/receipts for 2010, based on calendar year 2009 production costs, will not be calculated until the
Utility operating companies' FERC Form 1s have been filed. Once the calculation is completed, it will be filed at the
FERC. The level of any payments and receipts is significantly affected by a number of factors, including, among
others, weather, the price of alternative fuels, the operating characteristics of the Entergy System generating fleet,
and multiple factors affecting the calculation of the non-fuel related revenue requirement components of the total
production costs, such as plant investment.
Interruptible Load Proceeding
In April 2007 the U.S. Court of Appeals for the D.C. Circuit issued its opinion in the LPSC's appeal of the
FERC's March 2004 and April 2005 orders related to the treatment under the System Agreement of the Utility
operating companies' interruptible loads. In its opinion, the D.C. Circuit concluded that the FERC (1) acted
arbitrarily and capriciously by allowing the Utility operating companies to phase-in the effects of the elimination of
the interruptible load over a 12-month period of time; (2) failed to adequately explain why refunds could not be
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