Articles

    Entergy sees fast growth for electrification, renewable projects

    Originally posted by Matthew Bandyk | February 20, 2020 | Utility Dive | Original Article

    Dive Brief:

    Entergy Corp. plans to ramp up work in projects to reduce emissions in its utilities’ service territories – such as electrifying processes that currently run on fossil fuels – as a key focus of its growth strategy, Entergy Chairman and CEO Leo Denault said in the company’s fourth quarter 2019 earnings call on Feb. 19.

    Entergy’s adjusted earnings were $137 million, or $.0.68/share, for the quarter and nearly $1.1 billion, or $5.40/share, for 2019, continuing to improve on negative earnings last reported in 2016 in large part due to losses at merchant nuclear plants the company has since been selling off.

    With the retirement of the Indian Point nuclear plant in New York expected in the second quarter of this year, Entergy is “well on its way” to a complete exit from its Entergy Wholesale Commodities business segment, Denault said.

    Dive Insight:

    Denault’s comments heavily emphasized efforts to reduce emissions both from Entergy’s generation fleet and for customers of its utilities in Louisiana, Arkansas, Mississippi and Texas.

    “Customer solutions could be the fastest-growing part” of Entergy’s business, Denault said in response to questions from analysts.

    Those solutions include projects to encourage electrification among customers. Entergy has a program called eTech that promotes electric motors to replace equipment that runs on fuels and electric vehicle infrastructure.

    “Across all of our footprint we see a significant amount of opportunity in the electrification space,” Denault said.

    On-site renewable energy is also within the scope of these customer solutions. Entergy is engaging with large industrial customers to build rooftop solar arrays, according to Denault.

    The company will pursue more green tariffs that allow customers to purchase renewable energy, he said. These tariffs often provide additional revenue for Entergy to develop its own renewable projects. For example, last year Entergy Arkansas offered a tariff in which customers can subscribe to blocks of energy that represent the output from planned solar projects.

    Entergy’s company-wide generation mix for 2019 was 28% nuclear, 27% newer natural gas-fired combined-cycle and combustion turbine facilities, 24% purchased energy, 13% legacy natural gas plants, 6% coal-fired plants and 2% renewables, according to the company’s earnings presentation.

    That mix is poised to change, however, as Entergy closes nuclear plants like Indian Point and also retires coal facilities, while building more natural gas and renewables.

    Entergy has 400 MW of renewable capacity currently in operation, with another 200 MW in various stages of development, Denault said. In addition, the company completed construction of a 980-MW gas-fired combined-cycle plant in Louisiana and acquired an 810-MW gas-fired combined-cycle plant in Mississippi in 2019.

    Analysis of coal retirement dates is ongoing and earlier closure is “on the table,” Denault said in response to an analyst question about whether the falling costs of renewable energy would lead to earlier coal plant retirements.