Here's how much customers in Terrebonne and Lafourche would save if regulators approve the governor's request.
BATON ROUGE -- The million customers of Entergy Louisiana could see their monthly bills drop by about $4 per month if the Public Service Commission heeds the request of Gov. John Bel Edwards and lowers rates to match savings from the federal tax rewrite.
"He's right," said PSC Commissioner Foster Campbell of fellow Democrat Edwards' letter released Thursday. "If these investor-owned companies get a break, they need to pass it down."
Edwards pointed out that Dominion Energy in South Carolina announced plans to lower its rates partially because of the new federal tax law and suggested that Louisiana utilities follow suit.
Based in Richmond, Va., Dominion is trying to purchase SCANA's South Carolina Electric & Gas Company for $7.9 billion and included rate reductions as part of that package.
Businesses would receive about a 14 percent reduction in tax rates under the new federal revamp, Edwards calculated, which should translate in Louisiana utility customers paying less.
The five elected commissioners on the PSC determine how much privately owned utility companies can charge the customers within service areas that are operated as a monopoly. Generally, the rates are set by calculating the cost of making and delivering electricity plus a profit. Tax costs are part of that calculation.
When asked for comment, Entergy Louisiana's press office released a statement saying the corporation is working with the PSC to analyze how the new tax law would affect customer rates. "ELL is working diligently to prepare for that report at the (February) commission meeting," the statement said.
Entergy Louisiana LLC provides electric service to more than 1 million customers -- roughly half the state -- in 58 parishes, including the greater Baton Rouge area, the New Orleans suburbs and much of Acadiana.
A typical residential customer using 1,500 kilowatt hours of electricity each month paid $130.63 in December. Of that figure, the base rate was $61.38. The rest is fees, surcharges to pay for storm recoveries and the cost of fuel to run the generators that make the electricity.
Louisiana had the lowest average residential electricity rates in the nation and the 12th lowest commercial supply rates, based on August and September data, according to Choose Energy Inc., a Plano, Texas-based online marketplace for electricity and natural gas..
Entergy customers also will see a reduction of between $4.73 and $6.80, depending on where they live, in October when the surcharge for restoring service after hurricanes Katrina and Rita roll off. The money was used to secure a loan that repaid Entergy for the work.
About half of the energy that Entergy Louisiana sells its customers is made in generators fueled with natural gas. Over the past three years, natural gas prices have dropped by approximately 38 percent compared to 2014 and been modestly lower during the second half of 2017.
Customers pay Entergy's costs for generator fuel but the company adds no profit.
Campbell, of Bossier Parish, said Entergy's tax savings would be about $100 million annually and that calculates out to about $4 per month for the typical residential customer in Louisiana.
Other utility companies in Louisiana also will be asked to lower their rates as well, Campbell said.
The possibilities were briefly discussed by the commissioners prior to Congress passing the tax rewrite. Campbell said he plans to bring the issue up at the PSC's next regular meeting on Jan. 17.
PSC Chairman Eric Skrmetta, R-Metairie, responded in a letter that he instructed the commission's staff to analyze the situation and report at the Feb. 21 monthly meeting.
"Once all the data is collected, the commission will order that all necessary and legal rate modifications are enacted and refunds in the forms of credits and that future rate reductions are put into effect," Skrmetta wrote.