Las Vegas Sun

September 26, 2018

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Valley will subsidize BC power no more

Error allowed city to keep flat rate for 20 years

An Energy Addition

A view of NV Energy's Walter M. Higgins Generating Station outside of Primm, Nevada. Launch slideshow »

Beyond the Sun

For about a decade the Las Vegas Valley has been helping to cover Boulder City’s electric bills, at an estimated cost of more than $3 million last year alone.

The reason: NV Energy has charged Boulder City the same rate for wholesale electricity since 1990, the town’s energy lawyer, Tim Shuba, told the Boulder City Council on Tuesday.

“Nobody’s rates have been flat for the past 20 years,” Shuba added. “Somehow they forgot about you and the contract just sat there.”

But the Public Utilities Commission staff pointed it out last year when NV Energy was pushing to raise the valley’s power rates, so now the statewide utility is set to end its long honeymoon with the town that built Hoover Dam. A catch-up rate increase, charging Boulder City more than two and a half times as much for the wholesale power it gets from NV Energy, is expected to be in place as soon as Oct. 1.

“It appears we’ve been extremely fortunate for a long, long time, and the fun is over,” Boulder City Councilman Duncan McCoy said.

His town of 17,000 has had a contract with the private utility since 1989 to buy wholesale power for its residents when hydroelectric power from Hoover Dam and nearby Glen Canyon Dam can’t meet demand. That’s mainly during the summer.

But because the per-kilowatt-hour charge from NV Energy has stayed the same for so long, for years Boulder City has been paying less for its NV Energy power than the cost to produce the electricity. Valley ratepayers wound up helping to make up the difference.

This fall, after NV Energy goes to the Federal Energy Regulatory Commission for permission to raise its wholesale rates, Boulder City is expected to begin paying 260 percent as much for NV Energy power. During the summer, NV Energy provides more than half of what Boulder City uses.

Patty Jacobson said she and her husband are bracing for the rate increase by hanging a clothesline and disposing of an “antique” refrigerator.

“My mother and father bought that when I was in the sixth grade, but it probably uses as much power as a Buick,” Jacobsen said.

Even with the increase, though, Boulder City residents will still pay much lower rates than valley dwellers — 7.5 cents per kilowatt hour compared with 11.7 cents per kilowatt hour.

That’s because Boulder City gets its power at a wholesale price, and the city then acts as the power provider for its residents, whereas most valley residents pay retail power rates.

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