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Lower Fuel Costs Expected to Largely Offset Proposed Rate Increase

02/15/2016

Customer Bills Benefit from Current Energy Market

LITTLE ROCK, Ark. -- When Entergy Arkansas, Inc. files its annual "fuel and purchased power cost" adjustment this spring, the resulting rate decrease will largely offset a projected increase that will result from a base rate settlement proposal if the settlement is approved by the Arkansas Public Service Commission.

"It takes careful planning and efficient operations to mitigate the bill impact to our customers," said Hugh McDonald, president and CEO of Entergy Arkansas, Inc. "Our customers are reaping the benefit of the current energy market, combined with our timely acquisitions of modern, efficient and clean-burning combined-cycle natural-gas plants. All these factors combine to allow their rates to remain significantly lower than the national and regional averages," said McDonald.

The adjustment, set to be filed in March, will result in a $7.11 reduction in a 1,000 kilowatt-hour residential bill. Rider ECR is the vehicle through which Entergy Arkansas is compensated for what it spends on fuel at its power plants and for wholesale power purchased to supplement its own generation. The cost each Entergy Arkansas customer pays for fuel and purchased power appears as a separate line item on their bill called "Fuel & Purchased Power Cost."

In December 2015, the Arkansas Public Service Commission General Staff, along with Entergy Arkansas and certain interveners, filed a joint motion with the commission to approve a settlement agreement on Entergy’s request to increase base rates to recover costs. If approved, the requested increase, when combined with the significant decreases offered by the new fuel charge, will mean a net increase to monthly bills of about $1.30 to a residential customer using 1000 kilowatt-hours of electricity.

Entergy Arkansas provides electricity to approximately 700,000 customers in 63 counties. Entergy Arkansas is a subsidiary of Entergy Corporation, an integrated energy company engaged primarily in electric power production and retail distribution operations. Entergy owns and operates power plants with approximately 30,000 megawatts of electric generating capacity, including nearly 10,000 megawatts of nuclear power. Entergy delivers electricity to 2.8 million utility customers in Arkansas, Louisiana, Mississippi and Texas. Entergy has annual revenues of more than $12 billion and approximately 13,000 employees.

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