County may battle power hike

Adrienne Packer

Thursday, Nov. 29, 2001 | 9:38 a.m.

Clark County commissioners on Tuesday will consider submitting a request to intervene with Nevada Power Co.'s rate hike proposal, a move that would allow county staff members to be involved in upcoming hearings.

Nevada Power's record-breaking request for a $929 million rate increase would add $5 million a year to the county's utility bill and would also affect residents, some of whom are already reeling financially in the aftermath of the Sept. 11 attacks.

"This would give us standing to be part of the hearings in the rate case," Clark County Commission Chairman Dario Herrera said.

"Because we are such a big customer and because we represent so many constituents, it would seem logical for us to be recognized as an intervener."

Clark County Finance Director George Stevens said that to cover the increase in utility bills, the county would take $2.5 million from the general fund and the other half from McCarran International Airport's budget.

Stevens said it is not unusual for a government to intervene when the financial effects are so significant.

"Any major power user can do that," Stevens said.

The County Commission has not adopted an official position on Nevada Power's request, which must be formally submitted for consideration by the Public Utilities Commission by Dec. 1.

Herrera said by allowing county administrators to sit in on discussions between the PUC and Nevada Power, commissioners will be better informed of the utility's needs when the board takes a position.

Although Nevada Power officials have blamed the needed hike on increasing fuel costs, Herrera said that on the surface it appears the power company wants ratepayers to make up for poor decisions made in the past.

"It seems as though initially Nevada Power is attempting to recover their costs for past mismanagement of the company," Herrera said. "They want to finance the recovery of those costs on the backs of our constituents."

Timothy Hay, a state consumer advocate, believes Clark County and the cities within should intervene to protect ratepayers.

Hay said he intends to testify during the rate hearings that Nevada Power has not been financially prudent with its acquisition attempts and has relied too heavily on ratepayers to make up for losses.

"Their business practices haven't been prudent, and they shouldn't get recovery for the entire amount," Hay said. "The basic bottom line is they have been bailed out by ratepayers to the tune of hundreds of millions of dollars, and now they're asking for close to a billion.

"It's time for the company to not always come to ratepayers for a bailout."

Hay said the first installment of the rate increase would go into effect April 1, just before the weather heats up. He fears residents who have been laid off or are working fewer hours because of a lagging Las Vegas economy will suffer most.

Herrera said the county shares the fear. If the PUC approves the increase, Herrera said he will suggest using the $2 million the county expects to gain in franchise fees to help ease the pain for low-income residents.

During the past legislative session a bill was passed to create a fund to assist low-income Nevadans with their power bills. The bill, authored by Assemblyman David Goldwater, D-Las Vegas, added 0.0575 cents to the tax rate the utility pays for every dollar of gross revenue.

Herrera said the county wouldn't duplicate Goldwater's efforts; it would simply complement the bill already in place.

"It's important for the commission to consider all of its options so we can be helpful to constituents who could be facing historically high rate increases," Herrera said.