Lawsuits fly over Nevada Power rates, deregulation ruling

Tuesday, April 18, 2000 | 9:58 a.m.

CARSON CITY -- Nevada Power Co. on Monday asked a state District Court in Carson City for an injunction to allow it to immediately hike its rates by $110 million to its 567,000 customers in Clark County.

At the same time, the state Public Utilities Commission petitioned a federal court in Reno to dismiss Sierra Pacific Resources' suit seeking to invalidate the 1999 law opening up the electric market to competition.

The two filings are part of the court battles being waged between the state and Sierra Pacific Resources, the parent company of Nevada Power.

No hearing has been set in either case.

The commission last month ordered Nevada Power to reduce its rates by $9 million to $10 million a year, rather than raising them $110 million as requested by the Las Vegas utility.

Nevada Power, in its motion Monday, asked the District Court to stop the commission's proposed lower rates from going into effect.

Doug Ponn, vice president of regulatory and governmental affairs for Nevada Power, said the proposed rate increase would not mean higher profits for the utilities. The money would offset higher costs of fuel and other items, he said.

The extra $110 million, Ponn said, was needed to ensure the financial health of the company.

"Prices we pay for fuel to operate our power plants are affected by the same factors that have driven up gasoline prices," Ponn said.

"Motorists are paying more at the gas pump to drive their cars, and utilities are paying more for natural gas to run their electric generators."

Even with the increase, Nevada Power's electric rates would still be the lowest in the Pacific Southwest, Ponn said.

Meanwhile the utilities commission said Sierra Pacific's suit challenging the deregulation law should be dismissed for several reasons, among them that the PUC and its members are immune from lawsuits and the federal court lacks jurisdiction.

The electric market could have been open to competition on March 1, but Gov. Kenny Guinn said the state was not ready for deregulation.