Newspaper column: Those who once pushed for clean energy now balk at paying the price

Be careful what you so ask for. You just might get it — good and hard.

Return with us now to those thrilling days of the 2013 Nevada legislative session, when lawmakers, determined to save the planet from carbon dioxide-induced global warming by closing down all of the state electric grid’s coal-fired power plants, passed Senate Bill 123. Those coal plants would be replaced with clean renewable energy and natural gas-fired plants.

Some of the state’s biggest and most influential companies supported passage of SB123.

Josh Griffin, testifying on behalf of MGM Resorts International, told an Assembly committee: “I am here to support (SB123). As you all know and have heard here today, the piece of legislation in front of you represents thousands of hours of work by so many different interested parties, many of whom have already spoke. … We are proud to support the efforts in this bill.”

Crescent Dunes Solar Project

Richard Perkins, representing Wynn Las Vegas, chimed in: “As Mr. Griffin indicated, the large users in southern Nevada, particularly the gaming companies, participated with NV Energy working through the bill and finding compromise areas. We are here in support of the bill.”

At a Senate Committee hearing a letter was submitted on behalf of Las Vegas Sands Corp. signed by Andrew Abboud, senior vice president of government relations for the hotel-casino company. “Las Vegas Sands Corp. writes in support of the compromise reached by NV Energy and representatives of the Nevada Resort Association and the Southern Nevada Hotel Group on SB123. The legislation is essential to speeding up the closure of Nevada’s coal-burning electric facilities and enhances our state’s commitment to green energy,” the letter said.

An email form Virginia Valentine, president of the Nevada Resort Association, was placed into the record in support of the bill.

Other companies also supported the bill, which was being pushed hard by Sen. Harry Reid.

Earlier this year The Beacon Hill Institute at Suffolk University in Boston released a study of the economic impact of SB123 commissioned by the Nevada Policy Research Institute.

The study estimated the bill, between 2015 and 2025, would cost Nevadans $617 million dollars and destroy 2,630 jobs by 2020, while driving up electricity prices by nearly 3 percent. These costs are spread across the grid, whether one is a customer of NV Energy or not.

Now, fast forward to a Public Utilities Commission (PUC) of Nevada hearing earlier this month.

MGM, Wynn and Sands are all trying to exit the state’s monopoly grid and purchase power elsewhere at a lower cost.

At that hearing Wynn Resorts President Matt Maddox sharply criticized the power company, saying, “Nevada Energy made more net income ($354 million net income) than the Las Vegas Strip last year. You know where all that money went? Omaha.” That was a reference to the power company being purchased in 2013, after passage of SB123, by a Warren Buffett company.

While Maddox was testifying, MGM CEO Jim Murren was on public radio complaining about having to pay $86 million a year for power and talking about the firm’s attempt to buy cheaper power on the open market. “We’re not interested in subsidizing everybody who lives in our state on the backs of us overpaying for our power,” he said.

Former state Sen. Randolph Townsend also took the opportunity of the PUC hearing to criticize SB123. “(SB)123 was the greatest highway robbery I’ve ever seen coming through this state. I think it was a disaster,” he said.

At that PUC hearing commissioners denied a Las Vegas-based data storage company’s bid to pay a fee and exit the power monopoly, but indicated negotiation with that firm and the casinos could continue.

Another factor driving up the cost of power for everyone is a state law that mandates 25 percent of the state’s electricity be generated from renewables — such as solar, wind, biomass and geothermal — by the year 2025. Renewables cost three to four times as much as natural gas- or coal-fired power.

For example, the Crescent Dunes Solar Energy Project near Tonopah is scheduled to come online this year. The solar thermal plant, which will generate power by using a massive array of mirrors to melt salt to drive its turbines, has a 25-year contract to sell power at 13.5 cents per kilowatt-hour. That wholesale price is three and half cents higher than the residential retail rate in Northern Nevada.

Be careful what you ask for.

A version of this column appears this week in the Battle Born Media newspapers — The Ely Times, the Mesquite Local News, the Mineral County Independent-News, the Eureka Sentinel, the Lincoln County Record and the Sparks Tribune — and the Elko Daily Free Press.

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7 comments on “Newspaper column: Those who once pushed for clean energy now balk at paying the price

  1. And as stated before…these exorbitant electricity rates hurt those at the lower end of the spectrum the most…the poor, the working poor, the lower middle class and the middle class. All for the benefit of the “Oracle of Omaha”…a loyal supporter and confidant of our meddling Community Organizer in Chief.

  2. Rincon says:

    The Huffington Post sayss the study by Beacon Hill is bogus. Who do you believe?

    Koch Brothers Fund Bogus Studies to Kill Renewable Energy

    “To make its case, ALEC–whose members include major coal, oil and electric utility industry companies–cites analyses by Suffolk University’s Beacon Hill Institute commissioned by the Koch-funded American Tradition Institute and “free-market” state think tanks associated with the Koch-funded State Policy Network. The analyses examine current or proposed standards in more than a dozen states, including Colorado, Kansas, Michigan, Minnesota and New Jersey. The studies were partly funded by, you guessed it, the Koch brothers.

    The fact that the Kochs funded the studies doesn’t automatically mean they’re biased. In this case, however, Beacon Hill research economist Michael Head essentially conceded to Washington Post reporter Juliet Eilperin that he and his colleagues fudged their findings.

    That’s right.

    Beacon Hill, Eilperin reported, “assumed that the Energy Information Administration’s projected renewable energy price estimates are too low, and that cost-containment measures embedded in state policies will fail.” Head told her that he and his co-authors doubted the cost caps, which place a ceiling on how high monthly consumer electricity rates can go to meet renewable standards, would take effect. “We just left it out so we could provide the actual analysis of the policy itself,” he explained.

    How convenient.

    A closer look at a sample Beacon Hill analysis of a state renewable electricity standard shows that this sleight of hand is just one of a number of ways Head and his colleagues play fast and loose with the facts.

    Jeff Deyette, a senior energy analyst at the Union of Concerned Scientists (UCS), dissected a September analysis Head et al. did of a proposed increase in Michigan’s renewable electricity standard from 10 percent by 2015 to 25 percent by 2025, which was on the November ballot. Besides excluding the cost cap–a key component of the policy–Deyette found that the Beacon Hill analysts:

    • ignored the fact that the state already has a standard in place, enabling them to inflate the costs of implementing the stronger standard;

    • made questionable assumptions about renewable energy technologies–often citing out-of-date, controversial or unsubstantiated material to support their assertions–instead of using real-world cost and performance data from local projects; and

    • failed to factor in the new standard’s benefits, including economic development, job growth, cleaner air and reduced carbon pollution.

    Beacon Hill–an official sponsor of this year’s Heartland climate science-bashing conference–conducted this particular study for the Michigan-based Mackinac Center for Public Policy. The center, the largest state-based free-market think tank in the country, is a Koch grantee and a member of the Koch-funded State Policy Network. Not surprisingly, the center consistently denies the reality of global warming.”

    Funny how conservative and liberal think tanks always, and I mean always, conduct studies which support their preexisting political biases. They’re not think tanks. They’re propaganda machines.

  3. And so is the HuffingtonPuffington Post…

  4. […] Nevada’s lawmakers have already jumped off this cliff, deciding to shut down all the state’s coal-fired power plants no matter what the cost to ratepayers and the […]

  5. […] would be needed, but the Crescent Dunes plant sells power to NV Energy at a wholesale rate of 13.5 cents per kilowatt-hour, which is two to four times the cost from a gas-fired plant, a cost passed on to […]

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