Recent media coverage has raised questions about Google’s long term energy agreement with Entergy Arkansas. Unfortunately, some of the reporting contains incomplete information that misrepresented both the scale of Google’s investment and the benefits delivered to Arkansas customers. We want to clearly and transparently explain the facts, so our communities have accurate information.
Entergy Arkansas took swift action to correct the misinformation.
Though a correction was made, recent reports dramatically understated Google’s investment due to a careless mathematical error. The calculation only accounted for 12 months of Google’s payments instead of the full 20-year term.
Using the published information — $443 million in advanced payments plus $83 million in minimum demand charges annually over 20 years — Google’s total cost coverage should have been reported as approximately $2.103 billion, not the $526 million stated.
Data centers
The large amounts of electricity data center facilities require has raised questions nationally about how that will impact the price and reliability of power for existing electric customers. The agreement with Google is expected to deliver $1.1 billion in benefits to customers and will result in utility rates that are lower than what they otherwise would be.
We enter into thoughtful data center customer service agreements that require them to pay the direct power costs to serve their facilities and provide added benefits for existing customers – this is our Fair Share Plus pledge that protects our more than 735,000 customers in Arkansas. Additionally, the Arkansas Public Service Commission have exercised oversight to ensure these projects do not negatively impact electric customers in Arkansas who are sharing the same power grid.
In addition, new large industrial customers help pick up a larger share of the grid maintenance improvement costs that residential and small business customers would otherwise have to bear alone.
These commitments align with our Fair Share Plus Pledge and the federal Ratepayer Protection Pledge, delivering the single largest benefit to all existing customers in Entergy Arkansas’s history.
Arkansas Cypress Solar and Battery
We plan to add 600 MW of solar power and 350 MW of battery storage from the new Arkansas Cypress facility in Jefferson County, which will provide clean, renewable power that lowers fuel charges on customer bills. Google will cover the full cost of the resource over the life of the contract, even though it will be an energy resource that serves all Entergy Arkansas customers across the service area.
Generating Arkansas Jobs Act
The Generating Arkansas Jobs Act allows us to responsibly build the infrastructure needed to support the state’s growth across all sectors, while keeping power affordable and reliable for all customers.
Customer privacy is a legal and ethical obligation.
You may also be wondering why we sought legal action to keep this information out of public view – because it is confidential customer information that was inadvertently shared outside of our control. If a news outlet was trying to publish your confidential data, just as was done here, we’d take action to safeguard your information. We take the protection of your information seriously, not just because we are bound by state law to do so, but because it’s the right thing to do.
The bottom line
The facts matter. Google’s agreement was structured to protect Entergy Arkansas customers, ensure Google pays its full cost of service and deliver significant benefits to customers across the state. We remain committed to transparency, protecting customer information and correcting misinformation when it occurs. As Arkansas continues to grow, Entergy Arkansas will continue working to ensure new investments benefit the communities we serve while keeping reliable, affordable power at the center of every decision.
Will all customers be paying for the Arkansas Cypress Solar power plant through the Generating Arkansas Jobs Act rider?
The Generating Arkansas Jobs Act allows us to responsibly build the infrastructure needed to support the state’s growth across all sectors, while keeping power affordable and reliable for all customers. Because Arkansas Cypress Solar serves the broader Entergy Arkansas system and must go through the normal regulatory process, it appears on customer bills like other generation projects, but Google’s cost responsibility ensures those expenses do not shift to other customers. Google will cover the full cost of the Arkansas Cypress Solar facility during the term of contract. This means that all other customers will receive the benefit of the clean energy produced by the facility without having to pay the investment cost needed to produce this energy.
Why are my electric bills higher now compared to previous years?
Costs across all sectors of the economy have gone up, and utilities are feeling the same pressures – including expenses such as fuel, transformers, equipment and the normal cost of doing business. Additionally, we have experienced some of the hottest temperatures on record, driving up summer utility usage more than ever before. And we continue having to replace aging infrastructure and invest in our grid to provide reliable service. Despite these inflationary pressures, we work hard to keep bills as low as possible, and our rates are still 22% below the national average.
How do data centers affect my electricity bills?
As they come online new large industrial customers help pick up a larger share of the grid maintenance improvement costs that residential and small business customers would otherwise have to bear. Data center customers are also paying the full cost to connect their facilities to our grid. There is no mark-up cost to customers on the service we provide, including any charges for purchasing fuel to power our plants.
Why is Entergy asking for a correction?
Though a correction was made, the information published contains a serious and careless mathematical error. The calculation accounts for only 12 months of payments by Google rather than the full twenty-year term of the agreement – a fact that was known to the paper but not included in its math. Using the figures published in the article – $443 million plus $83 million minimum annually over 20 years – the total would be approximately $2.103 billion, not the amount reported. That distinction is very significant. In fact, as demonstrated by the evidence submitted to the Arkansas Public Service Commission, Google is not only paying its cost to serve but is expected to deliver $1.1 billion in other benefits to Arkansas customers.
Why did Entergy Arkansas seek legal action?
We took this action because the information is confidential and competitively sensitive to our customer, and its release was accidental and beyond our control. If a news outlet was trying to publish your confidential data, just as was done here, we’d take action to safeguard your information. We take the protection of your information seriously, not just because we are bound by state law to do so, but because it’s the right thing to do.
The media are saying that Entergy isn’t being transparent and that the contract hasn’t been made public; is that true?
No, that is false. While Google’s electricity contract may be confidential to newspapers, it was provided in full and reviewed in detail by the public officials who regulate state utilities and protect the public interest and customers, including the Arkansas Public Service Commission and its staff and the Arkansas Attorney General.
Why can’t Entergy share Google’s contract agreement?
We cannot share the information because it is confidential and business sensitive, and sharing it could cause competitive business agreements in the future that bring jobs and other benefits to customers to not come to fruition. Customer privacy is very important to Entergy Arkansas, and maintaining that privacy is not only the right thing to do – it’s the law. The company protects all customer information – whether it involves a household, a local manufacturer, or a global company.
Why is Entergy working under a nondisclosure agreement (NDA)?
Entergy routinely participates in economic development project pursuits with local and state partners. It is common that an NDA is requested by an interested party during the early stages of scouting locations for a new business investment. If the project requires a non-standard contract, we work with our regulators in an open and transparent process that requires their ultimate approval in order for the project to move forward. As a power provider serving Arkansas, we are eager to help attract and support business investments that will grow jobs and incomes in the communities we serve.