Townsend and Guinn sell out Nevada ratepayers


Expanded from the 6-3-2001 Sparks (Nev.) Tribune

"As long as we're in this time of dwindling supply, I'll not consider deregulation."
-- Kenny Guinn

Thus spake Gov. Dudley Do-Right last Friday night in a television interview taped within the past several weeks. Too bad his word's no good, but where money and power (electrical and political) are concerned, what's a few lies between friends?

With the ink barely dry on his signature of AB 369, the bill repealing Nevada utility deregulation, the guv is supporting legislation to let the genie back out of the bottle -- but only for big boys like mining and gambling.

During a break last week, Guinn entered the state senate floor and spoke with Majority Leader Bill Raggio, R-Reno, who then apparently ordered Sen. Randolph Townsend, R-Reno, to take down a proposed amendment to Assembly Bill 661. The proposed amendment would revive the substance of Assembly Bill 349, a $10 million program to help low income families pay energy bills. That proposal failed to achieve the required two-thirds senate majority and thus died a few days ago.


In a May 19 meeting with the Nevada Utility Reform Alliance (NURAy), Townsend stated that he would support nothing opposed by Nevada Consumer Advocate Timothy Hay regarding AB 661. Nonetheless, the Senate Committee on Commerce and Labor, which Townsend chairs, voted 7-0 to strip all consumer provisions from the bill, leaving only renewed deregulation of casinos, mines and other large power users.

Townsend told me Wednesday that he will try to reinstate some consumer provisions, such as a long overdue audit of Sierra Pacific/Nevada Power, in the conference committee process used to resolve differences between the assembly and senate.

Also on Wednesday, Hay sent a letter to all 21 senators opposing AB 661 in its current form. The bill "permits the large (and low cost) industrial users to leave the utility and forces the remaining, captive customers to pick up what easily could be increased system costs," Hay wrote.

If AB 661 passes, it will allow the equivalent of an apartment landlord losing a major number of renters with no way to replace them. The remaining tenants would thus be stuck with geometric rent increases to pay the landlord's mortgage and operating expenses.

Nevadans will face a parallel situation if forced to pay for the utilities' embedded or "sunk" or "stranded" costs (the power company equivalent of empty apartments). Ironically, Sen. Townsend's 1997 deregulation bill, repealed in April with Guinn's signature of AB 369, was supposed to have protected ratepayers against stranded costs. AB 661 does not. Unlike tenants, Nevada ratepayers cannot move to a new apartment house unless they leave the state entirely.

Sen. Joe Neal, D-North Las Vegas, told the Alliance at its March 17 meeting that Townsend's 1997 bill was written by an Enron lobbyist working out of Townsend's senate offices.

Enron has since emerged as the most predatory of the Texas-based electricity producers. Its chairman, Kenneth L. Lay, was recently accused of threatening to use his influence with President Bush to block the reappointment of Federal Energy Regulatory Commission Chairman Curtis Hebert, Jr., if Hebert did not endorse Enron's support of expanded deregulation. (New York Times, 5-25-2001, front page)

Lay recently attended a secret meeting to push influential California Republicans, including Arnold Schwarzenegger, to support preservation of the state's deregulated power market. (San Francisco Chronicle, 5-26-2001)

Nevada is quickly becoming a power farm for California. The Silver State's air is largely so clean that new generating plants can be built without violating federal standards. Such a facility is due to go online east of Reno in Storey County this month. It was built utilizing six inefficient turbines from Japan which were obsolete a decade ago. Where most utility plants have an expected life of 20 to 30 years, this one has been built to last two years, perhaps three at most.

Its sole purpose is to gouge Californians by offering exorbitantly priced power at peak load times. It sits in our midst like a patient predator, waiting to pounce if AB 661 places Nevada back on the path of California.

The above facts explain Gov. Guinn's evasive answers, below. Townsend's help-the-needy amendment to AB 661 is mere sugar-coating for a bitter pill, a cruel and cynical ploy to force Assembly Majority Leader Barbara Buckley, D-Las Vegas, and others to vote for renewed deregulation or lose the critically needed aid.

Townsend pulled the bill off the calendar both Friday and Saturday because he couldn't muster enough votes. On a live interview on KOLO TV-8 Friday morning, casino lobbyist Harvey Whittemore arrogantly predicted Townsend's moves, which tells you all you need to know about who's really calling the shots. (The bill has been placed on the senate agenda for the session scheduled to begin at 10:00 a.m. PDT Sunday, June 3. The time may vary. You can view or listen at the legislative website.)

JUMPING JACK FLASH. The puff TV show noted above featured Reno lawyer Bill Prezant lobbing marshmallows to two utility executives, Sierra Pacific Powerful boss Walt Higgins and former Southwest Gas CEO Kenny Guinn. Prezant posed a question submitted by Associated Press Carson City Bureau Chief Brendan Riley.

If Nevada opens itself up to a plethora of powerplant construction in exchange for reserving half the production for in-state use, what pricing safeguards for Nevadans will come with it? Guinn replied with confusing jargon and never answered the question. Prezant did not press him.

By saying nothing, the governor actually provided a truthful answer.

Nothing it is.

IT'S A GAS, GAS, GAS. The program was officially named "Nevada Profile: Energy." I prefer the title listed by TV Guide: "Freakylinks."

Be well. Raise hell.


Continuing updates at the Nevada Energy Crisis War Room.

NevadaLabor.com | U-News | C.O.P. | Sen. Joe Neal
Guinn Watch | Deciding Factors | Contact Legislators


© Andrew Barbano

Andrew Barbano is a 32-year Nevadan, a member of Communications Workers of America Local 9413 , editor of NevadaLabor.com and JoeNeal. org/

He managed Sen. Townsend's 1980 initiative petition which forced the 1981 Nevada Legislature to establish Nevada's first office of consumer advocacy. He lobbied the 1981 session on utility issues and coordinated intervention in five cases before federal and state utility regulatory bodies. He is a member of NURAy.

Barbwire by Barbano has originated in the Sparks (Nev.) Tribune since 1988.

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