Gulf States Utilities
Encyclopedia
Gulf States Utilities was an electric power
generation and distribution company headquartered in Beaumont, Texas
. The company was founded in 1911 as Eastern Texas Electric, a holding company for Stone & Webster
. On August 25, 1925, Gulf States Utilities Company was incorporated in the state of Texas
.
The company grew and in 1979 moved its headquarters into the Edison Plaza office tower, which is still the tallest building in Beaumont. Its older headquarters, the Liberty-Pearl building (Formerly the Hotel Beaumont from 1929 to 1955), which still houses a lot of its telecomm equipment including the microwave radio systems, is still the second tallest building in Beaumont. Also in the late 1970s, construction began on the River Bend Station
nuclear power plant
. Cost overruns on the nuclear plant, high interest rates of 24-30%, a CEO of GSU who wanted a "nuke plant in the company" and a downturn in the regional economy in the early to mid 1980s nearly drove GSU into bankruptcy
. In fact, trading of company stock was halted on the New York Stock Exchange
one day as it tumbled down over 75% and eventually stopped at less than $2 a share. Former chief financial officer, Joseph L. Donnelly (who bore the nickname "Orville Redenbacher
" because of his likeness to the popcorn king and always wearing a bowtie), has been credited with preventing the company from filing for Chapter 11 and was its CEO. (see link below)
GSU was absorbed by Entergy Corporation January 1, 1994 after first accepting a $19 per share offer from SWEPCO. Entergy's CEO at the time, Edwin Lupeburger, demanded another shot at buying GSU. The Entergy Board of Directors had a late night conference call and the next morning, tendered a $20 per share offer to GSU. GSU then had to pay SWEPCO a reported $10million to back out of the deal with them. At the time, GSU had 578,000 customers across southern Louisiana
and East Texas
. Edison Plaza was used by Entergy as its Texas headquarters. Joe Domino, a well-respected longtime employee who started as an engineer and later served as Sabine Station plant (near Bridge City) manager, is currently Entergy, Texas president. The River Bend Station continued to be a thorn in the side of its new owners due to lawsuits by the project's investors and fines levied by the Nuclear Regulatory Commission
over safety problems at the plant.
Gulf States Utilities is still a legally incorporated entity in the state of Texas. However, recently Entergy changed GSU's Texas name from Entergy Gulf States to Entergy Texas, Inc. and merged the GSU Louisiana service territory with its Entergy-Louisiana unit. Entergy Texas notified the Texas PUC that it would not be joining the Texas Electric Grid operated by ERCOT
and will stay regulated and part of the massive Eastern Interconnect (one of the two major power grids in the US besides Texas' own which covers 75% of the state and has only DC Direct Current
ties to other states). Only ONE time was the tie connection in Dayton, Texas between GSU/Entergy and the Texas grid (via CenterPoint Energy
) ever used; after Hurricane Ike to provide power to the water pumps along the north side of Lake Houston and other affected areas. This was done after Texas Governor Rick Perry ordered CenterPoint to request Entergy to close the tie.
Electric power
Electric power is the rate at which electric energy is transferred by an electric circuit. The SI unit of power is the watt.-Circuits:Electric power, like mechanical power, is represented by the letter P in electrical equations...
generation and distribution company headquartered in Beaumont, Texas
Beaumont, Texas
Beaumont is a city in and county seat of Jefferson County, Texas, United States, within the Beaumont–Port Arthur Metropolitan Statistical Area. The city's population was 118,296 at the 2010 census. With Port Arthur and Orange, it forms the Golden Triangle, a major industrial area on the...
. The company was founded in 1911 as Eastern Texas Electric, a holding company for Stone & Webster
Stone & Webster
Stone & Webster is an American engineering services company based in Stoughton, Massachusetts. Stone & Webster was founded as an electrical testing lab and consulting firm by electrical engineers Charles Stone and Edwin Webster in 1889. It was acquired by The Shaw Group in 2000. The company...
. On August 25, 1925, Gulf States Utilities Company was incorporated in the state of Texas
Texas
Texas is the second largest U.S. state by both area and population, and the largest state by area in the contiguous United States.The name, based on the Caddo word "Tejas" meaning "friends" or "allies", was applied by the Spanish to the Caddo themselves and to the region of their settlement in...
.
The company grew and in 1979 moved its headquarters into the Edison Plaza office tower, which is still the tallest building in Beaumont. Its older headquarters, the Liberty-Pearl building (Formerly the Hotel Beaumont from 1929 to 1955), which still houses a lot of its telecomm equipment including the microwave radio systems, is still the second tallest building in Beaumont. Also in the late 1970s, construction began on the River Bend Station
River Bend Nuclear Generating Station
River Bend Nuclear Generating Station is a nuclear power station on a site near St. Francisville, Louisiana, approximately north of Baton Rouge...
nuclear power plant
Nuclear power plant
A nuclear power plant is a thermal power station in which the heat source is one or more nuclear reactors. As in a conventional thermal power station the heat is used to generate steam which drives a steam turbine connected to a generator which produces electricity.Nuclear power plants are usually...
