DELAY THENOPSVOTE UNTIL WE EXAMINE ALL OPTIONS– ver. Feb 19

Just stoppingNOPSis not the right goalANDfor James Gray and most of the Council it is LIKELY TO BE "a bridge too far".Thus, we are forced to focus uponNOPSnow... but we do not need to DEFEATNOPS, instead, we should instead focus upon DELAYING THENOPSVOTE while we require the Utility Committee to examine all optionswithin Utility Committee meetings:and while we're at it, refocus the council's utility committee on their jobs: to openly

1) Review theNOPSdocket's evidence and its implications. (Appendix A is the executive summary of one such brief.)

2) Receive evidence from Marcie Edwards, interim executive director of the Sewerage and Water Board [S&WB] to answer: “What are S&WB’s greatest problems that have anything to do with services ENO can/should provide, e.g., electricity capacity, at the right frequency, reliability and energy efficiency investments on or off S&WB’s fiscal plant?”[31]

3)Receive testimony from the two Demand-Side-Management Potential-Study Contractors:

a) JanVrins, i.e.,ENO'shired gun,Navigant,[32] and b) Optima Energy andACEEE, i.e., the Council's hired gun. 45

4) Receive more testimony fromNRRI.[33], 48, 51, 58

5) Examine the full economic costs and alternatives of all competing ways to increaseNOLA'saccess to Renewable Energy [RE] using the metrics of:

a)ENO'sreturn on investment in each case[34],[35]

b) Capital-cost using ratepayer funds vs harnessing private investment[36]

c) Speed of acquisition.[37]

d) Benefits associated with increasing Distribution System Reliability.[38]

e) Benefits of battery investments incentedat a rate just below the cost thatENOwould pay for the same services.[39]

f) Benefits these batteries installed by customers to increase reliability and buy negatively priced electricity from IOWA every night and letENOmake a profit (albeit a much smaller ROI) on these customer-sited battery purchases…[40]

g) Turn on, Community Solar, as was recommended in 2007 in the New Orleans Energy Policy Task Force report.[41],[42]

h) Turn on our nascent and growing RE & Microgrid industry and will stimulate 50 x as many jobs.[43],[44]

6) Explain that the LONG-ACCEPTED COUNCIL RESOLUTION (of 2008) thatENOshall do anIRPevery three years REQUIRES that theNOPSissue MUST BE DECIDED within the 2018IRPprocess and ifNOPSfails the 2018IRPtest, it can be brought up again 3 years later. The Council should accept its own decision from 2008 to not make new generation upgrades outside of THE INDUSTRY-STANDARD proven process, and, recognize theENOmade its arguments forNOPSwithin the 2015IRPcycle and failed.

7) Explain that all previousENOIRP'shave been defective in all these ways:

a) There was no 3rdparty, independentDSMpotential study... previously work was done by contractors working forENO.[45]

b) Until January 2017, the Utility Committee was led to believe, that the scope and details of aDSMwas an output of anIRPinstead of an input.[46]

c)IRPwork can be effectively done or grossly effected by an auction — but this has never been tried.[47]

d)Rate design, e.g., Time of Use rates, can be more effective — but this has never been tried.[48]

e) All ofENO'sIRPshave ignoredENOsystem and customerreliabilityboth: in the choice ofENOinvestments: whether in generation, transmission or distribution AND in the choice ofENO'scustomer's investments.[49]

8) The Scope ofDSMwork has also been grossly deficient:

a)None of theDSMwork done has ever addressed the needs ofENO'slargest customer, the S&WB, and this has materially contributed to the S&WB's lack of reliability and suppressed energy efficiency with the results of: greater losses in floods, longer outages during freezes, greater S&WBbills and no synergy between S&WB and ENO’s services and costs.31,[50]

b) Until last year, no previousDSMwork included Demand Response.

