Entergy Rebuilding from Hurricane Damage Entails Numerous Options and Actions

The damages to large portions of Entergy's transmission system by Hurricanes Katrina and Rita included thousands of miles of downed transmission lines and extensive damage from flooding.  The response to date has included numerous actions and proposals by the utility and governmental entities.

Within weeks of Hurricane Katrina's landfall, which led to flooding of vast areas of the city, Entergy New Orleans filed for Chapter 11 bankruptcy protection to further insulate its finances from those of other Entergy subsidiaries and to help manage the extensive losses caused by the hurricane.  

In Washington, Entergy vice president Curt Hébert advocated at a Congressional hearing for federal financial aid for Entergy New Orleans in order to prevent already over-burdened city residents from alone shouldering the high price of reconstructing the utility's shattered network.  The former FERC Chairman argued by analogy to the financial relief the government gave to airlines following their loss of business after the terrorist attacks on September 11, 2001. 

Department of Energy Secretary Samuel Bodman invoked his authority under the FPA to order CenterPoint Energy in Texas to temporarily restore power to Entergy Gulf States and thereby provide power to the latter's customers while it repairs its broken infrastructure. 

Most recently two municipal utilities in Louisiana and Mississippi that receive transmission service from Entergy offered to help fund reconstruction of Entergy's system in exchange for shared ownership interests in portions of the transmission network.  There is no indication yet whether Entergy is interested in such an offer.