Entergy Texas to acquire transmission assets to provide electricity to natural gas facilities for $10

Entergy Services, on behalf of Entergy Texas, will acquire certain limited transmission facilities from Centennial Pipeline for $10, according to an application filed with FERC on Dec. 2. 

Centennial Pipeline is a joint venture between Marathon Petroleum Co. and Texas Eastern Products Pipeline Co., (TEPPCO), and “has the ability to move 210,000 barrels per day of refined products,” according to the application.

The company’s pipeline originates at the TEPPCO tank farm in Beaumont, Texas, and extends into Bourbon, Ill.

“Pursuant to a deed, bill of sale and assignment of rights agreement, Entergy Texas will acquire from Centennial certain transmission-related assets located on the high side of Centennial’s John’s Gully substation, located near Beaumont, Texas, including 138 kV steel structures, 138 kV line switches, 138 kV rigid bus work, a metering panel, control cable, and a remote terminal unit,” Entergy said in the filing. “The assets will facilitate Entergy Texas’s provision of electric service to Centennial’s natural gas pipeline facilities.”

Entergy’s application requests an expedited, 21-day review of the transaction, as it does not constitute a merger nor pose a threat to rates, the company said.

“The transaction will not involve or affect any inputs to electricity production and will not cause Entergy Texas to gain the ability or incentive to affect prices or outputs in the downstream electricity markets or to discourage entry by new generators,” the company said.

In terms of wholesale rates, Entergy said that as the assets are high-voltage interconnection facilities that will facilitate Entergy Texas’s provision of retail electric service to Centennial, “their costs will not be reflected in Entergy Texas’s transmission service rates,” and the transaction, therefore, will not have any effect on rates for transmission service.

On Dec. 19, Entergy Texas will become a transmission-owning member of Midcontinent ISO (MISO), integrate its operations into MISO, and become a participant in the wholesale markets administered by the ISO pursuant to its open access transmission tariff. Upon Entergy Texas’s MISO integration, MISO will provide open access transmission service over the Entergy Texas transmission system under the MISO tariff. 

Entergy Services and Entergy Texas are subsidiaries of Entergy (NYSE:ETR). 

About Rosy Lum 525 Articles
Rosy Lum, Analyst for TransmissionHub, has been covering the U.S. energy industry since 2007. She began her career in energy journalism at SNL Financial, for which she established a New York news desk. She covered topics ranging from energy finance and renewable policies and incentives, to master limited partnerships and ETFs. Thereafter, she honed her energy and utility focus at the Financial Times' dealReporter, where she covered and broke oil and gas and utility mergers and acquisitions.