Entergy

 

Entergy is unique among corporate players in Louisiana in that it is a Fortune 500 company (one of only two in the state) headquartered in New Orleans, it serves a significant customer base in the state, and it is a major political player on both the local and state level.

Louisiana is the second poorest state in the country with a poverty rate around 20%. High levels of poverty and inequality exacerbated by natural crises like Hurricane Katrina in 2005, national economic crises like the debt crisis in 2008, and industry disasters like the BP Deepwater Horizon oil spill in 2010, have left the population vulnerable to the agenda of tax cuts in the name of job creation and economic recovery from the corporate class, which continues to thrive in the state.

The Basics

Entergy is an investor-owned utility, traded under the ticker symbol ETR on the New York Stock Exchange. Entergy’s stock has consistently gained value, growing from around $72 to $95 per share over from January 2017 to January 2021. 

Prominent Wall Street firms Vanguard, BlackRock, and State Street are Entergy’s top three shareholders, together holding 24% of the company. Truwealth Advisors LLC and the Louisiana State Employees Retirement System are the top Louisiana-based investors.

Entergy has three corporate entities headquartered in Louisiana and 2,200 employees statewide. The parent company Entergy Corporation is led by CEO Leo Denault, Entergy Louisiana is led by CEO Philip May, and Entergy New Orleans is led by CEO David Ellis who took over for longtime CEO Charles Rice following a major scandal in 2018. In April 2021 Entergy announced that Ellis will be replaced by Entergy Texas executive Deanna Rodriguez and take another position in the company in May. 

In 2019 Entergy CEO Leo Denault took home over $14 million in cash, stock, and other incentives. This generous package represented a $4 million increase over the previous year. This compensation package is over 280 times larger than the median household income in Louisiana and 106 times the median Entergy employee compensation.

In 2019 Entergy’s 11 board members took home an average of $305,000 in cash, stock, and other compensation.

Entergy’s Role in the Louisiana Power Structure

Entergy is a top-level corporate player in the Louisiana power structure – it has representatives on the most prominent chambers, business associations, philanthropic orgs, and even charter school advocacy groups across the state.

Entergy has representatives on the three largest and most active chambers of commerce in the state: the Baton Rouge Chamber of Commerce, One Acadiana (formerly the Greater Lafayette Chamber), and the New Orleans Chamber of Commerce. The agenda for these groups is generally focused on business-oriented goals including charter school expansion, opposition to raising the state minimum wage, protecting the pro-business tax code, investment in transportation infrastructure, and support for the energy industry generally.

 

Entergy also has representatives (either a CEO or other high-ranking executive) on the boards of the most prominent business associations including Greater New Orleans, Inc (GNO Inc), the Louisiana Association of Business and Industry (LABI), and Council for a Better Louisiana (CABL). The agenda for these groups largely center around right-to-work legislation, sales tax exemption for business utilities, workers’ compensation overhaul, and a corporate flat tax. 

Entergy executives even serve on the boards of some of Louisiana’s biggest charter networks including New Schools for Baton Rouge and KIPP New Orleans.

In addition to policy planning circles and advocacy groups, Entergy’s top executives sit on an array of philanthropic, cultural, and academic boards:

  • Leo Denault (CEO, NextEra): Jobs for American Graduates; Institute of Nuclear Power Operators
  • Rod West (President, Utilities Operations): Allstate Sugar Bowl; University of Notre Dame
  • Marcus V. Brown (EVP & General Counsel): Tulane Center for Energy Law; Louisiana State University Laborde Energy Law Center
  • Haley Fisackerly (CEO, Entergy MS): Mississippi State University College of Business; Bankfirst Financial Services; Woodward Hines Education Foundation; the Foundation for Mississippi History, Nature Conservancy
  • Laura R. Landreaux (CEO, Entergy AR): University of Arkansas at Little Rock College of Business; Arkansas Research Alliance; Arkansas Women in Power
  • Philip May (CEO, Entergy LA): The Louisiana Nature Conservancy; Teach for America of South Louisiana; City Year Baton Rouge; Second Harvest Food Bank. 
  • Sallie Rainer (CEO, Entergy TX): Interfaith of The Woodlands; Lone Star College Foundation; Greater Houston Women’s Chamber of Commerce; United Way of Greater Houston Montgomery County Regional Council; Texas A&M University Engineering Advisory Board

In addition to its socially and politically active executive team, Entergy has a charitable foundation registered in New Orleans, which distributed over $15 Million from 2015 to 2018 largely in the areas where its corporate subsidiaries operate. Notably two prominent charter school networks that have Entergy executives on their boards were among the six organizations to receive grants over $100,000. 

