Government & Politics
 

Entergy fined $5 million, can move forward with new power plant

Michael Isaac Stein / The Lens

Gregory Manning leads a prayer after imploring the City Council to rescind their approval for Entergy’s power plant.

On Thursday, the New Orleans City Council passed a resolution to impose a $5 million fine on Entergy four months after an independent investigation concluded that the company “knew or should have known” that one if its subcontractors was paying actors to support its proposed power plant at council meetings.

The unanimous vote was a disappointment to the crowd of power plant opponents. In January, the council had introduced resolutions to rescind its prior March 2018 approval of the $211 million power plant and restart the hearing process. But today’s vote automatically withdraws those resolutions, extinguishing the hopes of opponents that wanted the council to reverse their decision.

The nearly three hours of public comment was dominated by power plant opponents, many of whom were residents of New Orleans East who said they didn’t want the pollution in their neighborhood. The comments not only criticized Entergy, but called into question the neutrality of some members of the council who have received money from Entergy. Some commenters asked them to recuse themselves from the vote.

“When we talk about immorality, we must talk about how sitting councilmembers have been in the pockets of Entergy at one time or another,” the Rev. Gregory Manning said.

In May 2018, the current City Council convened for a press conference to announce an independent investigation into Entergy’s role in the paid actor scheme. A reporter asked, “Are any of you receiving any kind of business deals or anything other than your regulatory business with Entergy? And have you received any campaign donations from them?”

Every council member said no except for Councilman Joseph Giarrusso, who was absent. But that wasn’t true. As it turns out, the majority of the council has either worked for Entergy at some point or received campaign donations for their political action committee, ENPAC Louisiana.

In July, The Lens reported that Councilwoman Cyndi Nguyen’s non-profit, the Vietnamese Initiatives in Economic Training, received at least $27,625 in grants and payments from Entergy between 2016 and 2018. Some of those payments were for work done on Entergy’s campaign to gain approval for the power plant.

According to state campaign finance records, Helena Moreno received $4,250 from ENPAC from 2010 to 2014, while she was in the Louisiana House of Representatives. Jared Brossett received $3,250 between 2009 and 2013, while he was in the state House of Representatives. And last week, Jay Banks revealed that from 2005 to 2008, he worked for Entergy as a government liaison.

Moreno and Brossett did not respond to requests for comment.

Criticism also extended to the city’s utility advisers — a group of consultants who are paid roughly $6 million to $7 million per year for their expertise on energy matters. The lead legal adviser, Clint Vince, as well as the firm providing technical expertise, Legend Consulting Group Limited, and a local law firm, Wilkerson and Associates, have maintained their contracts for nearly 30 years.

The majority of the council’s utility regulatory budget goes to paying these consultants, rather than to in-house staff. Months before Entergy submitted its application for a new power plant in 2016, those advisers had negotiated a settlement at the Federal Energy Regulatory Commission that committed Entergy New Orleans to use “diligent efforts” to develop a new plant in the city.

Opponents have complained that the influential advisers had made up their mind to recommend a new plant before the hearing process started and the public had a chance to provide input. And they say that the advisers are leading the council, rather than the other way around.

“I’ve been to every single meeting having to do with this power plant, and it’s all come down to the advisers,” said Ming Nguyen, the founder of VAYLA New Orleans, one of the organizations that has fought the plant for more than two years. “We’ve done this community-based process, but I don’t know if it ever mattered, because this decision was made before there was ever a hearing.”

The resolution passed on Thursday could direct a portion of the $5 million fine to the cash-strapped Sewerage and Water Board. Last week, the director of the board, Ghassan Korban, suggested three potential projects he could use the money for. All three projects address recent failures in the city’s water system.

The resolution also requires Entergy to file an application if it “becomes aware of the possible need” for expenditures on the plant that put the total cost above $211 million. The council will then have to review the spending and find it to be prudent before Entergy can recover those costs.

Councilman Jason Williams and Entergy New Orleans CEO David Ellis also informally agreed to several other conditions at the end of the meeting, including third party quarterly reports about emissions coming from the plant. He also said that a portion of the $5 million should go to economic development in eastern New Orleans.

In her closing statement, Moreno addressed the Entergy CEO.

“Mr. Ellis, I hope you see what turmoil this fake actor scandal has started,” she said.

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About Michael Isaac Stein

Michael Isaac Stein covers New Orleans' cultural economy and local government for The Lens. Before joining the staff, he freelanced for The Lens as well as The Intercept, CityLab, The New Republic, and Pacific Standard. He was recently awarded a fellowship from the Heinrich Boll Foundation, which he used to report on water scarcity, division, and colonialism in Cyprus.