LAS VEGAS (KSNV MyNews3.com) – NV Energy residential customers will receive an average $13 credit early next year as part of the potential purchase of the utility by Warren Buffett and MidAmerican Energy.
In addition, an agreement filed today stipulates that NV Energy customers will not have to pay for $1 billion of MidAmerican’s expected costs to purchase NV Energy.
Buffett agreed in May to buy NV Energy for $5.6 billion. Shareholders have $3.6 billion in equity. MidAmerican had planned to pass on the $2 billion difference to customers.
The proposed settlement, involving NV Energy, the Bureau of Consumer Protection and the PUC staff, is a response to an Oct. 28 regulatory filing by the state Bureau of Consumer Protection and other parties that called for a $30 million NV Energy rate reduction. The filing called for the utility to cancel its plans to pass on half of a $2 billion acquisition premium to ratepayers.
The Bureau of Consumer Protection stepped in for ratepayers last month when it filed on objection to the original deal.
"In our position that was filed with the commission we argued for no recovery from ratepayers of the $2 billion acquisition premium and requested a $30 million rate reduction," BCP spokesman Eric Witkoski wrote to News3 in an email today. "Since then we have been in negotiations with MidAmerica regarding the proposed transaction and negotiated a settlement where they agreed not to seek recovery of the $2 billion acquisition premium and agreed to a $20 million rate credit to consumers."
Also in the proposed settlement is making permanent a program to allow customers to pay extra to avoid having a smart meter determine their electric usage. The opt-out plan had been temporary.
Those are some of the highlights in paperwork filed today with Public Utilities Commission as the proposed sale moves closer to being finalized.
PUC hearings on the sale of NV Energy will begin Nov. 18. The sale of the utility is expected to be completed in early 2014. The PUC must grant its approval.
If the transaction is approved, ratepayers in Nevada will receive a credit averaging $13 within 30 days of the approval, according to NV Energy spokeswoman Jennifer Schuricht.
“That’s part of the $20 million credit as part of the overall purchase,” Schuricht told News3. “In southern Nevada that will be an average of $13 per residential customer and that should come in January or February pending the date of approval. The $2 billion in acquisition costs will never be passed on to ratepayers.”
Other stipulations in the agreement include that NV Energy senior managers will not receive raises for two years after the close of the sale, and that the corporate headquarters for NV Energy will remain in Nevada.