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Published Wednesday, June 24, 2009 | 12:18 p.m.
Updated Wednesday, June 24, 2009 | 3:16 p.m.
Sun archives
Southern Nevadans will see their monthly electricity bills increase an average of $10.29 per month over the course of a year following an order adopted by the Public Utilities Commission at a meeting Wednesday morning.
That's a slight increase from the proposal in a draft order issued last week from one of the commissioners.
In the final order, the PUC is allowing the utility NV Energy to increase its revenues $221 million based on the company's recent capital investments. That's 73 percent of the additional $305 million NV Energy had asked to earn from ratepayers. It translates into a residential rate increase of 12.4 percent for the portion of the bill that's based on the company's capital investments. NV Energy had asked for a 16.7 percent residential rate increase for those investments.
But after factoring in the decline in fuel costs, ratepayers will see their bills rise 6.9 percent. Natural gas costs have come down rapidly since a sharp rise last summer.
Normally, the fuel and the capital cost rates are determined in separate processes. Commissioner Sam Thompson decided to collapse them into one order so ratepayers don't become alarmed and think their bills will rise more than they really will.
He and Commissioner Rebecca Wagner voted in favor of the order Wednesday.
A third commissioner, Jo Ann Kelly, recused herself from the case due to a conflict of interest.
Wagner and Thompson explained that in making their determination, they are stuck in a tricky dance. They must protect ratepayers during what Thompson called "the worst economic climate Southern Nevada has ever had". But they also are instructed to maintain a strong financial position for the company so it doesn't have its credit ratings downgraded, which would make it harder to find financing for new projects.
Seated next to Wagner at a podium in a hearing room at the NV Energy offices before a small audience made up of utility executives, PUC staff members, representatives from the attorney general's Bureau for Consumer Protection office and others, Thompson said he understands the burden on families that the rate increase presents. But, he said, he also had to factor in a fair return for the company's investors. Residential ratepayers, he said, "are at or near their ability to absorb rate increases, against the economic backdrop in this state. We have to be cognizant of that. I have to balance those interests against the need to have a healthy and financially fit utility to provide services to the citizens of Nevada."
Thompson initially had determined that NV Energy should receive a 10.4 percent return on its capital investments. But Wagner countered that a 10.5 percent return would look better to Wall Street. The company is currently allowed to earn back 10.7 percent on investment and had asked for an 11 percent return.
Despite previously stating that ratepayers could not handle any additional increases, Thompson eagerly agreed with Wagner's assessment. The impact of the higher rate of return would be minor on each individual household, Thompson reasoned.
For the company, the difference is $3.7 million more in revenues.
Thompson designed the residential increase to come in phases, with the first portion in effect in July, and the second portion kicking in in January, after the costly summer months are over.
In the next rate hearing in a couple years, the company will request to receive profits back from the $85 million that it will lose from that phased-in approach.
The rate increase for commercial subscribers was not released Wednesday. It is less steep than the residential increase because the PUC has been trying for many years to narrow the gap between electricity rates for households and those for businesses.
Some call it a "subsidy" of residential electricity rates from businesses, and whether it really exists is a matter of some debate. Others say it's even more dramatic than previously believed. Thompson said after the hearing that he was ordering a study to sort that out.
The final order followed weeks of hearings that Wagner said was unlike anything she's ever seen before.
She's been nervous about this case since it was first filed, she said, "but the abundance of evidence in the record made my job a lot easier."
Terrific, they've not even passed the new CAP and TRADE (TAX) sham yet. Better get get all the tax increases out early before anyone notices.
NV Energy rate increase gets commission's OK:
Of course it was rubber stamped, just like every NV Energy rater increase request is.
I guess that they needed more money to fund all those TV commercials. No wait, they say in a tiny disclaimer that these ads are not paid for by subscribers. Well then WHO pays for them, the tooth fairy, or maybe the electricity pixie? Like we have a choice as to where we get our power. I don't see any trucks from Acme Electric laying new power lines, do you? Hey commissioners, you getting a percentage . If NV Energy needs this big a tax write off then maybe they really don't need a rate increase. How about it LV Sun, the Ensign story is about played out.
Don't raise my power bill and tell me it's because we consuming more energy; "be honest" it must have cost hundreds of thousands of dollars to change your brand name, all your trucks, uniforms, advertisements, etc... Let me give you some assistance; Stop advertising what a waste I mean who are you advertising too? you are the only place in Nevada we can get power from, for the record that is called a Monopoly which unless the law's have changed is illegal in America. Solar Powered Energy is as Green as it gets people, and Las Vegas is a beautiful place surrounded by a whole lot of desert and plenty of sun. The real question is can we not afford to do it...
sheckyvegas:
Yeah, that would be a smart thing to do - chucking rocks and bricks at NV Energy's office. You going to bail everyone out of jail if they so happen to be stupid enough to do that??
