SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the
Securities Exchange Act of 1934
Date of Report (Date earliest event reported) December 29, 1994
Commission Registrant, State of Incorporation, I.R.S. Employer
File Number Address and Telephone Number Identification No.
1-11299 ENTERGY CORPORATION 13-5550175
(a Delaware corporation)
639 Loyola Avenue
New Orleans, Louisiana 70112
Telephone (504) 529-5262
0-5807 NEW ORLEANS PUBLIC SERVICE INC. 72-0273040
(a Louisiana corporation)
639 Loyola Avenue
New Orleans, Louisiana 70112
Telephone (504) 529-5262
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Form 8-K Page 1
December 29, 1994
Item 5. Other Materially Important Events
Entergy Corporation and New Orleans Public Service Inc.
In a settlement with the New Orleans City Council (the
"Council") that was approved on December 29, 1994, New Orleans
Public Service Inc. ("NOPSI"), a wholly-owned subsidiary of
Entergy Corporation ("Entergy"), agreed to reduce electric and
gas rates and issue credits and refunds to customers.
Effective January 1, 1995, NOPSI will implement a $31.8
million permanent reduction in base electric rates and a $3.1
million reduction in base gas rates. These adjustments resolved
issues associated with NOPSI's return on equity exceeding 13.76%
for the 12 months ended September 30, 1994.
Under a 1991 settlement agreement with the Council,
NOPSI recovers from its retail customers its allocable share of
certain costs related to the Grand Gulf Unit 1. NOPSI's base
rates to recover those costs were derived from estimates of those
costs made at that time. Any overrecovery of costs is required
to be returned to customers. Grand Gulf Unit 1 has experienced
lower operating costs than previously estimated, and NOPSI has
agreed to reduce its base rates in two steps to more accurately
the match current costs related to Grand Gulf Unit 1. Effective
January 1, 1995, NOPSI will implement a $10 million permanent
reduction in base electric rates to reflect the reduced costs
related to Grand Gulf Unit 1, followed by an additional $4.4
million rate reduction on October 31, 1995. These Grand Gulf
rate reductions, which are expected to be largely offset by lower
operating costs, may reduce NOPSI's after-tax net income by
approximately $1.4 million per year commencing November 1, 1995.
The next scheduled Grand Gulf phase-in rate increase in the
amount of $4.4 million will not be affected by the settlement
agreement, and will occur on October 31, 1995.
In addition, the current settlement requires NOPSI to
credit its customers $25 million over a 21-month period beginning
January 1, 1995, in order to resolve disputes with the Council
regarding the interpretation of the 1991 settlement agreement.
NOPSI recorded a $15.4 million net-of-tax reserve associated with
the credit in the fourth quarter of 1994.
The current settlement also requires NOPSI to refund,
in December 1994, $13.3 million of credits previously scheduled
to be made to customers during the period January 1995 through
July 1995. These credits were associated with a July 7, 1994
Council resolution that ordered a $24.95 million rate reduction
based on NOPSI's overearnings during the test year
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Form 8-K Page 2
December 29, 1994
ended September 30, 1993. Accordingly, NOPSI recorded an $8
million net-of-tax charge in the fourth quarter of 1994.
The settlement also requires NOPSI to refund $9.3
million of overcollections associated with Grand Gulf operating
costs, and $10.5 million of refunds associated with the
settlement by System Energy Resources, Inc. ("System Energy") of
a Federal Energy Regulatory Commission tax audit. The settlement
of the tax audit by System Energy required refunds to be passed
on to NOPSI as well as other Entergy subsidiaries and then on to
customers. These refunds have no effect on current period net
income.
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SIGNATURE
Pursuant to the requirements of the Securities Exchange
Act 1934, the registrant has duly caused this report to be signed
on its behalf by the undersigned hereunto duly authorized.
Entergy Corporation
By: /s/ Lee W. Randall
Lee W. Randall
Vice President and Chief
Accounting Officer
New Orleans Public Service Inc.
By: /s/ Lee W. Randall
Lee W. Randall
Vice President, Chief
Accounting Officer
and Assistant Secretary
Dated: January 9, 1995
