The Louisiana Public Service Commission has approved a plan that allows Entergy Louisiana (ELL) and Entergy Gulf States – Louisiana (EGS-LA) to recover the costs the companies incurred during the massive restoration efforts that returned power to a combined one million customers after hurricanes Katrina and Rita in 2005.

Under the plan, ELL will recover $545 million of its storm restoration costs and EGS-LA will recover $187 million. The plan also approved a future storm reserve of $152 million for ELL and $87 million for EGS-LA to offset the impact of future restoration efforts from major storms.

The LPSC also issued an order authorizing the companies to securitize the storm costs, which will significantly reduce the effect of storm restoration on customers by spreading the costs out over several years and allowing the costs to be financed at a lower interest rate than that offered by traditional utility financing. Customers could potentially save from $100 to $200 million dollars in interest costs.

Under the plan, residential customers of Entergy Louisiana, LLC will pay an additional $1.99 per 1000 kWh of electricity. Entergy Gulf States-Louisiana residential customers will pay an additional $1.66 per 1000 kWh.

An alternative securitization structure approved by the Louisiana legislature in 2007 may provide additional savings. Entergy Louisiana is reviewing the alternative structure with the LPSC and will pursue it if additional savings can be realized.