Top six 2018 recipients: 

  • United Way Worldwide: $1,286,655
  • Southern University System Foundation: $500,000
  • American Red Cross Southeast Louisiana: $250,000
  • Teach for America: $233,333
  • New Schools for Baton Rouge: $200,000
  • KIPP New Orleans: $125,000

The foundation’s 2018 990 filing also notes that it funded a few cultural events in 2018 including Jazz at Lincoln Center Inc and the State of Arkansas’ week of activities around the Martin Luther King Jr holiday.

How Entergy Moves its Agenda

Entergy is an active player in state politics wherever it operates. This is especially true in its home state of Louisiana where it has 21 active registered lobbyists to push its agenda in Baton Rouge. It is worth noting that industry lobbyists in Louisiana enjoy a unique level of influence due the state’s restrictions on legislative staff. Legislators are permitted a single staff person, meaning that lobbyists, who already have a high level of access, often have a direct line to lawmakers. This access has paid off handsomely for Entergy, which has been granted at least $425 million in tax breaks and subsidies by the Louisiana Legislature from 2008 to 2017.

Following this trend of access, Louisiana campaign finance law permits utilities like Entergy to donate directly to the state regulators – the commissioners of the Louisiana Public Services Commission – that oversee their operations. The significance of this access and potential for conflicts of interest cannot be overstated, as LPSC’s decisions are worth billions to the corporations they regulate. A 2013 report found that between 2009 and 2012 LPSC commissioners received two-thirds of their campaign donations from the industries they regulate, including utilities. In the most recent commissioner race in November 2020, Entergy donated around $50,000 to Eric Skrmetta, the winning incumbent for District 1. 

At the Federal level Entergy retains around 25 lobbyists and spent $2.5 million on lobbying in 2020. According to OpenSecrets, around 80% of Entergy’s lobbyists previously worked in government.

Like many other utilities Entergy is an across-the-aisle political donor at the federal level, leaning Republican but giving to both major parties. In 2020 Entergy’s PAC donated equal sums to the National Republican Senatorial and Congressional Committees and the Democratic Senatorial and Congressional Committees. However Entergy’s PAC is not a major federal-level political donor. The PAC donated just $364,500 in the 2020 cycle, up just slightly from the $358,000 it spent in the 2016 cycle. 

Entergy Greenwashing, Violations, and Scandals

  • In 2018 Entergy made headlines after it paid actors $60-200 each to attend New Orleans City Council meetings and pose as grassroots supporters of its proposed New Orleans East gas-fired power plant. The new plant was being opposed by a coalition of community groups however several representatives from nonprofit recipients of Entergy’s charitable giving also testified on behalf of the company. The revelation that the company used actors and the resulting scandal, lawsuit, and city council investigation prompted Entergy New Orleans CEO Charles Rice to step down from his position.

    Amidst the scandal two members of the New Orleans City Council – which has direct regulatory oversight of local utilities – admitted to previous ties to Entergy. One City Council member previously worked for the company while another took donations from the company while running a local non-profit. Even more members took campaign contributions from Entergy. No members recused themselves from the case and while the council fined Entergy $5 million, they ultimately voted to approve the New Orleans East plant.

  • Just one year after its paid actor scandal, Entergy New Orleans threatened to sue the New Orleans City Council if it adopted a proposed clean energy policy called the “resilient renewable portfolio standard,” which would require a certain percentage of the company’s portfolio be from renewable energy sources. Entergy said it would support the goal of net-zero carbon emissions as long as “the goal is not mandatory or does not carry any penalties for non-compliance.”
  • Having learned nothing from its New Orleans actor scandal, Entergy sent a former employee-turned-consultant undercover to pose as a stakeholder in a 2020 meeting held by the Mississippi Public Service Commission.
  • In February 2021 Entergy cut energy access across New Orleans during a winter cold snap. It was later revealed that Entergy had cut access to approximately three times more power than required by the regional grid operator. 26,000 customers in New Orleans were forced to endure cold temperatures without power, largely in Black and poorer communities. Entergy blamed the excessive cuts on computer glitches. 

The ensuing criticism resulted in yet another executive shake up at the company with Entergy New Orleans CEO David Ellis, who has been brought in to replace Charles Rice during a 2018 scandal, being replaced by an Entergy Texas executive.