Tuesday, June 29, 2004 | 10:45 a.m.
CARSON CITY -- Relief is on the way for natural gas and electric users in Southern Nevada. The state has received $16.4 million as the first installment of a $52 million antitrust settlement with El Paso Corp., says Tim Hay, director of the state Consumer Affairs Bureau.
Hay said Monday that two-thirds of the first payment will be distributed to residential and small business customers. His office must work with Nevada Power Co. and Southwest Gas Corp. on refunding the money, which will probably come in the form of a credit on the August or September bill, he said. The amount of the credit hasn't been determined.
El Paso could stretch the remaining payments out over 15 years but Hay expects it to speed up the payments because of rising interest rates.
The Houston-based El Paso Corp. admitted no wrongdoing but agreed to a $1.6 billion settlement with Western States including Nevada, California, Oregon and Washington. The $52 million for Nevada is the largest antitrust amount the state has ever received.
The remaining one-third of the settlement will go to the big industrial companies in Henderson and the major casinos that are designated as "non-core customers." They must apply to the consumer bureau for their refunds.
The settlement was reached more than one year ago but payment has been delayed because there are "so many entities" involved, Hay said. The escrow company received court permission last week to release $300 million of the $1.6 billion settlement.
The states complained that El Paso and other companies manipulated natural gas prices during the Western energy crisis.
The energy companies, according to the suit, got together in 1996 in a motel in Phoenix and started developing a plan to restrict supply expansion in the West, said Hay.
And that action led to a rise in natural gas prices. Natural gas is not only used by residential and business customers but also by Nevada Power to fuel generators.
Hay said shortly after the Arizona meeting, El Paso abandoned plans to build more pipelines. The settlement, he said, includes an agreement that this conduct will not occur again. "Congestion on the El Paso natural gas system will be relieved," he said.
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