Nevada utilities want to borrow up to $400 million

By JOHN G. EDWARDS

Oct. 17, 2000 (www.lvrj.com)—Nevada's two major electric utilities are asking state regulators to authorize them to borrow an estimated $350 million to $400 million more to cover the rising cost of wholesale power and fuel for power generation.

Sierra Pacific Power Co. and Nevada Power Co. each year ask the Public Utilities Commission to authorize them to issue bonds and stocks, explained Mark Ruelle, chief financial officer for Sierra Pacific Resources, the utilities' parent.

During the next year, electric power companies estimate they will need to borrow $350 million to $400 million more next year to cover the increasing cost of fuel and wholesale power.

"All of our other costs are down," Ruelle said. In a related development Friday, the companies asked the PUC to approve another round of monthly rate increases to offset some of the costs of fuel and wholesale power. Nevada Power, which serves the Las Vegas area, is asking the state to allow it to boost rates by $15.8 million or 1.4 percent yearly starting Dec. 1.

Residential rates would be boosted 1.3 percent or $1.04 a month. In July, the PUC approved a so-called "global settlement" agreement reached by state officials, the utilities and major casino operators for deregulation and rate increases. Since that agreement, Nevada Power has filed to raise rates by a total of 10.3 percent for residential customers.

Sierra Pacific Power, which serves Reno, seeks to boost rates of all customers by $1.4 percent or $7.7 million in its latest rate case. While customers may complain about continuing increases, the PUC staff believes the rate increases would have been higher had the agreement not be reached. Nevada Power's annualized increase would have been $90 million higher had the settlement not limited the amount of monthly increases the utility can receive, according to the PUC staff. Sierra Pacific Power would have been able to recover $3.5 million more.

The electric utilities may have an opportunity to recover some of those expenses later. Because of the rising cost of fuel and purchased power, the two utilities are seeking state authorization to borrow $100 million more from banks and Wall Street on a short-term basis, Ruelle said. They are seeking authorization to borrow $1 billion more on a long-term basis.

About one-third of the $1 billion in long-term debt authorization would be used for refinancing existing debt, Ruelle said, with the remainder going for additional or new debt. Ruelle said the companies don't intend to borrow the maximum amount authorized in short-term and long-term loans at the same time. A decision by the PUC to approve increased borrowing won't guarantee that the company is able to recover the extra amount through rate increases, he said.

Copyright © Las Vegas Review-Journal, 1997 - 2000

Sponsored by FLSmidth

Related Articles

Fuel Tech receives air pollution control contracts worth $3.6Mn

Fuel Tech Inc. has received multiple air pollution control (APC) contracts, worth approximately $3.6 million, from customers in China, Europe and the U.S.

Video: Duke Energy acquires Halifax Solar Project in North Carolina

Duke Energy Renewables (NYSE: DUK) has acquired a 20-MW solar project in Roanoke Rapids, North Carolina, from Geenex and ET Solar Energy Corp.

Follow Power Engineering on Twitter

Latest News

02-25 Henry Hub Average Natural Gas Spot Prices

02/25 Henry Hub Average Natural Gas Spot Prices

The Henry Hub is the pricing point for natural gas futures contracts traded on the New York M...
 GDF Suez wants Areva to deliver nuclear reactors, wind turbines

GDF Suez wants Areva to deliver nuclear reactors, wind turbines

GDF Suez says it received guarantees from Areva for planned nuclear reactors in Turkey and wi...
 CB&I: We’re not liable for $247mn nuclear power project penalties

CB&I: We’re not liable for $247mn nuclear power project penalties

Chicago Bridge & Iron (CB&I, NYSE: CBI) say they should not be liable for any of the ...
 Siemens upgrades I&C system of GE steam turbines for first time

Siemens upgrades I&C system of GE steam turbines for first time

Siemens (NYSE: SI) received an order to upgrade the instrumentation & controls (I&C) ...
 Weekly Coal Production

Weekly Coal Production

The Weekly Coal Production Report has been updated for the week ended February 21, 2015.

 North Dakota coal production increases 4 percent in 2014

North Dakota coal production increases 4 percent in 2014

North Dakota is known for its booming oil fields, but coal mining in the state also is a heal...
 Spanish company buying US utility serving northeast for $3B

Spanish company buying US utility serving northeast for $3B

Spain's leading electricity and natural gas utility, Iberdrola, says it will buy the northeas...
 Ohio utility regulators reject AEP plan for coal plants

Ohio utility regulators reject AEP plan for coal plants

Ohio utility regulators have rejected an American Electric Power proposal to guarantee profit...

Power Engineering Current Issue

03/01/2014
Volume 118, Issue 3
1403PE-cover

Products Showcase

Dynamic Fluoride Ion cleaning DFIC of industrial natural gas turbines Hi-Tech Furnace Systems

Dynamic Fluoride Ion Cleaning of IGT Parts

The Dynamic Fluoride Ion Cleaning (DFIC) Process from Hi-Tech Furnace Systems is able to clean deep, narrow cracks of oxides by cycling between negative, atmospheric, and positive pressure.

Archived Articles

2000 | 2001 | 2002 | 2003 | 2004 | 2005 | 2006 | 2007 | 2008 | 2009 | 2010 | 2011 | 2012 | 2013

Power Industry Wire News

REMINDER: Scorpio Tankers Inc. Announces Fourth Quarter and Year End Earnings Release Date and Conference Call Details

REMINDER: Scorpio Tankers Inc. Announces Fourth Quarter and Year End Earnings Release D...

Mountain High Acquisitions to Acquire Freedom Seed and Feed, the First Federally Permitted Hemp Seed and Fiber Farm in the USA

Mountain High Acquisitions to Acquire Freedom Seed and Feed, the First Federally Permit...

NW Natural Reports 2014 & Q4 Results

NW Natural Reports 2014 & Q4 Results

Babcock & Wilcox Ends 2014 on High Note With Solid Bookings, $5.3 Billion Backlog, an Industrial Info News Alert

Babcock & Wilcox Ends 2014 on High Note With Solid Bookings, $5.3 Billion Backlog, an I...

Western Gas to Present at Upcoming Barclays Investment Grade Energy and Pipeline Conference

Western Gas to Present at Upcoming Barclays Investment Grade Energy and Pipeline Confer...

Power Engineering

Article Archives for Power Engineering Magazine

Continuing Education

Professional Development Hours

To access a course listing associated to a specific topic listed below, click on the topic of choice from the list below.

Latest Energy Jobs

View more Job Listings >>