From the docket’s outset, The Alliance has drawn attention to the numerous potential ratepayer harms that will result if the Council approves the sale, as well as the negative effects on public health, climate mitigation, and clean energy development.
In addition to the basic facts that Delta States Utilities – the Bernhard subsidiary – has never served a single customer and that the sale would create yet another utility for beleaguered residents to contend with, DSU’s plans to aggressively expand fossil gas distribution infrastructure in the city will fall on the backs of a shrinking pool of vulnerable customers. The general trend toward electrification that is being accelerated by federal incentives – and the loss of a significant portion of retail gas revenue due to the electrification of the Sewerage & Water Board of New Orleans – means that DSU’s planned capital investments will fall disproportionately on residents who do not have the authority or the means to electrify their homes. Furthermore, the creation of a brand-new utility whose sole business is selling fossil fuels would be highly irresponsible in a city such as New Orleans which has suffered the worst effects of a climate changed by the burning of fossil fuels, and would set the city back in terms of its climate and clean energy goals.
The applicants ENO and DSU have pointed to uncertain economic benefits of the transaction, but have failed to meet the Council’s standard of proving both short- and long-term benefits to ratepayers. Neither the applicants nor the Council’s utility advisors have addressed the enormous bill increases that will result from DSU’s plans to expand gas infrastructure, the load defection of SWBNO, or the climate and clean energy effects of the decision.
The Mayor’s Office of Resilience & Sustainability (ORS) said, “Simply put, the sale of the natural gas portion of Entergy New Orleans, LLC to Delta States Utilities NO, LLC, is not in the public interest.” The ORS recommends the Council “forgo a sale that could have costly and negative side effects to residents and business owners of New Orleans.”
The Alliance has proposed that the city itself acquire the gas distribution system, with the goal of phasing it out in favor of cleaner forms of energy. Rather than continue to enrich a privately-owned utility, the City could hire an administrator to operate the system for the public’s benefit and with an eye on the future.
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