PUCN Dismisses NV Energy Complaint in Creech Air Force Base Dispute

PAHRUMP, Nev. – Valley Electric Association Inc. (VEA), a member-owned electric cooperative serving more than 45,000 consumers in southwestern Nevada, achieved a significant victory, as the Public Utilities Commission of Nevada (PUCN) formally dismissed a complaint filed by NV Energy in response to VEA’s $36.6 million contract to purchase, maintain and operate the electric distribution infrastructure at Creech Air Force Base.

The PUCN found that NV Energy was incorrect in its allegation that VEA violated state law by providing electric distribution services to Creech Air Force Base. VEA, a Pahrump-based cooperative, does not sell electricity to Creech Air Force Base and does not operate as the electric service provider for the base.

NV Energy continues to provide electricity to the base. In an order issued today, the PUCN states it has seen no evidence to indicate that VEA’s operation interferes with NV Energy’s ability to provide service to Creech Air Force Base.

“It is important to note that VEA earned the privilege to serve Creech Air Force Base through an open, fair and competitive process,” said Tom Husted, CEO of VEA. “We were, to the best of our knowledge, the only Nevada-based company to bid on this contract.”

The Defense Logistics Agency awarded the contract to VEA on Sept. 28, 2012, and VEA began providing distribution services to Creech Air Force Base on June 1, 2013.

NV Energy filed the complaint in January, alleging VEA’s federal contract violated four provisions of the Nevada Revised Statutes, including interfering with NV Energy’s system and operating a public utility without a certificate of public convenience and necessity within NV Energy’s exclusive territory, in addition to other allegations related to duplicating service and providing service to non-members. By dismissing the complaint, the PUCN found that VEA did not violate any of these statutory provisions.

“While we disagree with NV Energy’s decision to file the complaint, we believe this situation serves to highlight the importance of VEA’s longstanding goal to improve collaboration among utilities in the region,” Husted said. “We hope to put these types of challenges behind us and move forward to build a brighter future for the region as a whole.”

VEA remains a strong supporter of expanding the regionalization of the Western transmission grid, which Husted said would require cooperation among utilities to improve efficiencies and reduce costs for ratepayers in the region. This parallels VEA’s move to join the California Independent System Operator Corporation (CAISO) balancing authority in January.

In April, the PUCN also denied a petition put forth by NV Energy in response to VEA’s $62 million contract to provide electric service for the Nevada National Security Site (NNSS). This contract had previously been held by NV Energy.

VEA has expanded its workforce by nearly 25 percent since 2012 to accommodate the contracts for NNSS and Creech Air Force Base, in addition to other new opportunities. The revenue from these new contracts also helped VEA avert double-digit rate increases for approximately 45,000 people within its service area.

“Our cooperative wants nothing more than its fair chance to promote economic development in the region, provide more jobs in our home state and offer reliable service to our members,” Husted said. “We look forward to continuing our mission of serving as a trusted business partner for Nevada and its residents.”

Although VEA agrees with the PUCN’s decision to dismiss the complaint related to Creech Air Force Base, Husted said the commission’s order contains inaccurate and unsubstantiated language that includes unfair assumptions about VEA’s contract to provide electric distribution services to the base.

“VEA’s contract to serve Creech Air Force Base came after months of careful planning and deliberation,” Husted said. “We went to great lengths to ensure the contract would not put our members at risk or violate the terms of our certificate of public convenience and necessity. Today’s decision by the PUCN is further evidence that VEA is well within its right to serve as a trusted contractor for this vital defense facility.”

About Valley Electric Association

Valley Electric Association Inc. (VEA) is a member-owned nonprofit electric utility headquartered in Pahrump, Nev. While VEA started as a small rural electric utility in 1965, the company now provides service to more than 45,000 customers within a vast 6,800-square-mile service area located primarily along the California-Nevada border, with the majority in Nevada. VEA’s service area starts in Sandy Valley, southwest of Las Vegas, and extends north for more than 250 miles to Fish Lake Valley. For more information about VEA, please visit www.vea.coop.