Report questions Entergy's Meta rate promise
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With shovels in the ground at Meta's new data center in Richland Parish, Entergy Louisiana is gearing up to power the new facility.
Why it matters: Despite promises that its deal with Meta wouldn't impact ratepayers, a new consultant report says the average Entergy Louisiana customer's bill could go up by $8 or more if the utility's new plan to buy a Texas power plant goes through.
Catch up quick: When Meta first announced its plans to put a massive new data center in North Louisiana, Entergy Louisiana planned to build three gas-fired power plants to power it. Regulators approved those plans last August.
- But it quickly became apparent Meta would need a lot more power.
- In March, Entergy Louisiana announced another seven new plants for Meta.
- Regulators are still reviewing those plans under a fast-tracked consideration period, but all 10 lock Meta into a payment plan for 15 to 20 years to keep ratepayers from picking up the tab, says Public Service Commissioner Davante Lewis.
Driving the news: Now, however, Entergy Louisiana is looking to buy yet another power plant — and it's that endeavor that might end up costing ratepayers money in the short term, a new report says.
- PSC consultant Lane Sisung looked at Entergy's potential acquisition of the Cottonwood Generation Facility, a 21-year-old Texas power plant that the utility says it needs to help meet Louisiana's energy demands.
Friction point: Entergy Louisiana CEO Phillip May says the need for additional power was "well-established long before Meta expressed interest in Louisiana."
- While May says "no single customer is driving" Entergy's purchase of the Cottonwood power plant, Sisung's report contends that Entergy Louisiana needs more power just to bridge the gap between now and when the new, Meta-specific plants are up and running.
By the numbers: The 10 new power plants will have the capacity provide Meta around 7,500 megawatts of power, according to numbers Entergy's provided.
- In comparison, New Orleans drew about 1,200 megawatts on a peak summer day a couple years ago, a spokesperson says.
- In other words, Meta could use around six times more power than the city of New Orleans on one of the hottest days of the year.
What they're saying: Sisung's report "is inaccurate speculation given the facility will provide power to multiple Entergy customers and Entergy planned to acquire it before Meta decided to build in Louisiana," a Meta spokesperson says in a statement.
- "Meta pays its own way, both for the power and new infrastructure we use. Our agreement with Entergy is built to guarantee we pay those costs, not Louisianans."
Zoom in: Still, Sisung's report drummed up enough concern that Gov. Jeff Landry signed an executive order directing Louisiana Economic Development to create a "Ratepayer and Community Protection Framework" within the next three months for businesses looking to build data centers using state tax incentives.
What's next: Regulators have a long way to go before approving the Cottonwood purchase, Lewis says, with Entergy Louisiana still due to formally respond to Sisung's report within the coming weeks.
- "This is nowhere near done," says Lewis, who estimated it would take the commission another five or six months before a vote might happen.
Editor's note: This story has been updated with a comment from Meta.