Sandoval vetoes energy bill, calls it 'unfair burden' on taxpayers

Gov. Brian Sandoval on Friday vetoed a bill he said could have stuck Nevada's electricity ratepayers with costs to develop major transmission projects to send energy out of state.

The transmission provisions, which critics said could cost ratepayers as much as $1 billion, were contained in an amendment attached in the final moments of the legislative session to Assembly Bill 416.

Lobbyists working for NV Energy, including Sandoval backers Pete Ernaut and Greg Ferraro, worked behind the scenes to get the amendment approved .

In his veto message Sandoval cited concerns raised by critics, including worries about provisions that could allow NV Energy to recover energy exportation costs, "in some cases without prior approval," a change from current policy.

His message said, "This process would mean rate increases for the people of the state to finance the construction of facilities to service out of state customers," and added, "To increase utility rates on Nevadans struggling to emerge from a severe economic recession would result in the imposition of an unnecessary and unfair burden on our recovery."

NV Energy had argued the changes would have allowed the company to develop a transmission line that could connect renewable power generators in rural Nevada to customers in California.

The company said that the generators would pay the cost and that Nevadans would benefit because money NV Energy made exporting power could help keep rates down in the state. NV Energy also argued new transmission lines would be good for the economy.

"With such development, new construction and long-term operation and maintenance jobs will be created, thus adding revenue to local and state governments through increased property and sales tax," the company wrote in a two-page letter in support of the measure.

In a statement shortly after the veto was announced, NV Energy said: "While we believe AB416 contained important energy policy regarding Nevada's future involvement in renewable energy development, we respect the governor's decision. NV Energy will continue to work with our state and federal leaders to identify opportunities for Nevadans to capitalize on our state's abundant natural resources while ensuring cost protection for our customers."

Contact reporter Benjamin Spillman at bspillman@ or 702-477-3861.