c) However, as Tom Stanton pointed out in December,DSMPotential should not be limited to investments on the Demand Side of the Meter; it should include Distribution Resource Planning and investments there.[51]

d)DSMpotential should not be limited to consequences generated by investments by ratepayers via a utility-administered program, namely "utility-managed".[52]

e)DSMpotential should not be limited to spending with a SPENDING CAP of a few tens of millions / year but instead allowed to be wide open to include ALL COST-EFFECTIVE INVESTMENTS.This was the assertion of ChrisNemewhen he testified at the September 2017 meeting... and through this approachDSMcan confidently attain more than a 3% drop in kWh consumption as has been proven in NH, MA, and VT.[53]

f)DSMshould not be narrowly focused upon decreasing energy consumption but instead, BECAUSE aDSM'smain purpose is to inform a qualityIRPprocess, its primary goal should be upon decreasing peak demand measured inKWs, notkWh’s.[54]

g) Nevertheless, Energy Smart is decreasing demand at $0.50/W and if allowed to continue along its current trajectory using the current ES administrator, ES will decrease peak demand by more than 200 MW by 2023... and all such expenditures have a NET-PRESENT VALUE, negative cost to ratepayers.[55]

h) Deemed savings is clearly not working. Investments must shift to performance-based compensation for ratepayer-funded investments. Consider the grossly high, energy bills from January.44, 55

i) 2018 is FINALLY THE YEAR of the RATE CASE... and the Utility Committee has just voted unanimously in favor of smart meters. But, there is no pilot program that will fully use smart meters coupled with Time of Use [TOU] rates and/orCLEPto examine the potential to ameliorate the need for new generation that way... a way that has an international track record of reducing peak demand by 15%. namely more than 2/3 the peak demand avoided than theNOPSgeneration option can provide just withTOU. But TOU has much less potential thanCLEPto affect peak demand and customer-side investments that are onlyincentedby performance.TOU has a projected net cost of less than $0.30 / W compared to the $1/W which isNOPS'sprice tag.48,49,[56]

j) Pursuit of Reliability is not separable from pursuit of energy efficiency nor pursuit of decreased need for peaking generation capacity.

9) How does a vote forNOPSfavorably comport with these decisions by the Council and other, very important issues?

a) The Council's decision to only vaguely support the Mayor's Climate Action Plan — which, instead, if fully implemented will make NOLA 100% renewable by 2030.[57]

b) The Utility Committee's unanimous decision to pursue deployment of SmartMeters. 48,49,[58]

c) The ongoing and apparently increasing: more than 2500 outages a year.[59]

d) Lack of good much less very, very good reliability needed for NOLA' s criticalinfrastructure.[60]

e) Limited funding sources that ratepayers = tax payers = S&WBcustomers can financially bear?[61]

10) Refuting assertions byENO.

a)NOPSis likely to flood in a major hurricane.[62]

b) Even ifNOPSdoes not flood, the Distribution system will fail with a 100%probability.[63]

c) During the winter HARD FREEZE,NOPSwould have provided less than 1/2 of one percent additional power to NOLA becauseENOmust share all assets withMISO.[64]

d)NOPSis no help whatsoever to the S&WB; and never will be.ENO'shas undermined S&WB'sreliability and refused to contribute to its efficiency.[65]

e) IfNOPSis so good, letENObuild it as a Merchant Plant and take all the risks and benefits. ENO does not need Council approval to build NOPS to use for pure wholesale electricity sales.[66]

f) IfENOwill not take the Deal in e) perhaps it will accept a new regulatory contract, like that used in CA and only require its customers to pay for investments that are deemed used and useful... and any time it is no longer deemed used or useful,ENOwill have to eat the residual costs of investments.[67]

11) The timing of the NOPS vote isbad.

a) It is not fair to the Council-elect to have to deal with a mess that is not in their control... That council will have to set rates AFTERNOPSis accepted as afait-accompli, instead of making the decision within the Rate Case.

b) The current regulatory climate is grossly hampered byboth MardiGrasand the Winter Olympics that will jeopardize public attention on this issue as well as the time, current Council members can devote to it.

