Nevada had the thirteenth smallest population and the fifteenth lowest utility generating capability in 1996.  Nonutility capability as a share of total generating capability was relatively large at 11.7 percent, the thirteenth highest total in the United States.  At an average cost of 5.95 cents per kilowatthour, the price of electricity in Nevada was the nineteenth lowest in the United States, well below the national average cost of 6.86 cents per kilowatthour.

The State has a significant amount of generating capability fired by coal, gas, and hydroelectric sources, but no nuclear generating units.  Half is coal-fired, 31 percent is gas-fired, and almost 20 percent is hydroelectric.  This can be attributed to Nevada’s close proximity to western coalbeds, to Pacific gas resources, and to its share of the Hoover Dam, the second-largest hydroelectric generating station in the Nation, as well as other hydroelectric facilities.  (Although the Dam is actually larger than Southern California Edison’s coal-fired Mohave plant, for purposes of this report it does not outrank Mohave because Hoover’s capability, generation, and other statistics are split equally between Nevada and Arizona since the Dam and its peripheral holdings and property are located on the border between both States.)  Even split in half, Hoover Dam’s net capability ranks it as the second largest plant in the State.  The third and fourth largest plants, Clark which is gas-fired and Reid Gardner which is coal-fired, are operated by the Nevada Power Company, the utility with the largest generating capability in the State.  Most of Nevada’s largest plants, no matter the fuel source, lie in relatively close proximity to each other in the southeastern part of the State near Las Vegas.

Nevada’s coal-fired electric utilities receive most of their coal (64 percent) from the Black Mesa coal field in northeastern Arizona.  There is a unique transportation link between the mine in Arizona and the Mohave power plant in southeastern Nevada.  It is a 273-mile long, 18-inch pipeline which is the only long-distance slurry pipeline in the Nation.  Coal is delivered as a slurry—a  mixture  of  half  finely ground  coal  and  half water, by weight—and is pumped at a rate of about 3.5 miles per hour.⁽¹⁾ Another 32 percent of coal shipped to the State’s utilities was mined in Utah and delivered by railroad.  The remaining 4 percent was mined in Wyoming and Colorado and also arrived by railroad.⁽²⁾

In 1986, coal units represented 48.3 percent of Nevada’s utility generating capability and 73.0 percent of its utility net generation.  In 1996, the coal share of capability rose to 49.7 percent, while the net generation share had fallen to 68.6 percent.  Gas capability and generation, on the other hand, were 20.5 percent and 2.8 percent respectively, in 1986.  By 1996, the gas shares had risen to 30.9 percent and 20.9 percent, respectively.  Retail sales by Nevada utilities almost doubled when comparing 1996 levels with those of 1986.

Like all States west of Kansas, Nevada had no generating units that were cited in Title IV of the Clean Air Act Amendments of 1990 to begin compliance with stricter emissions standards for sulfur dioxide and nitrogen oxides.  In fact, the concentration of these pollutants as well as carbon dioxide in the State caused Nevada to be ranked as one of the 10 lowest emitters in the Nation.

Nevada has been one of the leaders in the move toward a deregulated environment for electricity.  The fact that there is no nuclear power in the State and, therefore, minimum stranded costs, may account for the rather aggressive approach to restructuring Nevada’s electric power industry. Legislation was passed in July 1997 that directs the State’s Public Utility Commission (PUC) to establish a market in which customers have access to potentially competitive electric services from alternative suppliers no later than December 31, 1999.  In June 1998, the PUC issued an order that defines which utility-related services, aside from selling electricity, could be open to competition.  These areas include metering, billing, and customer service.  In July 1998, Sierra Pacific and Nevada Power filed a joint merger application with the PUC wherein the utilities proposed to sell their generation assets.  They filed their application with the Federal Energy Regulatory Commission in October 1998.⁽³⁾

Endnotes