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PSC STAFF SEEKS FORMAL REVIEW OF UTILITY EARNINGS

    LAS VEGAS, Aug. 13 /PRNewswire/ -- Nevada Power Co. (NYSE: NVP) rejects Public Service Commission of Nevada Staff claims of overearnings, announced Vice President, Finance and Chief Financial Officer Steven Rigazio.  The Staff announced yesterday that they intend to present "tentative findings" to the Commission that Nevada Power Co. is overearning by $11 million.  Staff says they will request that the Commission authorize them to proceed with a formal review of the company's financial records within the next two weeks.
    "We reject the Staff's findings," said Rigazio. "There's no question that Nevada Power's earnings have improved recently.  That doesn't mean we're overearning.  It means we're recovering from a three-year period of financial strain caused by rapid growth and regulatory lag."
    The Commission set Nevada Power Co.'s authorized rate of return at 12.5 percent in July of 1992.  Second quarter earnings for 1993, released Aug. 2, show the company earned a 10.5 percent return on equity, according to Rigazio.
    It is important to note that Staff functions separately and independently from the five Commissioners, he added.
    In a June '93 decision the Commissioners declined to proceed with an overearnings review of Sierra Pacific Power Co. requested by the Office of the Consumer Advocate, citing a lack of formal regulations for how such a review should be conducted.  The Commissioners instead ordered Staff to develop and recommend formal regulations for earnings reviews. The Commissioners could then apply the regulations to ensure that earnings reviews would be conducted in a thorough, consistent and equitable manner. To date, Staff has not proposed any regulations.
    -0-             08/13/93
    CONTACT:  Allison Newlon, 702-367-5678, or Robyn A. Warsinske, manager of Investor Relations, 702-367-5610, both of Nevada Power
    (NVP) CO:  NEVADA POWER CO. IN:  OIL ST:  NV


-- LA032 -- X687 08/13/93
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Publication:PR Newswire
Date:Aug 13, 1993
Words:297
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