Sierra Pacific to auction off 8 power plants

Monday, March 6, 2000 | 9:34 a.m.

Sierra Pacific Resources has started the process to auction off its power plants, but doesn't expect to complete the sales until early next year.

The plants belong to the utility holding company's two wholly owned subsidiaries, Reno-based Sierra Pacific Power Co. and Las Vegas-based Nevada Power Co.

The Valmy, Fort Churchill, Tracy and Pinon Pines plants will be sold in northern Nevada, while the Clark Station, Sunrise/Sun-Peak, Reid Gardner and Harry Allen plants will be sold in southern Nevada.

The plants have a book value of about $1 billion, but some experts said the companies probably would get substantially more.

"These plants are valuable assets with great profit potential," Jack Byrom, Sierra Pacific's director of strategic business development, said in a statement.

"They will provide their new owners with a substantial regional presence in the fastest-growing utility market in the nation."

The buyers also will have interconnections to major energy markets in California and the Great Basin, he said.

The holding company agreed to sell the power plants as a condition of approval for the merger of Sierra Pacific with Nevada Power.

Regulators believe the sale will make it easier for competitors to thrive after Nevada ends the monopolies of Sierra Pacific and Nevada Power.

Sierra Pacific will retain its transmission lines and function as an electrical transmission and distribution company.

In a related development, Gov. Kenny Guinn will hold a 1 p.m. Tuesday meeting in his office with some groups involved in efforts to deregulate the power industry.

Utility executives, regulators, and mining and casino officials are expected to discuss Guinn's postponement of competition. They may select a new deadline for deregulation.

The power plant auction also stems from Sierra Pacific's planned $3 billion acquisition of Portland General Electric in Oregon. Sierra Pacific intends to use the proceeds for the buyout.