NV Energy, competitor to pitch to be Las Vegas power provider
The Las Vegas City Council said it will listen to retail electricity offers from NV Energy and Texas-based Tenaska Power Services Co. on April 3.
Las Vegas policymakers signaled their willingness on Wednesday to depart from NV Energy if the cost savings delivered by an emerging competitor can surpass a proposal from the city’s longstanding electricity partner.
With its renewable energy agreement with NV Energy set to expire in December, the City Council said it will listen to retail electricity offers from NV Energy and Texas-based Tenaska Power Services Co. during an April meeting.
Both companies say they can continue to meet the city’s renewable energy goals while trimming costs.
“One way or another, we’re going to save money,” said City Manager Scott Adams, who framed the city’s exploration of a reduced-cost energy deal as a forward-thinking opportunity to address a structural budget deficit.
Unions and nonprofits, however, urged the city to stay with NV Energy, concerned about the potential for job losses and decreased community support.
Further complicating matters, the state Public Utilities Commission would have to approve a departure and determine an exit fee and other specifics. The city has not filed any paperwork with the commission.
Jonathan Rogers, a consultant with Energetics, the firm hired in September to guide the city through its decision, said a PUC ruling could take three to six months.
While city officials have left the door open to leave NV Energy amid a recent exodus from the utility monopoly, they were also complimentary of the relationship. “They’re family,” Mayor Carolyn Goodman said, underscoring the uphill climb that an out-of-state company might have in overcoming NV Energy’s established goodwill.
“Why would we pick somebody that we don’t even know over somebody that we have a track record with?” Councilman Bob Coffin said.
Las Vegas is one of the largest cities in the world to claim operations fully powered by renewable energy, according to Tom Perrigo, the city’s executive director of community development.
It’s a distinction, he noted, that has been achieved through strategic investments over the past decade, leading to a reduction in annual energy costs from $15 million in 2008 to $8.4 million in fiscal year 2017.
A city partnership with NV Energy has been part of that strategy, Perrigo said, in the form of a low-cost renewable energy rate option, announced in 2015, that costs the city $228,000 yearly.
NV Energy is preparing to unveil its next version of the program, Nevada GreenEnergy Rider (NGR) 2.0, which will offer more than a million megawatt hours of renewable energy resources at reduced costs to large commercial customers including casinos and governments.
NGR 2.0 will be compared directly to the proposal by Tenaska, which believes it can save the city an additional $3 million per year, or cut about 30 percent of costs, according to David Brown, a consultant with Land Development Associates, which represents Tenaska.
Tony Sanchez, the senior vice president of government and community affairs for NV Energy, noted that alternative power providers are not beholden to the same state regulatory obligations. He said rates are 15 percent cheaper than a decade ago and also are estimated to decline over the next 10 years.
Even if the city were to leave NV Energy, the company would continue to provide transmission, distribution and ancillary services.
Contact Shea Johnson at firstname.lastname@example.org or 702-383-0272. Follow @Shea_LVRJ on Twitter.
Where does Las Vegas get its power from?
NV Energy — 55 percent
Silver State Energy Association — 27 percent
Solar panels at 40 city facilities — 10 percent
Hoover Dam — 8 percent
Source: City of Las Vegas