NV Energy rate boost curtailed

A preliminary decision from the Nevada Public Utilities Commission could mean local power utility NV Energy Inc. gets a significantly smaller rate increase than it requested.

The commission’s Wednesday draft order, which Commissioner Sam Thompson wrote, calls for a 9.3 percent increase in single-family residential rates, compared with the 16.7 percent jump NV Energy sought. Add in further reductions based on anticipated drops in fuel and power costs in coming months and years, and the average rate boost should be around 6.8 percent, or $10.05 a month.

The draft order also grants NV Energy a revenue requirement of $217.8 million, or about 70 percent of the utility’s requested revenue requirement of $310.9 million.

NV Energy spokesman Adam Grant said Thursday that utility executives are still reviewing the draft order, and it’s the company’s policy to decline comment on preliminary orders.

Thompson and a second commissioner, Rebecca Wagner, will discuss and decide the increase at a special-agenda meeting scheduled for Wednesday at 9:30 a.m. inside commission headquarters at 101 Convention Center Drive. The commission’s third member, Jo Ann Kelly, has recused herself from the case because of her family relationship with intervening party Boyd Gaming Corp.

The special-agenda meeting is open to the public.

Thompson’s draft order calls for the rate increase to phase in over six months. A first jump of 3 percent would kick in July 1, when the average single-family residential power bill would rise $7.68 a month, going from $256.15 to $263.83. The second increase of 3.8 percent would come Jan. 1, when the average single-family residential electric invoice would increase $8.31 a month, from $120.87 to $129.18.

“This approach is consistent with the concept of gradualism advocated in this case because it will allow (NV Energy) the opportunity to earn its authorized return while at the same time allow a gradual introduction of higher rates,” Thompson wrote. “This will allow consumers to adapt their budgets and energy practices to the higher rates because the bulk of the increase will occur during the winter and not summer season.”

State Consumer Advocate Eric Witkoski said ethical rules prevent him from discussing his opinions on draft orders, because such comments could influence the outcome of a rate case.

Asked if he thought raising rates 6.8 percent during a recession was fair to consumers, Witkoski said many parties to the case have sought ways to mitigate an increase’s effects on power customers.

“They recognize not only that rate increases are difficult for ratepayers, but specifically during these current economic times, (higher rates) are really tough or onerous to deal with,” Witkoski said.

Contact reporter Jennifer Robison at jrobison@reviewjournal.com or 702-380-4512.

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