Palms misses deadline, seeks extension to exit Nevada Power

Kevin Rademacher

Monday, Sept. 15, 2003 | 10:51 a.m.

The Palms hotel-casino saw its window of opportunity to leave the Nevada Power grid and buy electricity on its own expire last week.

The hotel casino responded by filing a petition with the state Public Utilities Commission seeking to extend its 100-day window of opportunity, which ended last week.

The Palms is one of 12 large power users that received preliminary approval to leave the Nevada Power grid. Only four of those Nevada Power customers -- Station Casinos, the Monte Carlo, MGM MIRAGE and Fashion Show Mall -- have secured tentative contracts with alternative electric suppliers.

Those four customers could receive final approval to purchase their own power in a PUC hearing Wednesday. Last month, state regulators questioned the new contracts of those customers.

Regulators said the deals did not meet provisions that called for 30 percent of the summer peak power to come from generation facilities inside the local system.

That provision, Nevada Power has argued, is needed because the transmission system does not have the capacity to import enough electricity to serve those customers during peak summer months.

Exiting customers have argued that, with only two local plants selling wholesale electricity, the market does not have the generation capacity to meet that requirement.

Customers said that issue had been muddled by financial struggles of Mirant Americas, which owns the Apex Generating Station north of Las Vegas, and Allegheny Energy, which owned the contract to distribute power generated by the Black Hills Corp.'s Las Vegas Cogeneration plant in North Las Vegas.

Steve Boss, president of Nevada Energy Buyers Network which is representing Station Casinos and Fashion Show, said the recent bankruptcy filing of Mirant and a move by Black Hills Corp. to buy out the Allegheny contract adds renewed stability to the local market.

Regulators also questioned the lack of contract provisions that allow Nevada Power to buy 10 percent of the total contract amount at identical terms.