c) The New Orleans Coalition has just passed a resolution opposed to NOPS only available a two days before the vote... andNOChas endorsed the election campaign of every member of the current council and the council and mayor-elect.

d) No newspaper has run any in-depth treatments of the issue, nor reported on the findings of theNOPSdocket.

e) The public meetings held byENOdid not allow public comments to the contrary of their goals via a process that could be called DUE PROCESS...this did not serve the public interest; it only promulgated confusion.

f) the major trade industries have been confused by this process.

g) the Council is confused because they do not understand the complexity of the issue.

h) the last meeting of the utility committee stifled discussion onNOPSinstead of promoted it.[68]

Thus, wethink we should be working together to write up a prototype, FIRST DRAFT, of a

Motion to Delay a Vote onNOPS until a Specific Set of Issues are Settled.

The plan, as I see it, will include all the preceding (or a more salient, easier to appreciate and concise subset) written into the WHEREAS SECTION.

Principal author: Myron Katz, PhD, Building Science Innovators, 302 Walnut Street, NOLA, 70118, dated 19 Feb 2018.

Cosigners are:

Appendix A “… the Public Interest Intervenors respectfully submit this Post-Hearing Brief.”

Pursuant to the City Council of New Orleans Resolution R-17-426, the Alliance forAffordable Energy, Deep South Center for Environmental Justice, 350 – New Orleans, andSierra Club (collectively, “the Public Interest Intervenors”) respectfully submit this Post-HearingBrief. Based on the evidence and record in this proceeding, as set forth below, the Public InterestIntervenors request the City Council of New Orleans deny the Application of Entergy NewOrleans, Inc. (“ENO” or the “Company”) for Approval to Construct New Orleans Power Stationand Request for Cost Recovery and Timely Relief. Signed by Michael Brown, attorney, Waltzer, Wiygul & Garside, LLC, January 22, 2018

INTRODUCTION

Today, the City Council of New Orleans (“Council”) stands at a crossroads. One path, thepath proposed by Entergy New Orleans (“ENO” or “the Company”), is old, worn, and well pastits usefulness. Essentially, ENO wants New Orleans to remain mired in the past, to build yetanother fossil-fueled power plant that is unnecessary, will cost New Orleans ratepayers millionsof dollars, will subject residents to increased levels of air pollution, and contribute to climatechange.

The other path is recognition of the future of clean, sustainable energy generation and theharmful impacts of fossil-fuel generation. It is a path already selected by regulated utilities, statesand local governments across this country. Utilities are abandoning reliance on fossil fuels andadopting a mix of new technologies. Technologies such as solar and battery storage, combinedwith innovative energy efficiency programs and demand response are replacing proposed fossil-fueled power plants across the country. This is the path that the Council should choose.

More important, ENO has utterly failed to prove that building either a 226 MW CT plantor a 128 MW RICE unit is in the public interest. As the intervenors and the Advisors havedemonstrated, ENO has failed to establish that it will have a capacity need for either size gas-fired plant in the next ten years. Evidence actually supports the conclusion that ENO will notneed additional capacity for fifteen years. Moreover, ENO’s proposed gas-fired plant would putNew Orleans customers at unnecessary financial risk by requiring residents and businesses topay for generation that they do not need and will also place at risk future investment in eitherrenewable generation or demand-side management.

Similarly, while ENO created a reliability need by its decision to close Michoud Units 2and 3, that need can be met far more cheaply and more quickly by alternatives to the gas-firedplant that ENO steadfastly refused to fully consider. The evidence demonstrates that gas-firedgeneration is not needed to meet reliability standards, and that neither NOPS alternative wouldmitigate reliability concerns in any way in the next two years. In fact, ENO’s own data show thattransmission upgrades, in combination with energy efficiency measures and solar generation,could resolve reliability violations more cheaply than either gas-fired plant. ENO’s reliabilityarguments offer no support for approval of either gas-fired plant.Furthermore, the gas-fired plants are not the least-cost alternatives and, in fact, wouldcost ratepayers more than transmission and solar-powered solutions. As the Advisor witnessesconclude, upgrading New Orleans’ transmission lines and installing utility-scale solar, instead ofconstructing a gas-fired plant, would be the “economically preferred alternative.” Moreover,ENO failed to adequately assess the impacts of constructing a gas-fired plant on theenvironment. These impacts include increased air pollution, subsidence or flooding. Similarly,ENO failed to adequately assess the impacts on the predominantly African American andVietnamese American communities living near the Michoud site.

