PUC chief: Electric firms will focus on business

CARSON CITY -- There won't be a stampede by electric companies to sign up homeowners when competition arrives, the chairwoman of the state Public Utilities Commission predicts.

Chairwoman Judy Sheldrew told the Senate Commerce and Labor Committee Thursday that companies initially will concentrate on signing up big power users like casinos, mines and other businesses.

Her comments came after senators expressed fears that Nevadans will be inundated with telephone solicitations to sign up with new power suppliers or others offering electricity services.

Committee Chairman Sen. Randolph Townsend, R-Reno, said he "gets disgusted" when he receives calls at night from people soliciting customers for long-distance telephone service, banking and other businesses.

"Aren't residents going to get pounded?" asked Townsend referring to the beginning of open competition. Sheldrew replied, "I don't see companies spending their time making calls to residents for many, many years. They will be making them to the large companies."

After the hearing, Sheldrew said, "I don't think everybody's residential phone is going to start ringing off the hook."

Sen. Mike Schneider, D-Las Vegas, suggested that perhaps the market be opened only to residential users at first so they would get the benefit. And later, the state could allow electric suppliers to sell to commercial and industrial customers. He said if open competition starts all at once, the electric companies, "will step over the little person and go to the big companies."

Under present law, the market would be open to all customers. Sheldrew said she wanted to think about the suggestion. Schneider also said he's worried about "slamming" by electric companies such as occurred when the telephone industry was deregulated. Phone services for slammed customers were switched from one company to another without the customer's permission.

He suggested the "death penalty" for this practice, with the company losing its permit to operate in Nevada. Sheldrew said that's already in the regulation. An electric company found guilty of "slamming" could have its license revoked and Sheldrew said, "I don't think that's too severe."

After the hearing, Sheldrew said she did not think there would be the "slamming" problems when electric restructuring comes that hit after telephone deregulation.

"We've learned a lot from thse other utilities," she said. "Nobody thought when we had the marketing for telephone companies that people would do what they did illegally." The regulations by the PUC have closed many of those loopholes to protect the consumer, she said.

"We have the checks built in and it will be harder to deceive customers," in electric competition, Sheldrew said. "Having said that, I'm sure there is some other scam that will come along."

Sheldrew briefed the committee on the progress in adopting rules towards deregulation, which was supposed to start at the end of this year. But the PUC is asking the lawmakers to extend the date. Sheldrew said she would work with lawmakers in setting a new date for open competition to begin.

"It is in the public interest to delay the start of competition for potentially competitive electric service," she said.

Arizona, she said, is going to start open competition towards the end of the year. She said that state has a larger market and it would "lure" electric companies away from selling in Nevada. She's also worried about the Y2K computer problem affecting the western electric distribution system. While Nevada utilities are making progress on this, Sheldrew said the state could be affected by others in the western region.

It's also unknown when the Federal Energy Regulatory Commission will approve the merger of Nevada Power Co. and Sierra Pacific Power, which plan to sell off their generating plants and transport the power. Sheldrew also said open competition should not be started during the peak load usage periods in Southern Nevada from May through September.

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