I'm Shocked By This,
by Vice President Knight Allen
Originally published on October 8, 2015 - reprinted with permission
This is a
written version of the presentation I made to the Nevada Public Utilities
Commission (PUC) on September 22, 2015.
Good afternoon Commissioners.
My name is Knight Allen. I am a private citizen. Before I begin I'd like to offer a disclaimer: I have never
owned a share of Nevada Power Co. (NVP) stock nor did I own any shares after they changed their name to NV
Energy (NVE). Also, I own no shares of Berkshire Hathaway stock. Who can afford to? I come before you only as
a ratepayer with no hidden agenda.
I wish to speak to you on the subject of building power plants.
It seems to me we are heading down a road best described by that great American philosopher Yogi
"It's deja vu all over again."
Very few people in this room can remember back to 1999-2001 and the great energy deregulation debate.
Should NVP lose its fully integrated structure and be broken up? Where should the ever growing need for
electricity here in Southern Nevada come from? Should it be generated here? Bought from other sources
in the open market?
For several years NVP pointed out to the PUC that they were actually generating less and less of the
electricity themselves and asked to be allowed to build power plants to up the percentage of electricity
generated here in southern Nevada. The PUC consistently denied those requests. There were, at least short
term, good economic reasons for the PUC's position. First, power plants cost money. A lot of money and
those costs go onto the electric bill. Second, it turned out it was cheaper to buy the electricity on the
open market. So why invest billions in power plants? This policy worked very nicely - until it didn't.
When the electricity markets went completely haywire in 1999-2000 the error in not generating our own
electricity became painfully and dangerously evident.
The bottom line is that, basically, two people: Governor Kenny Guinn, who as a former utility executive
knew energy markets far better than most, and Ms. JoAnn Kelly, who Gov. Guinn appointed as Chair of his
Energy Policy Committee and who represented the interests of the people against the corporate interests
salivating for deregulation kept us from going over the cliff. Subsequently
NVP/NVE has built power plants
and now generates a much higher percentage of electricity right here.
I respectfully submit to you that if NVE can make even the weakest case to build the power plant they
want - even if it's only a 3 or 4 on a scale of 0-10 let them build it. Yes, I will grumble about the cost
right along with my fellow ratepayers here in the room behind me but, truly, this is one area where we really
don't want to experience deja vu all over again.
Vice-President Knight Allen
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