Opinion ID: 2631746
Heading Depth: 1
Heading Rank: 4

Heading: The global settlement

Text: Nevada Power initiated several lawsuits challenging the lawfulness of S.B. 438 and previous deferred energy application rulings. In July 2000, these lawsuits were resolved when Nevada Power entered into a global settlement to, in part, prevent insolvency in light of the volatile market conditions and Nevada's regulated market structure. In addition to settling the lawsuits, the global settlement contained four provisions concerning the deregulation process. First, the settlement specified a restructuring schedule whereby the retail electricity market would open to Nevada Power's largest customers on November 1, 2000, and to all other customers on December 31, 2001. Second, Nevada Power would form a stand-alone affiliate by July 1, 2001, which would provide energy to Nevada Power's remaining customers until the retail market opened to them on December 31, 2001. Third, the settlement established a base electricity rate with the possibility of monthly energy adjustment riders if the base rate was inadequate to cover Nevada Power's costs. [9] Fourth, the settlement required an independent audit of Nevada Power's financial condition and its power procurement practices.