Nevada regulator argues for states’ electricity rights

Thursday, July 29, 1999 | 11:22 a.m.

CARSON CITY -- State Consumer Advocate Fred Schmidt has told a House subcommittee in Washington D.C. that states should be free to set their own dates to permit open competition in the electric industry.

Schmidt also urged Congress to adopt policies in electric restructuring that benefit all users, not just big business.

The House Commerce Subcommittee on Energy and Power held a hearing last week on eight bills to open the electric industry to competition. Schmidt's comments were released through his office in Carson City.

"The truth is that we will have accomplished very little if the end result of our labors is to bring competitive benefits to only a small segment of the electricity market, while rendering basic service less affordable and less reliable for all other Americans," he said in his testimony.

Nevada's Legislature already adopted its electric restructuring law to begin next March 1. But Gov. Kenny Guinn will be able to delay it if he feels Nevada is not ready for competition.

The law imposed a lid on prices charged by Nevada Power Co., of Las Vegas and Sierra Pacific Power Co., of Reno for three years. They must remain at their present level, except for one more rate case to be filed by Nevada Power Co., this summer, for a 4-5 percent increase to recover higher fuel costs.

The two utilities will be able to lower rates. And consumers will be able to buy reduced-priced power from competitors during the three years.

Schmidt also asked the subcommittee to allow the states to decide whether, and to what extent, utilities should recover costs that are a result of retail competition. There also must be adequate consumer protections in any federal legislation, he said.

Schmidt, president of the National Association of State Utility Consumer Advocates, said the authority of the Federal Energy Regulatory Commission should be expanded in the case of merger of utilities to require a net benefit to consumers.

The commission must be allowed to review the reliability of service.

He said the federal agency also must have the authority power to stop market abuses where a company has a near monopoly.