NV Energy alleges competitor encroaching on its territory
31 January 2013
NV Energy is trying to quash a utility contract of a much smaller power company, claiming the nonprofit Valley Electric Association is encroaching on its territory at Creech Air Force Base.
Nevada’s largest power company filed a complaint this month with the state Public Utilities Commission, alleging Valley Electric’s 50-year, $23.6 million deal to provide distribution services at Creech violates state law.
NV Energy provides power to the Indian Springs military base — known for its pilotless “drone” aircraft — and wants the commission to order Valley Electric "to cease and desist from any operation” there.
It also wants the PUC to block the co-op from extending service elsewhere in NV Energy’s service territory and to levy any penalties or relief it sees fit.
The Jan. 18 complaint was made the same day it filed a petition with the PUC claiming the U.S. Department of Energy — which signed a five-year, $61.6 million deal with Valley to provide electric services to the Nevada National Security Site starting Nov. 1 — owes NV Energy money for canceling a contract to buy power for the site.
Both filings came after Valley Electric pulled out of a NV Energy-controlled power distribution district. Valley Electric had been paying NV Energy about $300,000 per year in tariffs to be part of its “balancing authority area.”
Valley Electric CEO Tom Husted described the recent filings as “retaliatory measures” in response to Valley getting the two federal contracts and for exiting the balancing area to join the California Independent System Operator Corp.
According to Husted, Valley Electric has had a “combative relationship” with NV Energy since the 1960s.
“We believe that their (recent) actions are deplorable, and this is just a prime example of why they’re not a good business partner for the state of Nevada,” Husted said.
NV Energy spokesman Rob Stillwell denied that the filings were retaliatory. He said the company wants the PUC to determine if Valley Electric violated state law with the Creech contract, as Valley does not have a commission-issued service certificate for the base.
Husted declined to comment on that claim, saying he wouldn’t discuss the “merits” of the dispute until his group responds before the commission.
Creech officials had been slated to turn over their electric distribution facilities to Valley last Sunday, according to the utility’s Nov. 12 announcement of the deal. Under the contract, Valley would maintain and operate the facilities for the next five decades.
The hand-over date has since been extended to June 1, because of ongoing construction work there, Husted said.
Las Vegas-based NV Energy serves 2.4 million Nevada residents, about 90 percent of the state’s population. Valley Electric, based in Pahrump, has more than 17,000 members in Nevada and California, though most are in the Silver State.
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