Entergy estimates Hurricane Isaac damage at $500 million
(Reuters) - Entergy Corp said on Tuesday that damage from Hurricane Isaac would cost its utilities between $400 million and $500 million and would reduce power sales in the third quarter.
Hurricane Isaac struck the Louisiana coast with 80 mph winds on August 28. It lingered along the coastline for more than a day, leaving parts of Louisiana flooded as it crawled northward.
Entergy, which supplies electricity to 2.8 million customers in Arkansas, Louisiana, Mississippi and Texas, said Hurricane Isaac left more than 787,000 customers without power and damaged its power delivery infrastructure.
Isaac ranks as the fourth worst storm in Entergy's history in terms of power outages, behind Hurricane Katrina in 2005 with 1.1 million affected customers, Hurricane Gustav in 2008 with 964,000 affected customers and Hurricane Rita in 2005 with 800,000 customers.
"The storm caused significant outages in Louisiana and Mississippi, and later in Arkansas," Entergy said.
Distribution systems of the utilities had extensive damage, Entergy said. Preliminary estimates showed that Isaac had damaged or destroyed 4,500 poles and 2,000 transformers. The storm also knocked 95 transmission lines out of service along with 144 substations.
No damage has been identified at Entergy's fossil or nuclear power plants, but detailed assessments are continuing, the company said.
Entergy Louisiana's repair cost from Isaac is estimated at $240 million to $300 million, followed by Entergy Gulf States Louisiana at $70 million to $90 million; Entergy New Orleans at $50 million to $60 million; Entergy Mississippi at $30 million to $40 million, and Entergy Arkansas at $10 million, according to a company statement.
Entergy said its individual utilities were responsible for recovering storm-related repair costs and would pursue a variety of measures including accessing storm reserve funds, securitization or other alternative financing, insurance and rate recovery from customers.
New Orleans-based Entergy called on assistance from utilities in a dozen states to restore power to more than 92 percent of customers within five days. That compares to seven days it took to reach an 85 percent restoration level for Hurricane Ike in 2008, eight days for Gustav, 13 days after Rita and 16 days following Katrina, which left more than 122,000 customers incapable of taking electricity service.
Analysts expect Entergy to report third-quarter revenue of about $3.5 billion, according to Thomson Reuters I/B/E/S.
Entergy shares closed at $68.19 per share, down 14 cents, on Tuesday on the New York Stock Exchange.
(Reporting By Vishal Krishnan Menon in Bangalore and Eileen O'Grady in Houston; Editing by Sriraj Kalluvila)
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