Nevada government officials are continuing to push ahead withlicensing of nonutility electricity service providers and otheraspects of restructuring the state’s power industry, despitefederal and state court challenges by the two incumbent utilitiesthat promise to delay implementation of a more competitiveelectricity market by up to 18 months.
National ESP NewEnergy, a unit of Arlington, VA-based energygiant, AES Corp., received Nevada’s certification Tuesday and usedthe occasion to blast the state’s incumbent investor-owned electricutilities (Sierra Pacific and Nevada Power) for “stalling thestart” of the state’s restructuring, which under a state law passedlast year was suppose to kick off March 1. About a dozen powerproviders have been licensed to date.
Nevada Gov. Kenny Guinn initially delayed the start ofderegulation earlier this year and established a series ofstakeholder meetings attempting to work out issues such as thefunding and structure of a proposed independent systemadministrator to run Nevada’s grid. (NewEnergy supported thegovernor’s delay at the time.) Those meetings will continue withone on Friday, April 28, according to a spokesman in the governor’soffice in Las Vegas.
While lauding the state legislature and the Nevada PublicUtilities Commission, NewEnergy vice president Lawrence Petersonsaid the two utilities, recently merged under Sierra Resourcesholding company, are throwing “a roadblock in front of competition,delaying the start date and establishing new rules that water downthe potential benefits to consumers..
Peterson called the legislative and Nevada PUC process as “fairand open,” noting that the rules and process developed could be “amodel for other states to follow.” Arguments in the state lawsuitwill begin May 22 in Carson City, the state capital.
Nevada Power and Sierra Pacific Power filed in federal court inlate March to have Nevada’s state electric restructuring law struckdown as unconstitutional. They argue that the law should be fair toall stakeholders, including their shareholders, and they contend inits current form, it harms shareholders. Similarly, theysubsequently have filed in state court to strike down the NevadaPUC’s actions to impose the legislatively mandated rate freeze andsubsequent lowering the electric utility rates for Nevada Power.
The PUC and Nevada Power are “more than $100 million apart inthe rate issues, but we’re having another stakeholders’ meetingFriday,” said Gov. Guinn’s spokesperson, Jack Finn. “I don’t knowif Nevada Power will attend, but we certainly hope they do. Thereare other issues that we feel that we can reach some common groundon, and we continue to work on them.”
Sierra Resources would not speculate on timing and outcomes,noting that generally federal appeals take nine to 12 months andstate appeals take 12-18 months. “It is in the courts, so I thinkit needs to run its course,” a Reno-based Sierra Resourcesspokesperson said.
Both the utility and state government spokespeople indicatedthey do not expect any impact on the reliability of the Nevadatransmission grid this summer or beyond as a result of the ongoingdelay in moving ahead with electric industry restructuring.
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