Even though electricity is one of the key considerations for companies looking to locate in Nevada, don't expect a flurry of activity after Sierra Pacific Power Co.
said it seeks to keep rates essentially unchanged during 2003.
The bigger question, folks in the industrial development business said last week, is the availability of power and that's a concern that Sierra Pacific's parent company shares.
In its annual filing with the Nevada Public Utilities Commission last week, Sierra Pacific asked for a rate increase so small one tenth of one percent that it's almost invisible.
The increase, if granted by the PUC, would add 6 cents a month to a typical residential bill.
That's good news, particularly for the power-hungry plastics producers and other manufacturers who increasingly look to Nevada.
"If a company's primary cost is electricity, price can be a dealmaker or a dealbuster," said Chuck Alvey, president of the Reno-based Economic Development Authority of Western Nevada.
If Nevada's power costs scare off potential new employers, Alvey said that usually happens early in the process when companies are doing the homework that precedes visits to possible locations.
He said, however, that EDAWN officials sometimes are able to show that the northern Nevada climate will help cap a manufacturer's electric costs even if rates don't compare favorably.
For instance, Alvey said, a plastics manufacturer might need to operate chillers for fewer hours during the day because of the cool nights in the region.
But industrial developers said reliability of electricity more often is a bigger issue than price.
"They want to be sure we have a source of power that isn't on and off," said Ron Weisinger, executive director of the Northern Nevada Development Authority in Carson City.
Weisinger said the companies with which he's been in contact have been satisfied with the answers they get from Sierra Pacific.
The power company, worries about future supplies and whether it can keep prices stable.
Walter M.
Higgins, chairman, president and CEO of Sierra Pacific Resources, said in a prepared statement last week, "We still have concerns about the future of Nevada's energy supplies and the potential ramifications if our state does not become more energy self-sufficient." If Nevada doesn't add generating facilities to meet its growing needs, Higgins said, it must rely on the wholesale power markets that proved to be highly volatile in 2000 and 2001.
The power company official said Sierra Pacific Resources wants to work with state leaders to resolve the dilemma.
The rate filing from Sierra Pacific last week is required annually under state law.
Each year, the company calculates the increases and decreases in its costs for fuel to purchase power from elsewhere.
The increases and decreases are held in a balancing account, and the changes are passed on dollar-for-dollar to customers.
