“Let’s get ready to rumble!”
— Boxing ring announcer Michael Buffer
Nevada is known for its big fights.
Whether it was the epic 42-round lightweight championship in 1906 in Goldfield between Joe Gans and Oscar “Battling Nelson,” the heavyweight “Fight of the Century” in 1910 outside Reno between Jack Johnson and James J. Jeffries, or any of dozens of extravaganzas held on the Las Vegas Strip, the state’s history is festooned with fisticuffs.
In the political ring, the donnybrook over the fate of Nevada’s Energy Choice Initiative (ECI) figures to be one for the record books.
The statewide “Question 3” ballot initiative itself is straight forward. It proposes to change the Nevada Constitution to allow any business, resident or entity “the right to choose the provider of its electric utility service.” That includes maintaining its agreement with NV Energy or one of the state’s cooperative providers, seeking another available source, or self-generating electricity such as by rooftop solar. For that to happen, the initiative must pass two votes of the people and one at the Legislature before proceeding to the Governor’s desk.
Until just a few months ago, some observers would have called the fight a mismatch and practically no contest. The first ECI vote in 2016 passed by a staggering margin, 72 percent to 28 percent, with barely a grumble of opposition from either NV Energy or the organized labor unions that represent many of the employees of Nevada’s heavyweight power company. Major casino corporations such as Las Vegas Sands, MGM Resorts International and Wynn Resorts supported the measure. It appeared the people had spoken and were more than comfortable with the concept of deregulation, or at least the breaking of a virtual monopoly, in a time of dramatic change in energy production.
Officially, NV Energy stayed neutral in 2016 on Question 3. Although some large electricity consumers, including several major casino companies, were upfront supporters of Question 3 and were willing to pay millions to leave the power company. NV Energy appeared more focused on attempting to crush the growing popularity of rooftop solar. In the process, the 800-pound electricity gorilla looked like a schoolyard bully. It was an image that surely didn’t help when citizen ratepayers stepped into the voting booth.
But that’s the way it is when you’re the only game in most towns, and NV Energy wants to keep it that way. NV Energy Chairman Paul Caudill has made it clear the utility owned by the multibillionaire Warren Buffett will spare little expense – as much as $30 million, according to The Nevada Independent – to reverse the political polarity and defeat the constitutional question.
Question 3’s most vocal advocate without question is Switch CEO Rob Roy, who recently granted an intriguing interview with The Nevada Independent in which he effectively vilified NV Energy as a wasteful monopoly with far too much insider clout at the Legislature. In short, the power company no longer serves Nevadans’ best interests.
From the sound of things, NV Energy’s officials had better be light on their feet and show an ability to counterpunch against embarrassing developments, or that $30 million will be wasted.
Roy isn’t afraid to bloody a nose.
“If we don’t pass it this time, guys, they control the people, especially the little people in Nevada, for almost all of time. I can’t see how anything would ever come back and fix it in the future,” he said. “People need to understand that. They don’t need to be afraid of change. They need to be afraid of being stuck with the same old, same old. And, I’ll tell you why. They are not good at this. They are overcharging Nevada hundreds of millions of dollars. Something else has to come in and help, so that’s one. It’s an all or nothing moment. If ECI doesn’t pass, the monopoly has everybody.”
That may be true, but when I heard the name “Rob Roy” I can’t help but be reminded of the Scottish outlaw and folk hero who was portrayed inaccurately but romantically as a Robin Hood character in a Sir Walter Scott novel. When billionaires talk about what’s best for the little people, I can’t help but get a little nervous.
Not that NV energy has exactly been the working person’s friend. But one advantage NV Energy enjoys is brand recognition and a relationship with organized labor, whose workers keep its vast infrastructure humming. Expect the stories of those working Nevadans to become part of the NV Energy narrative in the weeks to come as it tries to win the hearts and minds of voters.
Nevada is not alone in pondering electricity deregulation. To varying degrees, it’s being tried in other states. Although Texas is considered the most wide-open system, according to energy websites, the playing field is evolving steadily. It’s an ongoing experiment in other states, and it represents a substantial shift in the power paradigm.
There’s no guarantee deregulation will work for citizen consumers, especially those in sparsely populated rural communities, but what is certain is that it’s officially on NV Energy’s political radar in 2018. It’s also true that NV Energy’s rates are lower than some other western states.
It had to be dragged into the 21st century on the issue of renewable energy, made a mistake in trying to squash rooftop solar, and some would argue has opened the door to the changes inherent in Question 3.
From my seat in the grandstands, NVEnergy’s biggest challenge will be blocking punches about its use of ratepayer funds for purposes outside its mission. When those questions are raised, as I believe they will be, they should be answered in public.
Consumers are already inclined to think twice before taking NV Energy at its word – and that could spell trouble for the power heavyweight in November.
John L. Smith is a longtime Nevada journalist. Contact him at jlnevadasmith@gmail.com On Twitter: @jlnevadasmith.
