At the Louisiana Public Service Commission’s request, Entergy has agreed to resume talks with Leucadia Energy on buying synthetic natural gas from the company’s proposed $2 billion Lake Charles Cogeneration plant. After two years of discussion, Entergy walked away from the deal in October. Leucadia today appealed to the PSC to intervene, but the move was tabled until the April meeting with a request the two parties attempt to renegotiate. “It’s better than we had before today,” says Leucadia attorney J. Kenton Parsons, adding the company’s 30-year contract was the deal-breaker, which could be a problem because it looked to Entergy as its primary customer.
Mike Twomey, vice president of utility strategy for Entergy services, says his company will reconsider a proposal if the terms match Leucadia’s public claims, which he says have differed drastically so far. “We think the proposals we’ve seen to now would put our customers at great risk,” says Twomey, who also expressed these concerns to the PSC. “We’re objecting to avoid a bad long-term economic deal.”
Leucadia Energy says it can save customers $400 million in utility costs over 30 years, but Twomey says he hasn’t seen that guaranteed in writing. Twomey also says their proposals have included an option that could roll over the contract in perpetuity.
In other business, the PSC decided to order Entergy Louisiana to suspend its plan for the Little Gypsy plant in St. Charles Parish. Entergy had planned on converting the generator from natural gas to petroleum coke, but questions have been raised on whether customers would benefit. Entergy has been asked to come back next month before the PSC to discuss the economic viability of continuing the Little Gypsy project.—Anna Thibodeaux