Our View: Put deregulation on a shelf

In Nevada, electric deregulation isn't working even before it has begun.

At least Nevada customers haven't faced the runaway costs that Californians experienced since deregulation there took effect in 1998. San Diego Gas and Electric Co. customers saw their bills rise 200 percent this summer, partly because of a heat wave.

However, events in the last two months cast further doubt that Nevada is prepared for - or should even be considering - deregulation of the power utilities.

Gov. Kenny Guinn, who already delayed the beginning of deregulation in March, should throw a blanket over the issue until the Legislature convenes in February. It is clearly a different game today.

Power companies gambled in 1999 that their costs would go down, so they agreed to legislation that would freeze residential customers' rates for three years.

Instead, their costs went up. So they engineered a settlement that sidesteps the 1999 legislation and allows for rate increases - every month, if that's what the power companies need.

Residential customers are being told they should accept the settlement, because it does put a cap on rate increases and would help Nevada avoid the runaway prices that shook California.

But several legislators have questioned the settlement, and so do we.

Significantly, it seems to confirm the ability of power companies and the state Public Utilities Commission to broker a deal without regard to Nevada law. That's not just bad policy, it almost certainly sets up a Supreme Court challenge.

Who wants deregulation of the electricity marketplace? The power companies and the major users, such as casinos. So far, nobody has given us a good reason why the average homeowner should favor it.

All we're looking for is some protection from skyrocketing rates. That's the job the Legislature did in 1999, and the job we expect it to do again in 2001.

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