Ratepayer risk?

Whistle-blowers are expressing concern over a state Senate bill, recently amended, that they fear could stick NV Energy’s Nevada ratepayers with the costs of a billion-dollar transmission line intended primarily to ship electricity to California.

Because recent environmental lawsuits blocked solar projects in the California desert, utility companies there will be lucky to get halfway to their state-imposed mandate of 30 percent power generation from renewable sources anytime soon. NV Energy thus sees an opportunity to sell higher-priced electricity from Nevada solar, geothermal and wind farms to California.

But in a May 19 letter to Assemblyman Kelvin Atkinson, of the Assembly Committee on Commerce and Labor, Attorney General Catherine Cortez Masto notes that if Senate Bill 488 passes and “NV Energy’s plans are not fully successful, Nevada ratepayers could bear a substantial portion of the $1 billion estimated cost. This is a significant risk” to ratepayers.

“Further,” writes the attorney general, while independent firms stand ready to build such lines, “SB488 provides competitive advantages to NV Energy over independent transmission developers because NV Energy has the ability to have Nevada ratepayers bear the risks/costs associated with speculative investments.”

Not only that, SB488 as amended could allow NV Energy to come back after the fact and ask the Public Utilities Commission to make ratepayers help cover the costs of “construction of transmission facilities” not included in the utility’s most recent three-year resource plan filing.

Renewable energy sources are heavily subsidized. Even then, concerns over cost and reliability mean energy companies buy large amounts only when required to do so by law. When those subsidies run out, transmission lines targeted for such deliveries could become costly white elephants.

NV Energy officials deny Nevadans bear any risk. And spokesman Rob Stillwell said Friday the new construction authorization sought in SB488 could actually benefit Nevada ratepayers, because profits made by selling excess renewable power to other states could be used to reduce rates.

But Ms. Cortez Masto’s point is well taken. SB488 could spread risk to the public. If there were a case to be made for this, why was it not given a timely airing, months ago?

SB488 should be defeated.

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