Jackson Free Press

In response to a controversy involving Entergy rate hikes, the Mississippi House of Representatives Public Utilities Committee passed a bill this week moving the Mississippi Public Utilities Staff back under the supervision of the Public Service Commission. As reported in the Jackson Free Press last week, Commissioner Brandon Presley and others are complaining that the separation has inhibited the Commission's ability to correctly audit Entergy and how it is imposing rates on MIssissippians.

Last week the Mississippi Public Service Commission refused to sign off on an audit report referred by the Public Utilities Staff, claiming that the report did not answer the question of whether Entergy Mississippi, the power company providing electricity to the majority of the state, bought the least expensive power it could in 2007, and may have consequently overcharged customers for the inflated power. Unlike the commission, governor appointees oversee the Public Utilities Staff.

Public Utilities Staff Executive Director Bobby Waites could not assure commissioners last week that the PUS report did not determine if Entergy Mississippi's procurement were at the "rock-bottom lowest price."

The new commission, occupied by members who won elections as recently as last year, has been flexing its watchdog muscles ever since Entergy requested a 30-percent rate increase on customers last July. Attorney General Jim Hood soon entered the picture, acting as the PSC's attorney, and charging the power company in court with buying more expensive fuel from its affiliates—which raised the company's stock—and charging customers for the higher prices instead of buying power from less expensive sources.

Entergy has reversed two earlier assurances since the Hood/PSC investigation of its practices. The company about-faced on an earlier claim to the PSC that a contract found liable in Louisiana for $72 million had no impact on Mississippi customers' fuel adjustment rates—a statement that commissioners found so inflammatory that they demanded it in writing. Then, this week, the company revealed to the PSC that the problematic Evangeline contract may have extended further back than it had initially told commissioners. Entergy first claimed the contract had not impacted Mississippi ratepayers outside the window of the years 2005-2008.

Hood questioned the timing of the surprise disclosures last week, linking them with the ongoing PSC and attorney general investigations of the company. He said company documents would have revealed the new information as the investigation progressed.

Entergy spokeswoman Mara Hartmann said the two corrections resulted from nothing more than the power company's continued efforts to audit its numbers.

"We've got thousands of documents that must be reviewed. There are literally hundreds of fuel purchasing transactions per day, thousands per week. That's why it's taking us so long to do such a thorought review," Hartmann said. "And as we go through this lengthly and complex analysis we'll be keeping our customers informed of our findings."

House Bill 1090 reverses a 1990 move by legislators to crack the Public Service Commission in two, after Public Service Commissioners David Snyder and Lynn Havens were convicted of extortion, bribery and conspiracy in 1989.

Snyder arranged for PSC approval of a power company's rate increases in return for that company's favorable treatment of businesses owned by Snyder and his friends. A jury also convicted Snyder in 1989 of taking monetary bribes, as well as not reporting the bribe money to the IRS as income.

The separation resulted in PSC auditors and accountants moving to the Public Utilities Staff, which is under the authority of governor-appointed people, as opposed to those hired by the commission. Very few states, including Vermont and North Carolina, have instituted a similar separation of power.

Northern District Public Service Commissioner Brandon Presley praised the committee this for passing the bill.

"This bill is a monumental step forward in streamlining government and giving the commission the necessary tools it needs to better protect ratepayers," Presley said. "No other state in America has a structure like the Mississippi PSC, where the elected representatives have all the accountability but no resources, and the separate, independent staff has all the resources and no accountability. That set-up just does not benefit ratepayers, as we have seen clearly with recent cases like Entergy's fuel-adjustment charges."

Presley played down the importance of separating the Utilities Staff from the Commission.

"That separation was kind of a knee-jerk reaction to a bad situation," Presley said. "That was a long time, and the current arrangement forces the commission to run inefficiently."