New company approved to buy Entergy New Orleans’ gas business after yearlong battle

New Orleans residents will soon have a new gas provider, after the City Council approved Entergy’s sale of its gas business to a private equity firm.

Delta Utilities, an affiliate of Bernhard Capital Partners, will take over Entergy’s gas business likely by the second half of next year as part of the deal announced more than a year ago. The City Council voted 5-0 on Thursday to give final signoff on the deal.

The sale comes after a yearlong battle over climate targets, economic development and bill increases. Entergy and Delta have argued the sale will boost jobs and free up capital for Entergy to spend on its aging electric grid. But opponents, including Mayor LaToya Cantrell’s Office of Resilience and Sustainability, raised concerns that the deal would hamper clean energy goals and heap more costs on already-burdened customers.

The City Council approved an amended version of the deal that caps certain transition costs and requires Entergy to share some proceeds with ratepayers in a bid to lessen the expected bill increases for customers. Gas customers are expected to see a roughly $3 a month increase on bills after a two-year freeze ends.

A string of opponents spoke out against the deal again Thursday, saying Delta will squeeze ratepayers for profit and that the deal will hamper the city’s goals to wean off fossil fuels.

“The people have spoken loud and clear and in so many ways in spite of your efforts to ignore them,” said Jack “Big Okra” Sweeney, a progressive organizer.

With the deal approved, Bernhard Capital Partners, a private equity firm founded by former Shaw Group executives including former state Democratic Party chair Jim Bernhard, will become the leading gas utility in Louisiana. The Louisiana Public Service Commission, which regulates most utilities outside of New Orleans, has already signed off on Bernhard’s acquisition of the gas businesses of Entergy Louisiana and CenterPoint Energy.

The council’s utilities committee signed off on the deal earlier this week despite a chorus of opponents who argued the deal would hurt ratepayers in the long term and cement fossil fuels in the city’s energy mix. Some local business development leaders testified in support, saying the deal would bring jobs with Delta’s New Orleans-based headquarters.