Nevada County Picayune and Gurdon Times Newspaper Archive

Rates going up

Prescotts City Council approved a resolution for the city to enter into a contract with the Arkansas Electric Cooperative Corporation (AECC).

The three-year deal was done in a special meeting Tuesday, Sept. 6. Basically, the rates will be 18 percent higher than they currently are. However, the contract does allow for fuel adjustment costs, so the 18 percent increase is not an exact amount.

Larry Stockton kicked the meeting off by telling the Council whats been done on the matter. He said he and Prescott Mayor Howard Taylor have been trying to get the contract presented for the last six weeks, but something has always come up to delay it. I thought wed have it after the August meeting, but Entergy threw a kink in it.

According to Stockton, Entergy said Prescott would have to take transmission through the open access tariff, but AECC is under the impression it can serve the city under the tariff. Stockton said the situation can go one of two ways. Prescott will apply for open tariff and AECC will file a complaint with the Public Service Commission (PSC), stating Prescott is not being treated fairly under the contract with Entergy.

I think Entergy is doing this on purpose, Stockton said, but maybe not.

He said Prescott could run out of time with the tariff situation and have to purchase electricity from Entergy for a while after Jan. 1, 2006. But, he added, if everything goes smoothly the paperwork could be filed by Sept. 15 and be ready by the first of the year so the city could make the transition from Entergy to AECC. I dont think this will happen. We could have to deal with Entergy a month or so and we dont know the costs involved.

Dave Wilson, legal counsel for AECC, was on hand for the meeting. He said Entergy is relocating its headquarters to Jackson, Miss., and while this is being done the company is entitled to put its business practices secondary.

But, he added, due to Hurricane Katrina, he expects things to go through easily. All of Entergys assets are through the Entergy Arkansas system, and there are legal remedies Prescott can seek if Entergy sits on its hands.

The contract between Prescott and the AECC is modeled after another municipal customers, Wilson said. The city of Augusta pays AECCs base rate plus 10 percent, which is what Prescott would be paying.

He added there could be delays from the Federal Energy Regulatory Commission (FERC) due to Katrina. If things drag on, Wilson said, well file the paperwork and make Entergy respond within 20 days.

AECC is an asset in the Entergy Arkansas grid and there are no new generators involved in this process, he said.

Stockton said the overall cost of power will stay the same, but Prescott may have to pay a transmission fee to Entergy.

Wilson didnt brighten the picture any when he told the Council there are things Entergy can do to delay things. He added this is the fourth such transaction hes done and there is some latitude in the case.

He informed the panel the wholesale rate for electricity is set by the PSC, adding AECC has a diversified supply of power and relies heavily on coal to produce its electricity.

Taylor told the Council local industries are on board with us with the increase.

The resolution was read and approved, granting the city the authority to enter into the three-year contract with AECC.