Las Vegas NowNV Energy Execs Make Millions, Ask for Rate Increase

NV Energy Execs Make Millions, Ask for Rate Increase

You may have felt outrage when you learned that NV Energy wants to raise power rates by 17.5-percent. That's exactly how the Nevada Attorney General's Office reacted, too. The AG's office will represent you at the rate hike hearing.

The moment you turn on anything that uses electricity, the meter on the side of your house starts turning. This is how NV Energy tracks how much to charge you each month. The company wants you to pay more as this turns.

Since 2003, NV Energy has asked for a general power rate hike three times. The power company says investments in building power plants in Nevada made the increase necessary.

Who is Responsible?

The AG's consumer advocate knew there would be an increase, but was surprised by the size.

"We are really disappointed that it's so much. Hopefully we can make a difference in what we can find in the rate case and reduce it," said NV Chief Deputy Attorney General Consumer Advocate Eric Witkoski.

Witkoski represents all the consumers in the state during the rate hike hearings that will take place this spring.

In an interview when the increase was announced, NV Energy President and CEO Michael Yackira says he asked to implement the increase in September so customers will keep the old rate over the summer, "We would have a bigger rate increase if it was not for the fact that we have been investing in power plants in Nevada for the benefit of Nevadans."

Witkoski understands, but points to waste in the company as a reason to lower the rate. He plans to highlight upper management compensation in this recession, "It does cause problems, especially when people are struggling to see these kinds of compensation. It's probably infuriating to some people."

According to NV Energy's government filings, in 2006 the Chairman, President and CEO Walter Higgins made about $5.6 million. The same year Yackira made more than $1.4 million as Executive Vice President and CFO.

In 2007, Higgins got a 49-percent raise to about $8.3 million and Yackira, who was promoted to President and CEO, made 141-percent more. His new total compensation was about $3.5 million.

In a statement, NV Energy says, "NV Energy's salary and compensation decisions are based on comprehensive analyses preformed by Towers-Perrin, a nationally-recognized consulting firm which conducts comparison surveys of other companies. Salaries of our company's leadership are well within the industry average for comparably sized businesses and within 5-percent of mid-range in the energy services industry.

"It also is important to note that most compensation for our senior officers is performance based and tied to key milestones for our company, such as operating and financial performance, including total shareholder return."

All employee pay makes up about 1-percent of the cost of the rate hike.

The majority of the compensation for Higgins and Yackira is in stock awards. If they held on to the stock instead of cashing out, they may not have made as much as the annual filing reflects.