Shining a light on future power rate increases

Never let it be said that if I couldn't come up with an apt analogy of my own, I was unwilling to pilfer one.

When the Public Utilities Commission on Wednesday took up consideration of the Review-Journal's request to obtain confidential contracts between our monopoly power company, NV Energy, and seven projects hoping to wholesale renewable power to it, Chairman Sam Thompson spelled out why the newspaper asked for those contracts in the first place.

"The analogy, although not a good one," Thompson drawled, "is pulling up to the Exxon pump and filling your car up with a piece of black tape over the price per gallon. And I don't know of anybody in this room who'd do it. I know I wouldn't."

Precisely.

In order for the ratepayers to know how their access to electricity is being managed -- whether there'll be enough and at what price -- they need to see the price of what will be coming down the line in the future.

Whatever NV Energy pays to buy electricity is passed along to the customer.

As part of this process, NV Energy has filed with the PUC a resource plan outlining how it will generate and finance electricity for the next 20 years. The plan includes contracts with renewable-power companies totaling more than 400 megawatts of electricity. This is because the state Legislature requires the utility to generate 25 percent of its power from nonpolluting renewables -- solar, wind, geothermal, biomass, etc. -- by the year 2025 in order for Nevada to do its part to save the planet from the disaster that would surely befall should temperatures increase 2 degrees in the coming century. (Read the preceding with dripping sarcasm.)

Though the PUC will take up some aspects of the contracts to determine whether they contain trade secrets or proprietary commercial information that deserves some level confidentiality, Thompson made short shrift of any contention that pricing can be kept from the public.

"It was my opinion after reviewing each of these PPAs (power purchase agreements) in depth, it was my opinion after receiving briefing memorandums from all parties with regard to why they should be confidential, that the pricing information is not confidential. ..." Thompson said. "This is a quasi-governmental agency. (NV Energy is) a monopoly that's regulated … and any money that they spend or propose to spend or bind the ratepayers to spend is a public document, and that price should be disclosed."

But Commissioner Rebecca Wagner, speaking from Carson City, had some concerns about how the Review-Journal would use the pricing information.

"What I find intriguing about this is: What's the mystery about the power purchase agreement?" Wagner said. "We know that the cost per kilowatt-hour or megawatt-hour is more expensive … recognizing renewable energy to be more expensive, but also recognizing it has minimal to no emissions. … Also, it is an economic development tool. I guess I'm a little leery of that kind of request because there are so many other things that go into our rate."

She proceeded to list power plants, transmission lines, distribution lines, the fuel for the power plants.

"NV Energy in total purchases nearly a billion dollars in fuel and purchased power a year. Right now that is down lower because of natural gas prices. I mean that's a significant amount of money," she said. "Salaries and benefits and the little NV Energy cars we see driving around, all of those go into rates. So I just want to make sure that however this information is used by the Review-Journal, and I assume they'll follow the guidelines of journalistic integrity and use this in context and not as some kind of benchmark to say that renewable energy drives up our rates. Yes, it impacts our rates, as do a number of things."

Journalistic integrity? Should we ignore the facts she has so clearly stated? Many renewables cost three times as much or more. Let me be the first to tell you: Most renewables are not commercially competitive and must be subsidized with tax or rate money. Also, every watt of photovoltaic solar and wind power must be backed up by a cheaper, reliable fossil fuel generator that is turned off when the sun shines and the wind blows.

It may take a couple of weeks, but eventually the newspaper should be able to tell you specifically how much more renewable energy will cost.

It would be futile to call up the power company or the PUC and demand cheaper sources of electricity. But when you pull up to the pump known as the ballot box this November, you should be asking yourself: Will these state Senate or Assembly candidates continue to force my power bills to go ever higher because they want me to pay to "save the planet"?

Your choice.

Thomas Mitchell is editor of the Review-Journal and writes about the role of the press and access to public information. He may be contacted at 383-0261 or via e-mail at tmitchell@reviewjournal.com. Read his blog at lvrj.com/blogs/mitchell.