Nevada voters will go to the polls November 8 with more than the choice of the country's next president on their ballot. A ballot measure supported by the Las Vegas casinos would amend the state constitution to direct the Nevada legislature to create rules enabling the end of monopoly electric utility service. A second vote would be required to finalize the constitutional amendment and open the Nevada electricity market to competition.
The ballot measure is opposed by the Nevada branch of the AFL-CIO which has 200,000 workers in the state. The union's concern is that the proposed deregulation of the Nevada electricity market would lead to higher utility bills and potential job cuts. The state's largest utility, NV Energy, has remained neutral on the proposal while informing Nevada state legislators that potential price increases with attendant job losses are a possibility if the measure passes.
In Ohio, the specter of re-regulating the retail electric utility industry has arisen. Both FirstEnergy and AEP have struggled lately with cost recovery issues for aging baseload generation facilities. On October 12, 2016, the Public Utilities Commission of Ohio (PUCO) approved a new "distribution modernization rider" for FirstEnergy enabling the utility to recover $204 million from ratepayers through the rider. The PUCO's rationale for approving the rider was presented by the Chairman, Asim Haque, who acknowledged that the approval was "undoubtedly unconventional" in a deregulated market but was intended to enable FirstEnergy to modernize its system in a financially viable manner.
For its part, AEP determined that the best course of action was to sell some of its generation facilities and push for re-regulation of the Ohio electric utility market. Whether Ohio re-regulates its electric market remains to be seen while out west, Nevada voters consider the potential benefits of deregulating the electric market. November 9 may be the dawn of a new open market in Nevada for electric utility customers while their counterparts in Ohio consider a return to a regulated utility market. Stay tuned.
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