Nevada Power chief says legislative shield should expire
LAS VEGAS — Nevada Power will not ask state legislators to extend a law shielding it from a hostile takeover by another government agency, company president Pat Shalmy said.
But despite a $3.2 billion purchase offer from the Southern Nevada Water Authority, Shalmy said again that the financially strapped electric utility company is not for sale.
Nevada Power parent Sierra Pacific Resources has not responded to the bid.
“I would rather not go to the Legislature with something contentious right now,” Shalmy said in a television interview this week.
After Clark County voters in November approved an advisory referendum favoring a takeover by a nonprofit electric utility, Shalmy said Nevada Power would take the takeover fight to the Legislature.
This week, Shalmy said Nevada Power won’t ask lawmakers to renew the bill that expires June 30. The bill prevents government agencies from a hostile takeover of a privately owned electric, natural gas and telecommunications utilities.
The water authority has argued that it can offer consumers electricity at lower cost than the electric company, because the authority has a better bond rating and can borrow money at a lower rate than Nevada Power.
The electric company has argued that it has provided reliable service to southern Nevada for nearly 100 years and there is no evidence the water authority could do it better.
Clark County is the core of Nevada Power’s 640,000-customer area.
Nevada Power spokesman Jack Leone told the Las Vegas Sun on Tuesday that, beyond SB425, other laws would make it difficult for a hostile takeover of Nevada Power.
However, state Consumer Advocate Timothy Hay said a takeover would be an option without the bill.
Water authority spokesman Vince Alberta said he agreed that the bill should expire, but called it too early to determine whether that would make it easier to acquire Nevada Power.
“We think it’s the right thing to do to let the bill sunset,” Alberta said.
Peggy Maze Johnson, head of a group that pushed to pass the November ballot measure, said she favors letting another agency consider taking over Nevada Power.
Nevada Taxpayers Association President Carole Vilardo headed a campaign to defeat the ballot measure, saying it was vaguely worded.
She said she pushed for passage of the bill two years ago because the possibility of deregulating retail electricity had tax implications that had not been clarified in state law.
But she said proposals will be introduced next month to address taxing electricity brokers in other states and letting governments continue to collect their share of taxes even after a utility takeover.
Nevada Power contributes about 2 percent of the property tax revenue the Clark County School District uses to retire its construction bonds, Vilardo said.