Company: EAI
Filing Date: 2025-08-01
Form Type: 10-Q
Source: 0000065984-25-000087
Chunk: 66

Company: ENTERGY ARKANSAS, LLC
Filing Date: 2025-08-01
Form: 10-Q
Item: Item 3
Chunk 66
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 Orleans has a credit facility in the amount of $25 million scheduled to expire in June 2027.  The credit facility includes fronting commitments for the issuance of letters of credit against $10 million of the borrowing capacity of the facility.  As of June 30, 2025, there were no cash borrowings and no letters of credit outstanding under the credit facility.  In addition, Entergy New Orleans is a party to an uncommitted letter of credit facility as a means to post collateral to support its obligations to MISO.  As of June 30, 2025, a $0.5 million letter of credit was outstanding under Entergy New Orleans’s uncommitted letter of credit facility.  See Note 4 to the financial statements herein for additional discussion of the credit facilities.

Hurricane Francine

In September 2024, Hurricane Francine caused damage to the areas served by Entergy New Orleans.  The storm resulted in widespread power outages, primarily due to damage to distribution infrastructure as a result of strong winds and heavy rain, and the loss of sales during the power outages.  In December 2024, in accordance with the terms of its storm recovery reserve escrow agreement, Entergy New Orleans transmitted to the City Council a notice of intent to withdraw up to $20 million in estimated storm costs resulting from Hurricane Francine from its storm recovery reserve escrow account, subject to the City Council’s certification of those costs.  In January 2025, the City Council authorized the withdrawal, and in February 2025, Entergy New Orleans withdrew $10.3 million from its storm recovery reserve escrow account.

State and Local Rate Regulation

See “MANAGEMENT’S FINANCIAL DISCUSSION AND ANALYSIS – State and Local Rate Regulation” in the Form 10-K for a discussion of state and local rate regulation.  The following is an update to that discussion.

Retail Rates

2025 Formula Rate Plan Filing

In April 2025, Entergy New Orleans submitted to the City Council its formula rate plan 2024 test year filing.  The 2024 evaluation report produced an electric earned return on equity of 10.98% compared to the authorized return on equity of 9.35%.  Without adjustments, this would result in a decrease in electric rates of $13.8 million.  The decrease in electric rates is driven by the realignment of regulatory liabilities into the formula from a separate rate mechanism, partially offset by the cost of known