Las Vegas-based utility proposes prepaid power cards program

The Public Utilities Commission is prepared to vote on a proposal to let the utility test the idea where participating residential customers would pay for power in advance.

A customer's payment would be recorded on cards that they then would swipe through a display unit that records how much power was purchased. The display unit would be plugged into an electrical outlet in the customer's home and would continuously show how much electricity the customer has used and how much prepurchased power the customer has left.

About 20 utilities in the nation, including the municipal utility serving the Phoenix area, have prepayment systems, Platt Research & Consulting reports.

When the customer has used most of the electricity for which he has paid, he could get the card recharged by making another advanced payment for electricity at Nevada Power's headquarters at 6226 W. Sahara Ave. or the North Las Vegas Customer Office at 2225 Civic Center Drive. The customer then would swipe the recharged card through the home display unit.

Once the customer consumes all of the prepaid electricity, his power would automatically go off. However, in an emergency the program would allow customers to get two days of power by phoning Nevada Power, prior to paying a new advance.

But the proposal has opposition.

"Why would anybody want this kind of thing unless you don't have an option?" asked Ernie Nielsen of the Washoe County Senior Law Project.

He is concerned about the program, in part because Sierra Pacific Resources, the parent company, may later expand the program to Sierra Pacific Power Co., which serves Northern Nevada.

Nevada Power mentioned several reasons consumers might like the program.

"A big part of the program is all about helping customers manage their usage," said Carol Marin, utility vice president of customer care. "This would allow the customer more control over what they pay for electricity."

Nielsen countered that Nevada Power could encourage conservation without requiring prepayment.

He and Larry Spitler, associate state director of AARP, expressed concern that the program could become mandatory for low-income customers in the future.

Spitler said AARP does not oppose letting Nevada Power try a pilot program. Yet, in written comments, Spitler complained that Nevada Power might later "seek installation of a prepayment meter as a credit and collection device."

Nevada Power is suggesting a pilot program that would be limited to 50 Nevada Power workers and 50 volunteers.

"We're keeping the number really small, because there is a huge change in the way we do business," Marin said.

Customers will pay $50 upfront, including a $30 deposit for the equipment, if the PUC approves the draft order as written by Chairman Don Soderberg. The customer would be charged $147 for losing or damaging the electric power display unit.

Nevada Power and the PUC staff suggested that the program might reduce late charges for customers and reduce power disconnections due to nonpayment. Nevada Power disconnects about 60,000 customers yearly for nonpayment.

John Howat, analyst retained by consumer advocate Tim Hay, disagreed. He contended the program would increase terminations, possibly causing health and safety problems for residents.

Howat recommended that the program be limited to those with household incomes greater than 150 percent of the federal poverty guidelines.

Spitler said he worried that senior citizens might turn off air conditioning and become overheated as they see power consumption costs rise. Also, a customer's pet or fish might die while the customer was out of town if the prepayments run out, he said.

People with health problems, who are entitled to delays in power disconnections for nonpayment, would not be allowed to participate in the prepayment program.