Why isn't the Governor commenting on how NVEnergy is raising rates when we are in a recession and people are struggling financially and how are they going to handle that $10 per year more on their bill, yada yada yada. It's almost as heinous as that sales tax increase.
"Thompson said he understands the burden on families, but also had to factor in a fair return for the company's investors."
Is he saying they raising rates because they want a larger profit margin?
The GOVERNOR, give me a break. He only vetoes things he knows will be overridden. Come to think of it.....
We can nationalize the banks, the car companies, wall street. We can bail out everybody who is anybody as long as you make more than 10 mil. We can elect short sighted hypocritical morons to "public service". But a Public Utility, a for profit Public Utility, that's sac-ro-sanct. Got to give them whatever they want. After all, we got all of those rate payers by the short ones, it's only 110 degrees outside, quit whining and turn down your thermostats to 60. Find a lower price and your power is freeeee.
Price of fuel has decreased, they are getting the rate hike because they "spent" $$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$ on capital improvements, which they do EVERY year and pass on to you no matter if the improvements are needed or not.
frivilous examples:
1. land and construction for new coal power plants which are now scrapped
2. "new" offices across the state
3. The name change and all the "infastructure" that goes along with that.
With all the money to be made, why dosen't some other company move into Las Vegas and give NV Power some compitition? You know they will get the original 14% they asked for originally eventually.
Worst commissioners ever! But then what did you expect? These guys were appointed by Gibbons right?
I 'm sure the numbers of residential customers have dropped drastically leaving them with an enormous hole to fill.So why not throw it on the backs of those already trying to staying afloat. Just another nail in the coffin. And the increase to commercial users was ???
If you really want to stick it to NVE then tell your HOAs to go screw themselves and put in roof-top solar. Yeah, it will cost a bundle up front, but now is the right time and just imagine the value-added when the housing market gets going again. Roof-top solar *will* be passed sooner or later, might as well give it a push. Besides, the cost can't be that much more than the bail/fine for taking the action suggested by someone else.
What math are they using? 6.9% increase is $10.29 per YEAR? ROFLOL. wtf...seriously, is everyone this stupid? it's like $169*12*.069 (for the mathematically challenged living in any house here in the area). That's like $130. anyway, what do I know. and good to see there is NO INFLATION anywhere to be found...keep printing money then...
"It only took one brick to make that window drop..." - Sublime, 1996
Does this mean you're going to throw the one brick?
Your free market economy at work. Live with it!
Uh RedwoodTree,
The article clearly states $10.29 per MONTH...which works out to a little over $123 per year. My bill last month was slightly over $32 and I expect to not exceed $100 in July or August.
Ok, so the reason for increases is because there is more energy being used? There are hundreds of foreclosures and people are moving away. How does this increase the amount of power being used? We have to do something about this. To watch them say its necessary without and explanation is beyond words. We have idiots in charge of very important things.
hey boftx!
SB 114 which takes effect on July 1st, 2009 makes void an unenforceable any HOA rule, covenant, etc that prohibits or unreasonable restricts a property owner from using a system for obtaining solar or wind energy on his property.
"Unreasonably restricts" is defined as anything that reduces the efficiency of the system by 10%, so they can't make you install them in inefficient places that are out of sight. I would find your installer, have them plan an ideal installation, and submit it to your HOA. They can't deny it or make you modify the installation in a way that reduces it's efficiency by 10%. If they resist, furnish them with a copy of SB114.
thank you Senator Schneider of Clark District 11 for taking on this issue!
text of the enacted bill can be found here.
http://www.leg.state.nv.us/75th2009/Bill...
If you are one of the lucky few who still has a job and disposable income, you might want to take advantage of Obama's tax breaks for energy conservation: windows, insulation, dorrs, ceiling fans, etc are all included. I'd like to add solar on the roof, but that is simply too expensive right now. For those of us without jobs ot disposable income, vigilant conservation (i.e. turning off the lights, cleaning your AC filters, etc.) requires no up front cost and can save 10-15% on your monthly bill.
Using less energy is the smart and effective way to stick it to the power company.
Throwing bricks at public utility offices is not only illegal and dangerous, but just plain dumb. There are smarter ways to take a stand and make your displeasure heard.
For more information on the federal energy conservation tax breaks, visit:
http://www.energystar.gov/index.cfm?c=pr...
"...they also are instructed to maintain a strong financial position for the company so it doesn't have its credit ratings downgraded, which would make it harder to find financing for new projects.". Just who is issuing these "instructions"? My credit rating has been downgraded, thanks to politicians and their ill-advised credit card legislation, which lowered my credit limits, therefore lowering my credit score, obviously without the benefit of "instructions", and I can't get financing for a new anything!...why should NV Energy not tighten their belts, delay new projects and suffer a bit in this economy like the rest of us are doing?