Summary
Entergy Corporation (ETR) filed an 8-K on September 21, 2021, to disclose preliminary financial impacts from Hurricane Ida. The company estimates total restoration costs for damaged electrical facilities to be between $2.1 billion and $2.6 billion, with the majority of these costs impacting Entergy Louisiana and Entergy New Orleans. Additionally, Entergy anticipates a reduction in 2021 utility revenues, primarily from lost non-fuel revenue, estimated between $75 million and $85 million, largely concentrated in the same two operating companies. This revenue impact is expected to be partially offset by lower operational and maintenance expenses.
Key Highlights
- 1Preliminary Hurricane Ida restoration costs estimated at $2.1 billion to $2.6 billion.
- 2Entergy Louisiana and Entergy New Orleans are expected to bear the brunt of storm costs.
- 3Estimated loss in 2021 non-fuel utility revenue ranges from $75 million to $85 million.
- 4Financial impact of lost revenue may be partially mitigated by reduced operational and maintenance expenses.
- 5Entergy asserts sufficient liquidity of $4.2 billion as of August 31, 2021, to meet obligations.
- 6Company is actively pursuing regulatory and governmental avenues for storm cost recovery, including potential federal disaster funds.
- 7Collaborative efforts with regulators and state/federal officials are underway to minimize customer impact.
Frequently Asked Questions
Entergy estimates total restoration costs for damaged electrical facilities to be between $2.1 billion and $2.6 billion. The company also anticipates a reduction in 2021 utility revenues, primarily from lost non-fuel revenue, estimated between $75 million and $85 million.
Entergy has a history of working with regulators to recover storm costs and is exploring all available avenues. This includes seeking federal government assistance (such as Community Development Block Grant disaster recovery funds) and potentially securitization financing, with the aim of minimizing the impact on customers. Recovery is expected to occur through established regulatory and legal mechanisms.
Yes, Entergy stated that its liquidity was sufficient as of August 31, 2021, totaling $4.2 billion. This includes cash, available revolver capacity, and storm escrows, less commercial paper outstanding.
Entergy Louisiana and Entergy New Orleans are expected to incur the majority of the storm-related costs and revenue losses. Preliminary estimates for Entergy Louisiana are $2.0 billion to $2.4 billion in restoration costs, and for Entergy New Orleans, $120 million to $150 million. Similarly, lost revenue is primarily concentrated in these two service areas.