Nevada Power seeks fifth rate hike

Monday, Oct. 16, 2000 | 11:45 a.m.

CARSON CITY -- Gov. Kenny Guinn stopped the start of open competition in the electric industry in Nevada -- but he didn't halt the monthly increases of the two major power companies.

Nevada Power Co. on Friday submitted its fifth application to raise rates, this time by 1.4 percent, for its customers in Clark County. This will result in an extra $15.8 million in revenue for the company in a year. For the average homeowner who uses 1,100 kilowatt hours, the bill will rise $1.04 a month.

This brings the total increase to 9.8 percent in the last five months. This one becomes effective Dec. 1.

And Sierra Pacific Power Co., the sister utility to Nevada Power, announced it is going to boost rates by $7.7 million a year in Northern Nevada. The average bill for a homeowner who uses 650 kilowatts will go up 85 cents, the company said.

These increases, according to Sierra Pacific Resources Inc., the parent company of the two utilities, will cover higher fuel or purchased power costs. They will not boost the profits of the company, says Sierra.

These applications were submitted to the state Public Utilities Commission. In the past, the commission did a full-scale examination of the books of the utilities to determine their profits and expenses. But it performs a preliminary review now without an in-depth analysis in giving its approval.

But after six months, the utilities have to pay for an audit that will be submitted to the commission to show that the fuel cost increases were justified.

Under the "Global Settlement," the two utilities can only collect a percentage of their higher fuel costs.

The agreement was reached between the two utilities, the big casinos on the Las Vegas Strip, state Consumer Advocate Tim Hay and the staff of the utilities commission. It was approved by the commission on a 2-1 vote.

It called for deregulation to start Nov. 1 for the casinos and other big electric users in Southern Nevada. But Guinn delayed that.