Three casino companies famous on a global scale – Las Vegas Sands, Wynn Resorts and MGM Resorts International, announced that they are attempting to terminate their contracts with NV Energy – the company that is currently providing them with electricity. According to representatives of the three companies, they can cut down on their electricity bills if the power for their properties is provided by solar farms or another electrical company.
However, NV Energy is urging the state regulators to take the necessary precautions to deter the three casinos from choosing another electricity supplier by imposing heavy fees. Yet, the NV Energy representatives remained tight-lipped as to what their next move is going to be. Although the electricity issue has already affected the entire state, the problem is particularly serious on the Strip.
According to the estimates, if the three resorts win the battle and successfully terminate their contracts, NV Energy is to lose up to 5% of its sales. MGM, Wynn and Las Vegas Sands announced that they are committed to keep the promises they made to shareholders and customers and use renewable energy.
The demands of the three casinos are just a part of the turn of events in Nevada where the price for a kilowatt-hour is higher than in some of the most popular tourist destinations in the USA. For the time being, NV Energy charges the three casino resorts 9-10 cents per kilowatt-hour for renewable and conventional power. According to the president of Wynn Resorts, Matt Maddox, the gradual increase that has been noticed over the last couple of years, is unacceptable and Wynn Resorts would not put up with the excessive price of the electricity.
Mr. Maddox added that there is no reason for Wynn Resorts to use NV Energy services when buying electricity from another supplier would result in a considerable cut in power costs. According to the estimates, Wynn Resort can save up to $7 million on an annual basis.
Rob Goldstein, the president of Las Vegas Sands, also commented on the matter and said that the company is willing to take the necessary actions towards being an environmental-friendly one. However, that would not be possible if NV Energy is the monopolist on the market.
The spokesperson of MGM was not reached for a comment.
Nevada officials are reluctant to take a stance on the matter and no customer has been allowed to terminate a contract with NV Energy despite being legally permitted to do so.
According to the Public Utilities Commission of Nevada, if big customers as the three resorts stop using the NV Energy services, the other customers’ bills would be affected in a negative manner so the company can be compensated for the losses.
If the final decision of the three resorts is to break their contracts with NV Energy, they will be required to pay one-time fees intended to make up for the losses of the electrical company.
MGM, Las Vegas Sands and Wynn will owe fees amounting to $90 million, $24 million and $17 million, respectively. They are most probably going to ask for the fees to be renegotiated, but the Commission is expected to announce its final decision on the matter by the end of the year.