Thus, the Council should find that 1) there is no need for the capacity; 2) reliabilityconcerns can be addressed through less costly and more timely means; and 3) neither proposal isin the public interest. Based on these finding, the Council should reject both ENO applications.The Council also should institute a transmission reliability proceeding to fully examine all thealternatives available to resolve the reliability concerns created by the deactivation of Michoudunits 2 & 3.

SUMMARY OF ARGUMENT

In this docket, Entergy New Orleans, LLC (“ENO” or “the Company”) is asking the CityCouncil to approve its application to build a gas-fired power plant in New Orleans East. ENO’slatest, supplemental and amending application represents the culmination of nearly four years inwhich ENO has sought to convince the City Council that some sort of gas plant in New OrleansEast is the Council’s only option. In this effort, ENO has provided the Council with a series ofshifting and illusory claims about the need for a gas plant.In this docket proceeding, ENO has proposed varying sizes of a proposed gas plant andpresented different reasons to justify a new gas plant. ENO has switched its justification for anew gas plant from an emphasis on capacity need1 to an emphasis on reliability need.2 Thedriving purpose of these inconsistencies is ENO’s desire to build, and add to its rate base, a$200-plus million-dollar, gas-fired facility. ENO’s desire for a new gas plant has resulted in itsfailure to seriously evaluate any alternative other than a gas plant to meet the City’s capacity orreliability needs.

ENO’s plan to close Michoud Units 2 and 3 and build a new gas plant apparently hadbeen set in motion by 2014.3 At this time, ENO had been conducting transmission systemassessments, which suggested the need for system upgrades—such as transmission line upgradesor adding generation— in the event of Michoud Units 2 and 3 are decommissioned.4 Apparently,these assessments were done internally. ENO witness Charles Long revealed that “all along,”ENO concluded that it would not make the transmission line upgrades, even though they wouldresolve the reliability problems associated with decommissioning Michoud Units 2 and 3, but,instead ENO chose to add new generation.5ENO’s decision to decommission Michoud Units 2 and 3 was made unilaterally. ENOnever sought Council approval prior to closing Michoud Units 2 and 3, or informed the Councilor its Advisors of any near-term, serious reliability risks attending the closure.6

ENO’s reliability concerns would have been news to the public and to the City Council and its Advisors, who, apparently, never learned that the closure of the old Michoud units posed an immediate reliability risk, as modeled in the NERC, P-6 contingency, until at the earliest late 2016, and only then after reviewing studies produced in this docket.7A study conducted by MISO in 2014 found that, based on existing planned transmissionupgrades, there were no reliability constraints and no voltage reliability concerns posed byENO’s plan to close Michoud Units 2 and 3.8 It is worth noting that MISO did not specify thatENO should replace the shuttered units and did not recommend designating the closing units a“System Support Resource.”9

In 2015 and 2016, ENO began to lay the groundwork to convince the City Council that ithad little option but to build a gas plant at Michoud. In August 2015, ENO entered into asettlement agreement, later approved by the City Council on the recommendation of its Advisors.The overall purpose of the settlement agreement was to terminate the System Agreementgoverning the relationship between ENO and other ENO affiliates. The settlement agreementalso included a term that essentially committed ENO to putting forward the second application itmade in this docket, containing a combustion turbine and a 128 MW gas option:

As part of this commitment, ENO will fully evaluate Michoud or Paterson, along with any other appropriate sites in the City of New Orleans, as the potential site for a combustion turbine (“CT”) or other peaking unit to be owned by ENO, or by a third party with an agreed-to PPA to ENO.10