by Dana Gentry, Nevada Current
A proposal by NV Energy that would save ratepayers a few bucks on their electric bills now, but cost more later, will be heard today by the Public Utilities Commission, the agency that regulates utility monopolies in Nevada.
The PUC will also hear the utility’s request to increase its rates to offset the cost of natural gas and power it purchased last year. NV Energy said in a news release its natural gas costs “increased by more than 70 percent and peaked in January of 2023, increasing nearly 500 percent since 2021.”
“NV Energy works hard to provide our customers low-cost energy services that are below national average electric rates and more than 50 percent cheaper than those paid in California,” NV Energy CEO Cannon said in a news release this month.
But data from Electric Power Monthly, published by the Energy Information Administration, the statistical apparatus of the U.S. Department of Energy, indicates electricity for residential customers in Nevada is more expensive than the national average and not more than 50% cheaper than in California.
Year-to-date for March 2023, the national average for residential electricity was 15¢ cents per kilowatt hour (kWh), 17¢ cents per kWh in Nevada, and 27¢ cents per kWh in California.
Electricity for all sectors was 12¢ in the U.S, 12¢ in Nevada, and 22¢ in California.
Asked to substantiate NV Energy’s claim that electricity was 50% less expensive in Nevada, utility spokesperson Meghin Delaney provided the Current with the data from Electric Power Monthly, which does not reflect the CEO’s claims.
The move by NV Energy to reduce its rates statewide for the summer months came after Consumer Advocate Ernest Figueroa, who heads up the Attorney General’s Bureau of Consumer Protection, projected the average power bill in Southern Nevada would reach $470 for July.
“Recognizing the challenges higher energy rates create for customers, especially in the summer months, we decided to step in and deliver a solution,” NV Energy CEO Doug Cannon said in a news release last month.
But under state law, NV Energy is allowed to receive about 8% profit from carrying the unpaid energy costs on their books as deferred energy charges, which are eventually passed on to ratepayers along with the carrying costs incurred by the utility. Ratepayers will eventually be charged a higher rate for their summer usage.
NV Energy earned $36.2 million ($28.4 million in Southern Nevada and $7.8 million in Northern Nevada) last year in profit on deferred energy balances, according to exhibits filed in pending cases before the Public Utilities Commission.
Figueroa is expected to argue against NV Energy’s plan to pass the carrying costs on to customers. That hearing begins at 2 p.m.
NV Energy is asking regulators to approve a 3.3% general rate increase for its full-service Southern Nevada customers, residential and commercial, and an 81% rate increase for distribution-only customers such as Caesars Entertainment, Wynn Las Vegas, MGM Resorts International, and Switch, according to a June 5 filing with the Public Utilities Commission.
Customers who receive just distribution services purchase their energy from other sources but use NV Energy’s infrastructure in the distribution process.
“The percent changes are not an apples-to-apples comparison because distribution only customers do not receive all of their energy services from NV Energy,” said Delaney, the utility’s spokeswoman, via email.
The Nevada Resort Association, which represents casino properties, did not intervene in the proposed increase for DOS customers, according to president Virginia Valentine.
The increases would allow NV Energy to recover $92.7 million “in additional costs it is incurring” to serve Southern Nevada, the utility said in a news release. Those costs include the utility’s increases in fuel and purchased power expenses.
The 3.3% increase is across all customer types. For residential customers, the increase amounts to 2.7% and includes a $5.50 increase in the monthly basic service fee.
“The increase in the basic service charge causes a decrease in the charges that are assessed based on monthly usage,” Delaney of NV Energy said via email. “So, one bill element is increasing while another is decreasing and the overall impact is $5.50.”
NV Energy’s residential customers in Northern Nevada will see an increase of 8.12% on their monthly bill effective January 1, 2023, should the PUC approve the utility’s rate hike request. The hike would increase revenue by $6.4 million a year, the utility said in a filing.
A consumer session is scheduled on those proposals at 6 p.m. Tuesday.
Members of the public can attend the consumer hearing at the PUC offices in Reno and Las Vegas, or access on-line at puc.nv.gov.
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