weather icon Clear

Report: No clear answers on Nevada electricity rates if Question 3 passes

Updated July 23, 2018 - 11:05 am

CARSON CITY — It’s too difficult to predict whether Nevadans’ electricity rates would go up or down in an open energy market under Question 3, a local think tank said in a report released last week.

Opponents and proponents of Question 3, the Energy Choice Initiative that would do away with the state’s energy monopoly in favor of retail choice, have argued at length about whether the proposed constitutional amendment would bring higher or lower electric bills for Nevadans.

The Guinn Center sought to try to answer that question for voters. The group reviewed federal energy data, conducted more than two dozen interviews and analyzed research from other states that have restructured their energy markets.

But what it found was a complicated issue without an easy answer.

“Many Nevadans likely want to know what will happen with their electricity rates,” the report’s executive summary states. “This report finds that this question cannot be answered with any certainty, because there are too many variables that interact with one another even to produce a reasonable forecast or projection of what may happen to rates under restructuring in Nevada.”

Both sides of the Question 3 fight latched onto parts of the report to bolster their claims.

“The facts are that in deregulated states, average residential electricity rates are 30 percent higher than they are in Nevada, and, as the Guinn Center concluded, Nevada would no longer be able to protect consumers from rate increases if Question 3 were to pass,” said Tracy Skenandore, spokeswoman for the No on 3 campaign.

Meanwhile, the group supporting the measure, Yes on 3, highlighted the finding that states with lower natural gas prices tended to have lower open-market rates.

“Question 3 will create competition and lower Nevadans’ energy bills,” said Jon Wellinghoff, policy adviser for the Yes on 3 campaign. “This report highlights the benefits states with energy choice see, particularly with respect to natural gas prices in lowering the cost of energy to consumers.”

Mixed results

The report notes that other states that have restructured their energy markets “experienced mixed results.”

“Across multiple states, many consumers have been enticed by low teaser rates offered by electric suppliers to sign up for variable-rate electricity contracts, but were unaware that their bills could increase at any time, and often did, as market conditions changed,” the report concludes.

A report issued in May by the Nevada Public Utilities Commission said Nevadans’ electricity bills would likely increase for at least a decade if Question 3 passes, in large part because of billions of dollars of stranded NV Energy assets for which ratepayers would be on the hook.

Question 3 supporters disagreed with that conclusion as well as the appropriateness of a regulatory body taking a position on a ballot question.

The Guinn Center report notes that those stranded costs could influence rates, especially if rates are not capped or frozen.

Another major takeaway from the report: The PUC “likely would no longer be able to able to intervene to protect consumers against higher rates, as that could undermine the intent of the initiative petition.”

Not an immediate change

Implementation also could be tricky, the report says.

First, Nevada would be the only state to restructure its market by amending its state constitution.

Of the 15 other states that have, 14 did it through state Legislatures, while New York did it through a regulatory order issued by its Public Service Commission.

Question 3, if passed, would require the restructured market be put in place by July 1, 2023 — or less than five years after passage. Pennsylvania, the report noted, took 16 years to implement energy choice.

One of the other key issues the two sides of the Question 3 fight have argued over is what will happen to clean energy projects in Nevada, with opponents of the measure saying it will only damage those efforts.

But the Guinn Center report concluded that “increased renewable energy (solar) generation assets may come online regardless of whether Question 3 passes.”

The Review-Journal is owned by the family of Las Vegas Sands Corp. Chairman and CEO Sheldon Adelson.

Contact Colton Lochhead at clochhead@reviewjournal.com or 775-461-3820. Follow @ColtonLochhead on Twitter.

Don't miss the big stories. Like us on Facebook.
Politics Videos
Tomi Lahren Speaks at UNLV - VIDEO
Fox News contributor and UNLV alumna Tomi Lahren returned to campus Wednesday night for a speech, titled “Stay Triggered,” that drew an auditorium of supporters as well as a group of protesters outside. (James Schaeffer/Las Vegas Review-Journal)
Bernie Sanders released from Las Vegas hospital - VIDEO
Sen. Bernie Sanders, I-Vt., issues a statement after he was released from Desert Springs Hospital Medical Center on Friday, Oct. 4, 2019, after suffering a heart attack earlier in the week. (Bernie Sanders via Twitter)
Democratic presidential candidates speak on impeachment - VIDEO
Democratic presidential candidates attending the March for Our Lives/Giffords Gun Safety Forum in Las Vegas comment on possible impeachment proceedings. (Las Vegas Review-Journal)
Joe Biden Las Vegas Rally Highlights - Video
2020 presidential candidate, Joe Biden, came to Las Vegas to talk guns, climate change and the Ukranian-Trump scandal. Biden was interrupted by a protestor who sat amongst supporters at the rally and continued with his speech. (Angus Kelly & James Schaeffer / Las Vegas Review-Journal)
Joe Biden comments on Trump and his campaign efforts in Nevada - Video
After an impeachment inquiry was opened on Donald Trump, Joe Biden talks with Review-Journal politics reporter Rory Appleton about Trump and his campaign in Nevada. (Angus Kelly & James Schaeffer / Las Vegas Review-Journal)
Bernie Sanders Unveils Affordable Housing Plan - Video
Bernie Sanders sits down with the Las Vegas Review-Journal to talk about his new affordable housing plan he unveiled at Plumbers & Pipefitters.
Jim Marchant talks gun control and Dreamers - Video
Republican Candidate for District 4 Jim Marchant talks about gun control and immigration policies. (Las Vegas Review-Journal)
Hurricanes, Gender, and Science in the Press
Imagine if the mainstream media’s current hurricane-sized obsession with scientific accuracy applied to gender.
Cory Booker on college tuition and minimum wage
Cory Booker talks on the RJ Politics podcast about college debt, informing workers about their rights and livable wages.
Nevada Politics Today: Teacher raises - VIDEO
Jason Goudie, the chief financial officer for the Clark County School District, talks about teacher pay and raises. (Las Vegas Review-Journal)
Media's Double Standard On Incitement And Trump - Video
Over the weekend, an Elizabeth Warren-supporting socialist who opposed gun violence used a rifle to commit a mass murder in Dayton, Ohio. The media has downplayed that aspect of the tragedy.
Project Our Care Tour Kicks Off In Las Vegas
U.S. Rep. Dina Titus joined health care advocates and local residents as part of Protect Our Care’s nationwide bus tour kick off in Las Vegas on Monday, August 5, 2019. (Mat Luschek / Review-Journal)
Bernie Sanders talks about guns, response to El Paso shooting
Sen. Bernie Sanders spoke about his response and continued policy ideas about guns and gun control to the Review-Journal after a panel of other topics. (Rachel Aston/Las Vegas Review-Journal)
Pete Buttigieg On Gun Control And Climate Change - Video
Pete Buttigieg talks about his campaign for the 2020 election and how Nevada is a vision of what the future can be.
Beto O'Rourke speaks in Las Vegas
Presidential candidate Beto O'Rourke spoke to supporters at the East Las Vegas Community Center in Las Vegas, Thursday, Aug. 2, 2019. (Las Vegas Review-Journal)
Nevada man killed, others hurt in wrong-way I-80 crash

A 27-year-old Nevada man driving the wrong way on U.S. Interstate 80 just west of Carlin was killed when he collided head-on with a Range Rover carrying two Montana residents who were injured, at least one seriously.