Caesars to pay $44 million to leave Nevada Power
CARSON CITY — Caesars Entertainment Corp. has reached agreement to pay a $44 million “exit fee” to leave as a retail customer of Nevada Power and purchase its own power supplies on the wholesale market.
In a stipulation filed Thursday with the Public Utilities Commission, Caesars has also agreed to pay $3.5 million to Sierra Pacific, NV Energy’s Northern Nevada company, to exit as a retail customer.
The payment to NV Energy’s Southern Nevada company would be made in 72 equal payments over six years if the agreement is approved by the Public Utilities Commission.
Caesars would become the third large gaming company in the state to leave in recent months if the exit agreement is approved.
The company filed exit applications covering its Northern and Southern Nevada properties with the Nevada Public Utilities Commission in November. The company said it is prepared to leave NV Energy as soon as Sept. 1.
Exit fees are assessed by the PUC to allow for the departure. The fees are intended to protect remaining customers of the utility for energy investments made in part to ensure a reliable supply of power to the departing companies.
As part of the agreement, Caesars will pay a share of the cost of remediation and decommissioning the Reid Gardner coal fired plant at Moapa, set to shut down by next month, and for the Navajo Generating Station at Page, Arizona, where Nevada Power has an ownership interest.
Caesars operates numerous major hotel-casinos and related facilities in Southern Nevada: Bally’s Las Vegas, Caesars Palace, The Cromwell, Flamingo Las Vegas, Harrah’s Las Vegas, The Linq Hotel, Planet Hollywood, Paris Las Vegas, The Rio and Harrah’s Laughlin.
It operates three more in Northern Nevada: Harrah’s Reno, Harrah’s Lake Tahoe and Harveys Lake Tahoe.
If its exit is approved, Caesars would join Wynn Resorts Ltd. and MGM Resorts International in leaving as retail customers of the utility to seek cheaper electricity on the wholesale market. The two gaming companies left Oct. 1.
PUC staff determine what companies seeking to leave the utility have to pay to cover investments made in infrastructure to ensure a reliable supply of energy to its customer base.
The fees approved by the commission totaled $86.9 million for MGM and $15.7 million for Wynn.
Contact Sean Whaley at swhaley@reviewjournal.com or 775-461-3820. Follow @seanw801 on Twitter.