Entergy Corporation (ETR) will lower the electricity rates effective April 1, 2011 at Entergy Mississippi following a unanimous voting from the state Public Service Commission (PSC). For an average residential customer using 1,000 kilowatt hours (kWh) per month rates will be $1.16 lower from April through June.
The state PSC agreed to lower the quarterly fuel-rate adjustment as per requests from Entergy. On an average, a typical customer’s bill will be $93.19 per month from April through June versus the current bill of $94.35.
The reduction mainly stems from a decline in the cost of natural gas, which is a standard electricity source for the utility.
Recently, in February 2011, the company had submitted its routine quarterly fuel adjustment to the staff of the Mississippi PSC to slightly lower the rates at Entergy Mississippi for a typical residential customer from $94.35 to $93.50 that was to be effective from April 1, 2011.
Entergy Mississippi uses a diverse mix of fuel to generate electricity at the lowest reasonable cost. Customers’ electric bills are made up of a combination of rates and usage. Those customers using more than the typical 1,000 kWh per month will see higher bills because of this usage, while those using less will see lower bills.
Entergy is well positioned through its geographically-diverse mix of regulated and merchant operations, and its strong balance sheet. The company is focused on maximizing its shareholder value through steady investment for rate base growth, as well as through its ongoing stock buyback program and incremental dividend. However, we remain cautious due to tepid growth in its competitive business on account of lukewarm power demand in the Northeast along with pending regulatory approvals and the fate of its Vermont Yankee plant. The company presently retains a short-term Zacks #3 Rank (Hold) that corresponds with our long-term Neutral recommendation on the stock.
Based in New Orleans, Entergy Corporation is an integrated energy company engaged primarily in electric power production and retail distribution operations. Entergy owns and operates power plants with approximately 30,000 megawatts of electric generating capacity, and it is the second-largest nuclear generator in the United States. Entergy Mississippi Inc., a subsidiary of Entergy Corporation, provides electricity to more than 435,000 customers in 45 counties. The company mainly competes with American Electric Power Company (AEP) and Southern Company (SO).
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