Rate-hike need may disappear

Fred Schmidt hopes savings from the proposed merger of the Las Vegas-based utility and Reno-based Sierra Pacific Resources would offset the rate-case request.

Also, he suggested Thursday that the companies could recover some of their energy expenses from the sale of power plants, rather than through a rate boost.

Nevada Power and Sierra Pacific have proposed selling about $1 billion in power plants if the state Public Utilities Commission approves their merger.

The PUC Wednesday dismissed a request filed by Nevada Power for a $43 million rate increase, saying the April filing came too soon after a $43 million rate increase was approved in February.

The utility then sought to recover some of the same expenses through the $49.4 million case filed later Wednesday.

Schmidt said the new case comes at a better time from the perspective of electric customers because the PUC will be considering the merger request at the same time.

"All we have to do now is find a way to convince (the PUC) that there's savings likely to occur from the merger or from the sale of generation (facilities)," Schmidt said.

The companies predicted the merger would save them about $350 million over 10 years.

Electric rates shouldn't be increasing as Nevada prepares to open its regulated, electric utility markets to competition in 2000, Schmidt said. Nevada Power, he added, may plan to raise rates overall so it can offer more competitive rates to its largest customers, who will have alternative sources of power in a competitive market.

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