Like many ravaging storms that came before it, Hurricane Ida exposed the fragility of Louisiana’s power grid, knocking out electricity to hundreds of thousands of people and businesses, including nearly all of New Orleans. It also laid bare growing doubts about the ability of the state’s largest energy provider to protect against the effects of climate change, including the increasingly destructive weather it causes.
The company, Entergy Corp., has told regulators and shareholders that it is committed to protecting the grid against extreme weather, having spent billions of dollars to upgrade towers, poles and lines.
But Entergy also has a history of resisting changes that would have made the electric grid more resilient, from developing new transmission lines to expanding solar power, according to an examination of regulatory filings and other public documents and interviews with industry researchers and clean-power proponents.
These actions show that while Entergy isn’t opposed to renewable power, it fights projects it doesn’t control and doesn’t want competition from other companies or homeowners trying to generate their own power from the sun. That has angered local elected officials and environmental advocates, who say Entergy is blocking needed change to maintain its dominance of the local energy market.
The New Orleans City Council, which regulates a local Entergy subsidiary, is using the Ida outages to force a reckoning on Entergy. The council announced an investigation of the failures that led to the citywide blackout and asked state and federal regulators to review the company’s planning for long-range power lines. Fourteen deaths have been attributed to Hurricane Ida in New Orleans, 10 of which were caused by excessive heat during the outage, according to the Louisiana Health Department.
The council fined Entergy $5 million in 2018 for hiring actors to pose as proponents of a new power plant and $1 million more in 2019 for failing to maintain poles and lines (Entergy is suing to appeal the latter fine). In March, the council launched a management audit of the company following outages during an extreme cold snap.
“It comes down to credibility,” said council member Joe Giarrusso, a member of the Utility, Cable, Telecommunications and Technology Committee. His message to Entergy: “You are providing one of the city’s most crucial resources, and the people who live here have a right to know what has happened.”
Entergy, which reported $1.4 billion in profits last year, said in a statement that claims that it delays expanding of transmission lines “are without merit and have no basis in fact.” The company said that it is “actively working toward a carbon-free future,” and that its system has become more reliable in recent years.
The frustration in New Orleans reflects wider problems with America’s fractured energy system and President Joe Biden’s hopes to transform it into a seamless network able to harness new sources of solar, wind and other clean power. Biden’s $1.2 trillion infrastructure plan calls for billions of dollars for new transmission lines and the creation of a federal agency that would remove bureaucratic obstacles to developing them.
That kind of overhaul would be a challenge for regional monopolies like Entergy, an investor-owned utility whose business model relies on control of its network of fossil fuel-burning power plants and transmission lines.
Entergy says it supports a transition to renewable energy and a stronger grid. But it has acted against that goal while preserving its dominance over a power market that stretches across Texas, Louisiana, Mississippi and Arkansas, according to researchers and clean-power advocates.
The results, critics say, are missed opportunities to better withstand extreme weather, draw electricity from more sources and restore power after storms more quickly.
During Ida, all eight of Entergy’s high-voltage transmission lines into New Orleans failed. Seven months earlier, when a February storm disabled many power plants in Entergy’s region, there weren’t enough transmission lines to deliver necessary power from other parts of the country, leading to widespread outages, according to a report on the storm from the Midcontinent Independent System Operator, or MISO, which oversees the grid.
John Norris, a former member of the Federal Energy Regulatory Commission who advocates for renewable energy, said the two events illustrate the consequences of Entergy’s hindering the development of a larger and more resilient grid.
“Our frustration with what’s going on precedes Ida, precedes the freeze last February,” Norris said. “But it’s just a chance for us to draw people’s attention to the fact that this is still not moving forward.”
Protecting a monopoly
Entergy, formerly known as Middle South Utilities, has existed in various forms for more than a century, wielding considerable political power in the states where it operates. Its headquarters are in New Orleans, where it is the city’s only Fortune 500 company.
Like almost all investor-owned utilities, Entergy operates as a state-sanctioned monopoly, allowed to act as the sole electricity provider in its region while subject to strict oversight by government regulators, including of the rates it charges customers. In recent decades, the federal government has tried to bring competition to power markets by forcing utilities to give…
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