By Wesley Muller | Louisiana Illuminator
Gov. Jeff Landry has called on state regulators to not let utility companies “take advantage” of ratepayers after reports surfaced last week that Entergy Louisiana customers could see higher bills if the company buys a Texas power plant to meet the needs of Meta’s Hyperion data center.
In a social media post, the governor said Entergy promised him it would not pass any costs onto ratepayers by taking Meta on as a new client. Meta, the parent company of Facebook and Instagram, is building a $28 billion artificial intelligence data center in Northeast Louisiana, and Entergy has a contract to supply the electricity.
To power the data center, Entergy is building new natural gas and solar power plants. In public statements and official filings with the Louisiana Public Service Commission, the utility company has promised that none of those costs will fall upon its regular ratepayers.
But a June 5 report from consultant Lane Sisung, one of the PSC’s long trusted advisers, questions that promise. In it, Sisung argues the data center has caused a projected power shortfall Entergy is proposing to fill through the purchase of a power plant at an “unreasonable” cost burden for ratepayers.
If regulators approve the purchase, it will cost the average Entergy Louisiana ratepayer an extra $8-13 per month, according to Sisung’s report.
“The PSC should not allow anyone to take advantage of power markets at the expense of our ratepayers,” the governor wrote in response to a Times-Picayune article on the matter.
The commission approved Entergy’s power deal with Meta last year in a fast-tracked vetting process that drew widespread public opposition. Critics have questioned Meta’s financing for its Louisiana data center and whether the new gas plants Entergy is building will become a burden to ratepayers far into the future if Meta decides not to renew its power contract after its 15-year term ends.
Sisung’s report flags an entirely separate filing from Entergy that the Public Service Commission hired him to review. The filing is a request from the utility company to purchase an existing gas power plant in Newton County, Texas, just across the state line from Calcasieu Parish. If regulators approve the deal, it would have a more immediate cost impact on ratepayers, Sisung wrote.
Phillip May, the company’s CEO, disagreed with the assessment in a news release Monday, saying the utility’s power needs are due mostly to other large industrial projects, including steel and petrochemical facilities that will soon come online.
“No single customer is driving this acquisition,” May wrote. “This facility is the best for all Louisiana customers.”
Sisung disagrees with that framing, arguing that a more thorough analysis shows Entergy’s shortfall is “predominantly attributable” to Meta’s power needs.
A bigger red flag, according to Sisung, lies in the terms of the deal. The 22-year-old Cottonwood plant, interconnected with Louisiana’s power grid, is currently owned by Atlas Holdings. Atlas, whose Pelican Power subsidiary owns three other plants in Louisiana, bought the plant from Cleco in 2024 as part of a larger package of 14 facilities for a grand total of $600 million. Entergy has tentatively agreed to purchase Cottonwood for $1.4 billion and would need to invest an additional $300 million to bring the power plant up to date, according to the utility’s estimates.
The deal arose through an unsolicited offer from Atlas, so it lacks the competitive bidding features of the usual proposal process, Sisung’s report states.
Sisung wrote that the $1.8 billion price tag far exceeds inflation and reflects a “scarcity premium” for an aging facility that has experienced catastrophic turbine failures and requires “substantial rehabilitation.” The high price tag and other increasing costs of electricity generation, he argues, are a direct result of Meta’s load requirements.
“In my opinion … the amounts being proposed to be paid by Louisiana customers for acquisition of benefits raise serious concerns,” he wrote.
Entergy has not yet filed a response to Sisung’s analysis and is expected to do so within the next 30 days.
The Public Service Commission seldom votes against the advice of its consultants, and this particular matter so far appears to have drawn some bipartisan alignment among its three Republican and two Democratic members.
“He’s our expert, I trust him, and he’s calling it like he sees it,” Commissioner J.P. Coussan, R-Lafayette, said in a text message. “I also think it’s fair to wait to listen to the utility’s explanation and justification before coming to an ultimate conclusion.”
Commissioner Davante Lewis, D-Baton Rouge, who cast the lone vote last year against Entergy’s proposal to provide Meta power, said Sisung’s report substantiates some of the concerns he and other critics have had about the data center agreement.
The governor’s public opinion on the situation could shore up GOP opposition to the deal, though he has ample time to change his mind. The Public Service Commission’s next meeting is Aug. 12.