Lone legislator makes last-ditch effort to change major energy bill

By Andrew Doughman

Sunday, June 2, 2013 | 3:15 p.m.

Hey, readers, pop quiz:

If the state’s largest casinos, NV Energy, Nevada’s U.S. Sen. Harry Reid, Gov. Brian Sandoval, large labor unions and advocates for the environment were on one side of a legislative issue, and a Republican Assemblyman from Sparks was on the other, which side would prevail?

If you guessed the guys with the political and economic clout, your intuitive political sense is spot on.

Assemblyman Ira Hansen failed today to amend a major energy bill in a manner that he said would protect Nevadans from higher energy bills.

Senate Bill 123, a measure NV Energy calls “NVision,” would require the utility to stop producing electricity with coal and allow it to replace it with 350 megawatts of renewable energy and 550 megawatts of natural gas or another unspecified energy source.

While supporters have cheered the proposed exit from the coal market for political, legal, economic and environmental reasons, Hansen, in a last-ditch effort to insulate Nevadans from higher rates, railed against the lack of regulatory oversight provisions.

“This bill would allow the policy of removing coal to go forward, would allow the needed additions to energy plants to be allowed, but would also ensure that the ratepayers and not the shareholders would be paramount in the decision-making process,” Hansen said.

His amendment would have deleted the part of the bill that allows the company to build or acquire a 550 megawatt power plant in exchange for exiting the coal market.

Instead, Hansen’s amendment would allow the Public Utilities Commission of Nevada to regulate the state’s energy monopoly in its usual manner to decide what mix of energy efficiency, power purchase agreements, contracts with private energy providers, and utility-constructed power plants is used.

Noting that the construction of power plants like the recent Harry Allen generating station cost upwards of $500 million, Hansen said construction may be necessary, but the Public Utilities Commission of Nevada should be the one making that decision, not the Legislature.

Historically, construction has cost ratepayers via rate hikes when the utility comes to the PUC to recoup its investment by charging Nevadans more on their bills.

Notwithstanding nearly unanimous support for exiting the coal market and possible associated cost savings, the utility estimates the plan will raise rates during the next 10 years.

Hansen’s amendment also would have removed a provision under which NV Energy “shall” charge interest on the new power plants. Instead, the amendment said that “an electric utility may, upon approval of the Commission,” charge interest.

Hansen, though, had almost no chance to prevail against the powerful allies in support of the bill.

Citing a Sun article featuring an interview with Reid about the bill, Hansen said the public’s interests aren’t represented in this matter.

Lawmakers have largely accused regulators of inappropriately meddling in legislative affairs.

Democrats said regulators will need to adjust to a new regulatory regime under which the energy monopoly will have more statutory authority to regulate its own affairs.

“As we move forward in this new era of energy, things are going to be done differently,” said Assemblywoman Maggie Carlton, D-Las Vegas. “We’ve accomplished our mission on this. I think we still have the oversight and involvement that is going to be needed to protect our constituents on this.”

Carlton said a new legislative committee on energy is under consideration in Assembly Bill 428.

That new committee would review energy bills, their effect on rates, the environment and the economy.

After ignoring Hansen’s amendment, Assemblyman William Horne, D-Las Vegas, told the chairman of the Assembly Commerce and Labor committee to move forward with SB123.

“It’s impressive the number of stakeholders you've got on board with this as well,” Horne said.

Democrats voted in favor of the bill while Republicans on the committee voted against it.

The bill now awaits consideration of the full Assembly. It needs to pass by the end of Monday, the last day of the legislative session.