Dive Brief:

• Entergy Louisiana and Entergy Gulf States Louisiana have asked the Louisiana Public Service Commission (PSC) for permission to merge into a single utility. The companies say the move is necessary to meet growing industrial demand for electricity. 
• If approved by the PSC, the merger would close in 2015 and require a $5 billion investment, the cost of which may raise rates for customers. Entergy officials say much of that cost could be offset by post-merger savings. 
• The two companies plan to invest more than $5 billion in grid upgrades and an increase of up to 1,600 megawatts of industrial load growth. 

Dive Insight:

Entergy's proposed merger comes as part of a nationwide trend of utility consolidation. In the past 20 years, there have been over 100 mergers or acquisitions in the industry.

Entergy officials say that although new investments could raise consumer costs, the merger is not meant as a rate-raising maneuver. They intend to make the move revenue-neutral through savings made possible by combining the companies. Entergy says the merger could produce up to $128 million in customer benefits over a decade, including $97 million in guaranteed savings during the first nine years. The process to determine the exact level of cost savings could take between 4 and 6 months. 

Both Entergy Louisiana and Entergy Gulf States Louisiana are subsidiaries of Entergy Corporation. The utilities offer electric service to more than one million customers in Louisiana. As a whole, Entergy Corp. provides electricity to 2.8 million customers in Arkansas, Louisiana, Mississippi, and Texas.