Jackson Free Press

Read Adam Lynch's earlier story about Entergy's rate controversy here.

In his continuing battle with Entergy over an alleged "scheme," Attorney General Jim Hood just released the following statement, verbatim:

Jackson, Miss. -- Despite Entergy's claims to the contrary, estimates show that power sold to Mississippi from its Evangleine gas contract in Louisiana had a significant financial impact on Mississippi ratepayers. And to make matters worse for consumers, the Evangeline contract is just one example of a scheme that has cost Mississippians millions of dollars in increased electricity and fuel costs. "Entergy Mississippi's attempts to minimize the harm done to Mississippians by overcharging for power is indicative of its efforts to cover up illegal activities to which it has now admitted," said Attorney General Jim Hood. "Entergy has been less than truthful in the past and continues to be today."

Last week, Entergy admitted that it was mistaken when it stated that energy produced by the Evangeline (Louisiana) gas contract had not been sold through the Entergy System Exchange to Entergy Mississippi. Now, the company is trying to convince ratepayers that the effect on their pocketbooks was minimal at best. "So tell us, why should we believe Entergy's latest claims when they have already admitted to making false statements to the Mississippi Public Service Commission?" asked Attorney General Hood. "The truth about these illegal activities will soon be come to light."

Entergy now claims that the amount of energy sold to Mississippi from the Evangeline contract comprised only one percent of the total Entergy Mississippi load in megawatt hours used between 2005 and 2008. But, according to documents filed by Entergy Mississippi with the Federal Energy Regulatory Commission, the amount averaged closer to 8% in 2005 and 10 % for 2006 of total purchases by Entergy Mississippi from the Exchange. (Entergy Mississippi, Inc. FERC Form 1, 2005, at 326-327, line 2; Entergy Mississippi, Inc. FERC Form 1, 2006, at 326-327, line 2)

In fact, the figures that Entergy used in its miscalculations were prepared by the same individual found to have been involved in an earlier bid-rigging scheme by FERC. William Mohl was found to have engaged in "misuse of confidential information" and "affiliate abuse," according to FERC Order 485. Mohl, in that case, distributed requests for proposals for fuel purchases, received bids from independent companies, then, disclosed those bid amounts to an Entergy subsidiary, Entergy Arkansas, which allowed Entergy Arkansas to underbid the other companies.

FERC wrote that because of this misconduct, sales were being made at "sales prices that are unjust and unreasonable and that affiliate abuse occurred because of improper handling of sensitive pricing by senior Entergy management."

The exact monetary damage to Mississippians cannot be calculated until Entergy releases the documents that the state has repeatedly requested. But conservative estimates
show that, in 2005 alone, ratepayers may have been overcharged by millions of dollars.

"Again, it's time for Entergy to finally come clean," said Attorney General Hood. "If there's nothing to hide, then why not produce the documents."

The Evangeline gas contract is just one part of a larger scheme by Entergy to pad invoices and dump higher priced power on Mississippi, as charged in the state's lawsuit filed in December.
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Jan Schaefer
Public Information Officer
Office of the Attorney General
State of Mississippi
601-359-2002 (office)