‘Significant transfer of wealth’ feared

Wednesday, Jan. 30, 2002 | 9:23 a.m.

A majority of the Clark County Commission expressed concern about requests from Nevada Power Co. to raise electricity bills by as much as 25 percent, saying the rate hike would hurt people on fixed incomes.

Commissioners Dario Herrera, Myrna Williams, Erin Kenny and Yvonne Atkinson Gates spoke out during a public forum Tuesday in the commission chambers. Williams said the proposed increases would also force the county to reduce services it provides to residents.

"If granted, this will represent a significant transfer of wealth from the citizens of Southern Nevada to the power industry," Williams said.

The forum, similar to four others already conducted locally by the Public Utilities Commission of Nevada, was called to take input on the utility's request to recoup $922 million for energy already used. Nevada Power also is seeking an additional $22.9 million to cover administrative costs.

County government, which spends $16 million a year for electricity and could see its costs go up as much as $5 million, will express its concerns during formal hearings conducted by the Public Utilities Commission beginning Monday in Las Vegas. If the rate hike requests are approved, they will be reflected in consumer bills as early as April 1 and be spread out over the next three years.

"The impact on small businesses is equally severe," Herrera said. "Not only will small businesses have big increases, they will have to contend with customers who will have less money to spend."

Nevada Power spokesman Paul Heagen, who was repeatedly attacked at other public forums, endured more verbal punishment at the county hearing. He said the company shared the public's pain because it was victimized last year by having to endure rapidly escalating wholesale energy prices in order to meet peak electricity demands in Southern Nevada.

"We care deeply about the impact on the state," Heagen said. "This is not easy for us either."

Critics such as state Consumer Advocate Timothy Hay and former Public Service Commission (now PUC) Chairman Scott Craigie took shots at Nevada Power, however. Hay said Nevada Power paid at least $500 million more than it should have for energy from other power generators over the past two years. He also complained that consumer electricity bills in Southern Nevada have already risen 73 percent since July 2000.

"We think we have a compelling case that many of the company's decisions were imprudent and that a large amount of the dollars should be denied," Hay said of Nevada Power's rate requests. "They have shown no creativity in mitigating costs to consumers." Craigie, who represents business clients opposed to the proposed rate hikes, argued that Nevada Power did not deserve its requests in part because the utility had too much spare power in September. That month, he said, the utility sold 1.61 billion kilowatt hours of power to customers in other states, compared to 1.76 billion kilowatt hours used by Southern Nevadans.

He also complained that local consumers are already having to pay $415 million for rate hikes approved over the past two years and could face another $260 million hit next year.

"There's a piling-on effect here," Craigie said.

State Sen. Joe Neal, D-North Las Vegas, was among those who suggested that the county or the Southern Nevada Water Authority take over the power company.

The public anguish over the proposed rate hikes was reflected by residents such as Cliff Cruz of Las Vegas, who holds two jobs because his disabled wife is unable to work.

"We the working people and the elderly aren't going to take it any more," Cruz said to Heagen. "If you start shutting us down, where is your revenue going to come from?"