Nevadans of every political stripe have cheered NV Energy's plan to eject itself
from the coal business.
They envision unemployed Nevadans back to work, laboring under clear, blue skies; dismantling dirty coal plants and installing new solar panels; guaranteeing Nevada's energy independence for years to come.
The state's regulators, however, are hoping legislators will stop daydreaming and heed their warnings about Senate Bill 123, the utility's "NVision" plan.
In an effort to pass the bill, the utility has roped in both public and private participation from Gov. Brian Sandoval, U.S. Senate Majority Leader Harry Reid, the powerful Las Vegas casino industry, environmentalists and the renewable energy industry.
Lobbyists in Carson City say the bill has sparked a flurry of interest, and some have talked to potential new clients interested solely in this bill.
But it's not only a big money game in Carson City. All NV Energy customers -- you, your family, your business, your school -- would pay more because of this bill.
But it may be well worth it, says the utility.
The Sun interviewed NV Energy CEO Michael Yackira and listened to a recent hearing from the Public Utilities Commission of Nevada to hear both the pros and cons for consumers:
Cost is debatable
The utility says its plan will cost $494 million, or a 4 percent total increase over the next 20 years.
Echoing the Attorney General's consumer watchdog, the Public Utilities Commission questions that number.
"I have a feeling it's going to be a whole lot more," said Commissioner David Noble, noting that ratepayers have paid for about $3.5 billion worth of construction during the past decade and Nevada already has high energy rates. "One of the problems for getting commercial and industrial customers to come into this state are high rates. I don't see how SB123 addresses that problem."
The utility says that the 4 percent total growth over 20 years boils down to a 1.65 percent annual increase, which Yackira says is negligible because inflation will negate the increase.
Here's the bottom line: A rate impact model is only as good as its assumptions and variables. In other words, it's difficult -- if not impossible -- to say what you'll pay in rates 20 years from now if this bill passes.
Rates may decrease
The commission says that rates might actually go down if the Legislature doesn't pass this bill.
As Noble said, ratepayers have helped build $3.5 billion in generating capacity in the past decade and gas prices have declined.
If NVision and its baked-in power plant construction regimen doesn't pass, rates could decrease.
"Holding everything else constant, the next few rate cases may actually result in a rate decrease," said Anne-Marie Cuneo, commission staff.
Yackira said this could also hold true if NVision becomes law. He said the commission is "really pointing to natural gas prices."
"If those prices go down, our customers' rates will go down," he said.
Bottom line: Cheap natural gas is holding rates down now, coal is on its way out regardless of NVision, and the effect of the NVision plan won't really be felt until new construction brings new costs to ratepayers several years down the
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