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Entergy, The Company Behind The Super Bowl Blackout, Has A Shady History

A tale of $1 billion in misused corporate subsidies sheds light on last night’s debacle.

Entergy, The Company Behind The Super Bowl Blackout, Has A Shady History

Like many New Orleans residents, my parents own a diesel generator, which they purchased after Hurricane Isaac last fall left them without power for several days. As the rest of the world is now well aware, following last night’s Super Bowl, it would be foolish for New Orleanians to rely solely on the city’s electric company, Entergy.

Entergy and its local subsidiaries have been the target of class action suits stretching back over a decade. In the suits, the company is accused of price-gouging and violation of anti-trust laws. After Katrina in 2005, the company declared bankruptcy and received hundreds of millions of dollars in federal funds, combined with 6 to 10% surcharges on customers’ bills, for a total of over a billion dollars in extra cash to rebuild and come back stronger. But a new class action filed after Hurricane Isaac last August alleges that they failed to use the money to prepare adequately for the next storm, and then failed to respond to the storm properly when it came, leaving 769,000 customers without power, many for over five days. To add insult to injury, during the years since Katrina, Entergy, the only Fortune 500 company headquartered in New Orleans, has been busy moving white-collar jobs out of the city.

Entergy is blaming the 34-minute Superbowl blackout last night on equipment maintained by the stadium staff. (The Superdome reopened in 2011 after a $320 million renovation and was renamed the “Mercedes-Benz Superdome.”) But pointing fingers won’t help. Until we figure out better ways to build resilient cities without corruption, more cities like New Orleans are going to measure infrastructure failures in lost investment, lost tourist dollars, and in public embarrassment.

[Image: AP/Gerald Herbert]

About the author

She’s the author of Generation Debt (Riverhead, 2006) and DIY U: Edupunks, Edupreneurs, and the Coming Transformation of Higher Education, (Chelsea Green, 2010). Her next book, The Test, about standardized testing, will be published by Public Affairs in 2015.