Leaders say deregulation will get changes in 2001 Nevada Legislature
Legislative leaders agree the governor was right to put electric deregulation on hold.
But two prominent Democrats served notice the plan will get much more than just a tune-up by the time it emerges from the next legislative session, which begins in February.
Gov. Kenny Guinn blocked the door just as some of the biggest electric power users – mines and casinos – were about to win freedom to cut their own deals with power providers. Guinn said he feared Nevadans would be hit with the same huge increases in power bills as California and other states.
“It would put the people in Nevada at a risk I cannot take because supply is low and demand is high,” said Guinn.
He said he will name a bipartisan panel to look at the situation and report to him by Jan. 15 – in time for the 2001 Legislature.
Speaker Joe Dini, D-Yerington, and Minority Leader Lynn Hettrick, R-Gardnerville, Sen. Randolph Townsend, R-Reno, and Assemblywoman Barbara Buckley, D-Las Vegas, said Guinn made the right decision.
Hettrick said the law needs some modification to make sure utilities don’t get in such financial trouble that they fail.
“The problem is nobody wants the generator,” he said. “The generator’s got all the headaches, so something has to be done there.”
Townsend said many objected when the utilities commission agreed to allow pass-through rate increases but that, without that action, Nevada Power could have been in serious financial danger.
“They could either have been acquired in hostile takeover by an out-of-state organization or gone bankrupt,” he said.
But Dini and Buckley predicted more of an overhaul, saying it’s the small consumer who must be protected.
“We’ve got to take a look at the whole darned thing,” said Dini.
“Well, you can’t stop that,” said Townsend, who chairs the Senate Commerce Committee. But he said lawmakers shouldn’t throw out deregulation just because the law needs some repair.
“I don’t think reviewing deregulation entirely is necessary or prudent,” he said. “The world is going that way whether we like that or not.”
Buckley, who earlier objected to the deal with the utilities commission to allow rate increases despite a legislative freeze, said affects to residential and small business users are the big concern.
“If we go forward with deregulation, we have to have protections for the homeowner,” she said. “Which is what we required to be in place last session and yet it ended up being ignored.”
“I still don’t believe those deals are legal,” said Dini.
But he echoed Hettrick’s concern that the utilities not be left in a situation where they can’t survive financially.
“If we don’t solve the problem, we’ve got two busted major companies,” he said.
Hettrick conceded that total deregulation may not be possible because of the need to ensure there is enough power to serve people’s needs.
“I think the assumption was made in California and I think here that there was enough power. Something has to be done to ensure there’s generation – there’s going to end up being some regulation.”
Buckley said the entire deregulation law will have to get a second look.
“We’re going to be examining all those issues with the goal of making sure we have reliable, affordable electricity in everyone’s homes,” she said.
But she said that means utilities must answer some questions about how they set rates.
“We have to look at the whole, all of their operations to make sure the homeowner is not paying too much,” she said.
Dini agreed the small consumer must be protected, but added that Nevada’s two largest utilities, Sierra Pacific Power and Nevada Power, must also survive the process.
Townsend agreed small consumers, especially seniors on fixed incomes, must be protected from huge rate increases.
“It’s simple, you don’t let that happen,” he said.
And he said the state must find a way to “accelerate building of plants.”
He said those are the changes he expects to come out of the 2001 Legislature.
Guinn set a new deadline of Sept. 1 2001, for the start of deregulation. He has not yet named the bipartisan task force to study the issue.
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