NV Energy senior executives weren’t singing “Happy Days are Here Again” on Wednesday, but they did give analysts reasons to be optimistic despite the company’s $2.1 million fourth-quarter loss.
Over the last year, the average number of residential customers in Southern Nevada increased by 0.8 percent, and the growth rate was accelerating in the latter part of the year, said Chief Financial Officer William Rogers.
The electric utility company expects customer growth to hit 2 percent this year in Southern Nevada and then increase. The number of commercial customers rose an average of 2.6 percent and industrial customers by 3.8 percent during the year.
“Our community continues to have growth in population,” Rogers said, noting that new hotel rooms are expected to add jobs and attract new residents. MGM Mirage’s $9.2 billion CityCenter is hiring 12,000 workers, said Chief Executive Officer Michael Yackira.
Despite the economic slump, NV Energy reported increased profits last year. The company earned $208.9 million, up from $197.3 million in the prior year although earnings per share remained at 97 cents because of an increase in common stock.
Operating revenues decreased 2 percent to $3.5 billion from $3.6 billion for the year.
Fourth-quarter operating revenues fell 2.6 percent to $766.1 million from $786.6 million a year ago.
The electric utility holding company reported a fourth-quarter loss of $2.1 million or 1 cent per share, which it attributed to higher depreciation, maintenance expenses, higher interest expenses and a regulatory factor. The company earned $3.7 million or 2 cents a share in the last quarter of the prior year. The consensus of seven analysts was for 2.8 cents in earnings for the quarter, according to Bloomberg News.
Most of the decrease stemmed from expenses for two new generating facilities, a 600-megawatt plant built at Clark Generating Station in southeast Las Vegas and the 600-megawatt Walter Higgins Generating Station in Primm that was purchased from Reliant Energy, Yackira said.
NV Energy has spent about $71 million on development of the coal-fired Ely Energy Center, which it announced Monday is being shelved for 10 years or until carbon dioxide capture and storage technology is commercially feasible. That number includes money spent on water rights and for work related to a 250-mile transmission line that NV Energy still wants to develop between Las Vegas and the Ely area.
NV Energy wants to build the line despite a similar power line project proposed by LS Power, an independent power company based in East Brunswick, N.J., Yackira said.
“We believe it’s best for our customers and our state to have control of that transmission line,” he said. He also favored state regulation if NV Energy owns the line while a federal agency will regulate a line built by LS Power. NV Energy has extensive experience in building transmission lines unlike LS Power, he said.
NV Energy intends to spend $3 billion on new lines and equipment over the next four years.
Shares of NV Energy dropped 44 cents or 4.2 percent to $10.07 in heavy trading of 5 million shares on the New York Stock Exchange Wednesday.
Contact reporter John G. Edwards at email@example.com or 702-383-0420.