Louisiana Industries Push for Energy Independence Amid Soaring Utility Costs

As electricity prices continue to rise across the country, a group of major companies operating in Louisiana is advocating for a shift in how industrial energy is sourced—hoping to generate or purchase their own power instead of relying solely on traditional utilities.

A key driver of this movement is a projected 90% increase in electricity rates for customers of Entergy Louisiana between 2018 and 2030. Critics, including the nonprofit Alliance for Affordable Energy, say this dramatic rise reflects a broader trend of escalating energy costs nationwide—fueled by aging infrastructure, growing demand from data centers, and weather-related damage intensified by climate change.

“This kind of increase is alarming and unsustainable,” said Logan Atkinson Burke, the organization’s executive director. “Louisiana is facing national issues at a faster and more severe pace, and residents aren't being adequately protected.”

This problem isn’t unique to Louisiana. Over the past five years, Oregon’s electricity rates have climbed by 50%, while 13 Mid-Atlantic states are bracing for a 10% hike this year. In Florida, a $9 billion rate increase request from the state’s largest utility could boost bills by 22%, according to environmental watchdog Food and Water Watch.

A federal study also recently highlighted that the expansion of liquefied natural gas (LNG) export terminals is driving up the cost of natural gas—used to generate over 40% of U.S. electricity—which is expected to add $122 annually to the average household electric bill.

Given these trends, some experts are calling for a reevaluation of how electricity is produced and paid for. Joshua Basseches, a Tulane University professor specializing in environmental policy, said the current system can’t keep up with rising demands and costs. “We need new models that allow for more flexibility and competition in the energy market,” he said.

Louisiana’s industries, which consume more than 40% of the state’s electricity, are seeking permission to generate or procure their own power, bypassing Entergy’s monopoly model. These companies also cite the need for renewable energy sources, which Entergy currently provides in very limited amounts.

According to the U.S. Energy Information Administration, Louisiana ranks near the bottom for renewable energy generation, with just 3.2% of its electricity coming from solar, wind, or hydro.

“We think there’s a better way to meet our energy needs—one that’s more cost-effective and beneficial for all customers,” said Randy Young, an attorney for the Large Energy Users Group (LEUG), which includes major corporations like Dow, ExxonMobil, and Monsanto. “Letting us handle some of our own generation could reduce the need for Entergy to build new infrastructure.”

Entergy Louisiana has recently received approval for several rate increases, including new monthly charges for grid upgrades and hurricane damage recovery. One recent project, a new transmission line to support a steel plant, will add approximately $1.50 to monthly bills for residential users.

These are just a few of the 17 capital projects currently under review by the Louisiana Public Service Commission, with projected costs contributing to the expected 90% base rate increase. Entergy disputes that projection, calling it an exaggerated effort to justify the LEUG’s proposal.

According to Entergy, if large industries are allowed to self-generate, it could shift significant costs to small businesses and homeowners. “Our rates cover system-wide expenses like generation, transmission, and distribution,” said spokesperson Brandon Scardigli. He also noted that Entergy maintains some of the lowest industrial rates in the country and does not rely heavily on coal.

LEUG has long pushed for better access to clean energy. In 2019, the group urged regulators to let industrial companies independently acquire renewable energy or sell excess power generated at their own facilities. Many of these businesses face environmental mandates from their parent companies or clients and need to increase their renewable energy usage.

While Entergy has since been authorized to secure 3,000 megawatts of renewable capacity—including 1,500 MW of solar power to help support a proposed Meta data center—renewables still make up only a small part of the utility’s energy mix.

“The utility keeps saying it supports renewables, but where is it?” Burke questioned, noting that Entergy continues investing in natural gas plants rather than accelerating renewable development.

Even though regulators recently allowed industrial users to negotiate directly with renewable providers, no deals have been finalized—mainly because Entergy remains involved as an intermediary.

After years of study, a long-awaited Public Service Commission report was released in December 2024 regarding whether industrial users should be allowed to sell or trade surplus energy. The report deferred any final recommendations, prompting frustration from LEUG and renewed calls for action.

Rather than waiting, the group has now proposed to develop 1,500 MW of solar power and enable 2,000 MW of co-generated power to be traded or sold—an initiative they say would reduce reliance on Entergy’s costly projects.

If regulators reject this path, LEUG warns that the state will be left with few options beyond continued rate hikes and more capital spending by Entergy.

The commission is scheduled to consider Entergy’s motion to end the broader investigation at its meeting on April 16 in Many, Louisiana.

“We can’t afford to continue down this path,” Burke said. “We’re at a crossroads, and the commission has to weigh every possible solution.”

Ari Peskoe, who leads the Electricity Law Initiative at Harvard, agrees that change is needed. “There’s no easy fix,” he said. “But introducing more competition into power markets could be a step in the right direction.”