Out-of-State
electric companies lambasted
for another Mohave
Station postponement
LA DWP, Edison snubbed Public
Utilities Commission of Nevada on 2015 law requiring listing of surplus assets
to be sold for economic development
LAUGHLIN – The owners of the former Mohave Generating
Station were blasted on April 11 at the Laughlin Town Advisory Board meeting
for yet another postponement of announcing a buyer for 80 percent of the
4-square-mile site in the middle of town.
Representatives of Southern California Edison, Nevada
Energy, and sales agent CBRE of Las Vegas – but not the Los Angeles City
Department of Water and Power -- spoke to a large audience at the Clark County
Regional Government Center in Laughlin to give their excuses for once again
failing to meet their publically-announced deadlines, saying there were no
buyers. They did cite the first week in May for their next “progress” report.
Notably, the utilities have pushed a sale deep into the
Nevada Legislature’s biennial session when it is difficult, if not impossible,
to get bills introduced.
The non-sale ties directly into proposed SB-347 that would
correct not having any penalty for violating a 2015 Nevada law that required
in-state and out-of-state electric companies (no matter what facilities they
used to generate and transmit the power) to give the Public Utilities
Commission of Nevada a list, by category, of the status of each such asset if
it is more than 50 acres.
Those which are surplus – vacant, such as the former MGS, and
not in an active reserve status – are required to get with the Governor’s
Office of Economic Development to actively sell the property within 3 years. No
utility submitted such a list, GOED confirmed with the PUCN. One estimate puts
the number of such parcels throughout Nevada at 1,400, although it is
impossible to obtain a full count until they do.
When the 2015 law was passed the owners told the State Legislature
and Laughlin residents they would have an on-site representative living in the
community, and that the sale would be all of the site, except the switch
station, the Nevada Power Company (NV Energy) Laughlin substation, and the
high-voltage transmission lines. No mention was made of setting aside 100 acres
for LA DWP. While the owners have not denied the 100 acres could possibly be
used for a future natural gas-fired generating station, at the LTAB meeting the
board was told that no type of a generating facility had been determined. A
natural gas pipeline ends at the 100 acres that sits next to the switchyard and
high-voltage transmission lines. Such a plant would irrepairably damage any
mixed-use, master-planned retirement community compatible to the existing neighboring
residential and commercial development in Upper Laughlin.
The 100-acre not-for-sale property also defies a fall 2015
town hall held by Dr. Joe Hardy, Laughlin’s state senator (District 12), in
which residents by margins of at least 7-1 voted to place gas generating power
stations on either side of the Needles Highway at Mile Post 4 on the Laughlin
Southland’s 9,000 acres that extend to the California border. That would put a
gas-fired plant about 7 road miles from the LA DWP proposed plant that also
would be about one-half mile west of Casino Drive.
Bob Stein of Edison’s government affairs office, Keith
Spencer of CBRE, and Cynthia Alejandre of Neveda Energy’s government affairs
office, said the sale announcement went to more than 750 potential buyers,
starting Oct. 11, 2016, and “the co-owners have not received any acceptable
offers”. While the owners did reject an offer for a 2,000-acre solar project,
saying they understood the community did not want a solar farm in the middle of
town, they neglected to mention that LA DWP has demanded the 100-acre site that
is too small for a commercial-style solar field.
They told the Laughlin audience the unidentified purchasing
prospects claimed the site is too big “for anticipated absorption”, has higher
construction costs compared “to nearby markets”, and there are other sites with
existing improvements still available.
Board Member Bruce Henry asked why an initial asking price
was not disclosed in October 2016 when the offering started but was only
released last week. He received “possibly” reasons and a statement that the $15
million is slightly less than the assessed value. The Clark County Assessor’s
Office lists the 2017-18 value as approximately $10 million.
The buyer must pay a non-refundable 10% cash deposit and the
plant owners would not give prospects a firm escrow closing date, in days,
months or even years.
It is well-known that the last 2 small parcels the owners
sold took 3 to 4 years to close escrow. Three different regulatory bodies also would
have had to give their approval to the sale of the 2,100 acres.
Continuing to recover their millions of dollars (which
should be concluded this year) of costs to demolish or “decommission” the site,
and potential flood problems for homebuilders also were cited.
Board Chair James “Jim” Maniaci said he testified in Las
Vegas on SB-347 as an economic development bill designed to integrate the
fallow lands and buildings in many Nevada communities.
By selling them to
private developers the lands, buildings, and lines would be put on the property
tax rolls, and removed from each utilities rate base from its rate-paying
customers. But nothing can be done until the utilities are forced to sell off
the surplus property. Until then, he said, the property will continue to be
included in the formula state utility commissions use to approve the rates
charged by the utilities to their customers, even though the surplus does not
contribute to generating or distributing power.
The plant opened in the early 1970s, producing 1,500
megawatts for customers in the LA, Phoenix, and southern Nevada areas, using
coal pumped some 275 miles from the Navajo and Hopi Indian Reservations in
northeastern Arizona. On Dec. 31, 2005, it ceased commercial power production
under a federal court order that had given the owners 6 years to install air
pollution control equipment.
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