. Cost overruns on the nuclear plant, high interest rates of 24-30%, a CEO of GSU who wanted a "nuke plant in the company" and a downturn in the regional economy in the early to mid 1980s nearly drove GSU into bankruptcy
Bankruptcy
Bankruptcy is a legal status of an insolvent person or an organisation, that is, one that cannot repay the debts owed to creditors. In most jurisdictions bankruptcy is imposed by a court order, often initiated by the debtor....
. In fact, trading of company stock was halted on the New York Stock Exchange
New York Stock Exchange
The New York Stock Exchange is a stock exchange located at 11 Wall Street in Lower Manhattan, New York City, USA. It is by far the world's largest stock exchange by market capitalization of its listed companies at 13.39 trillion as of Dec 2010...
one day as it tumbled down over 75% and eventually stopped at less than $2 a share. Former chief financial officer, Joseph L. Donnelly (who bore the nickname "Orville Redenbacher
Orville Redenbacher
Orville Clarence Redenbacher was an American businessman most often associated with the brand of popcorn that bears his name.-Early life:...
" because of his likeness to the popcorn king and always wearing a bowtie), has been credited with preventing the company from filing for Chapter 11 and was its CEO. (see link below)
GSU was absorbed by Entergy Corporation January 1, 1994 after first accepting a $19 per share offer from SWEPCO. Entergy's CEO at the time, Edwin Lupeburger, demanded another shot at buying GSU. The Entergy Board of Directors had a late night conference call and the next morning, tendered a $20 per share offer to GSU. GSU then had to pay SWEPCO a reported $10million to back out of the deal with them. At the time, GSU had 578,000 customers across southern Louisiana
Louisiana
Louisiana is a state located in the southern region of the United States of America. Its capital is Baton Rouge and largest city is New Orleans. Louisiana is the only state in the U.S. with political subdivisions termed parishes, which are local governments equivalent to counties...
and East Texas
East Texas
East Texas is a distinct geographic and ecological area in the U.S. state of Texas.According to the Handbook of Texas, the East Texas area "may be separated from the rest of Texas roughly by a line extending from the Red River in north central Lamar County southwestward to east central Limestone...
. Edison Plaza was used by Entergy as its Texas headquarters. Joe Domino, a well-respected longtime employee who started as an engineer and later served as Sabine Station plant (near Bridge City) manager, is currently Entergy, Texas president. The River Bend Station continued to be a thorn in the side of its new owners due to lawsuits by the project's investors and fines levied by the Nuclear Regulatory Commission
Nuclear Regulatory Commission
The Nuclear Regulatory Commission is an independent agency of the United States government that was established by the Energy Reorganization Act of 1974 from the United States Atomic Energy Commission, and was first opened January 19, 1975...
over safety problems at the plant.
Gulf States Utilities is still a legally incorporated entity in the state of Texas. However, recently Entergy changed GSU's Texas name from Entergy Gulf States to Entergy Texas, Inc. and merged the GSU Louisiana service territory with its Entergy-Louisiana unit. Entergy Texas notified the Texas PUC that it would not be joining the Texas Electric Grid operated by ERCOT
ERCOT
The Electric Reliability Council of Texas formed in 1970, is one of eight Independent System Operators in North America, and is the successor to the Texas Interconnected System...
and will stay regulated and part of the massive Eastern Interconnect (one of the two major power grids in the US besides Texas' own which covers 75% of the state and has only DC Direct Current
Direct current
Direct current is the unidirectional flow of electric charge. Direct current is produced by such sources as batteries, thermocouples, solar cells, and commutator-type electric machines of the dynamo type. Direct current may flow in a conductor such as a wire, but can also flow through...
ties to other states). Only ONE time was the tie connection in Dayton, Texas between GSU/Entergy and the Texas grid (via CenterPoint Energy
CenterPoint Energy
CenterPoint Energy is a Fortune 500 electric and natural gas utility serving several markets in the U.S. states of Arkansas, Louisiana, Minnesota, Mississippi, Oklahoma, and Texas. It was formerly known as Reliant Energy , NorAm Energy, Houston Industries, and HL&P...
) ever used; after Hurricane Ike to provide power to the water pumps along the north side of Lake Houston and other affected areas. This was done after Texas Governor Rick Perry ordered CenterPoint to request Entergy to close the tie.