Dive Brief:

• Entergy estimates the cost of repairing the damage from Ida to transmission towers and other infrastructure will total between $2.1 billion and $2.5 billion, Andrew Marsh, the utility's executive vice president and chief financial officer, told analysts Wednesday on a third quarter earnings call.
• CEO Leo Denault said the New Orleans-based utility is working with Louisiana Gov. John Bel Edwards to help secure $1.2 billion to $1.3 billion in federal money to help offset the cost of repairs racked up by storms in 2020 as well as Ida, which hit the Gulf Coast on Aug. 29, leaving more than a million people without power.
• Entergy also took a $65 million revenue hit from Hurricane Ida, double the impact of Hurricane Laura last year, Marsh said.

Dive Insight:

Despite the revenue blow from Ida, Entergy remains on track to meet its financial commitments, Denault told analysts, attributing this to what he called the utility's efforts to develop a "more resilient" business model.

Overall, the company has spent $10 billion over the past five years upgrading its transmission and distribution systems to protect against storm damage.

Wind damage, in turn, occurred most almost exclusively to older structures built to prior standards, company officials said Wednesday.

As a result, the utility was able to stick with plans to raise the dividend paid to its investors by 6%, Denault said.

"This happened on the schedule we previously communicated and represents another commitment met," the Entergy CEO and chairman said. "We have developed a more resilient business."

Entergy got the power back for roughly half of its customers in a "little over a week," while New Orleans and Baton Rouge had the lights back on by day ten, Denault said.

Entergy deployed a "restoration force" of 27,000, made up of employees, contractors and mutual assistance crews from other utilities from 41 different states.

By the end of week three, Entergy had restored power to 98% of its customers hit by the storm.

"The quarter was heavily impacted by Hurricane Ida, which made landfall as a strong category four hurricane bringing powerful destructive winds across New Orleans, Baton Rouge and beyond," Denault said. "Our coastal communities were particularly hard hit by both strong winds and storm surge."

Meanwhile, Entergy plans to discuss with regulators the possibility of securitizing the $2 billion-plus cost of repairing the damage to its power lines and infrastructure from Ida. Marsh said the $2.5 billion estimate was recently by $100 million

Faced with larger than expected storm damage costs, a number of utilities have turned to the bond market in recent years.

"We will work with our regulators to seek securitization of Ida storm costs, which is a proven and low-cost means of recovery," Denault said.