NV Energy’s request for its Southern Nevada customers to reimburse it for millions of dollars of expenses, including limousine transportation and alcoholic beverages, has experts calling it problematic.

After the state’s Bureau of Consumer Protection (BCP) and regulatory staff at the Public Utilities Commission of Nevada (PUCN) vetted reimbursement requests from the utility following its February filing, experts are recommending more than $16 million in expenses that it sought to charge to customers should be dismissed, on top of $3 million in expenses the utility has already withdrawn following questions about those charges.

This reimbursement issue is the latest in a series of findings involving public utilities asking customers to pay for questionable expenses. According to the watchdog Energy Policy Institute, these types of utility actions put the onus on consumer advocates and regulatory agency staff to catch what are referred to as “imprudent” requests, rather than having a system in place that prevents those types of requests from being made in the first place.

Nevada law requires that NV Energy file a general rate case at least once every 36 months. The process allows regulators to review the utility’s revenues and expenses as it seeks to change the rates charged to customers; in its most recent rate case, the utility is seeking to recover an additional $216 million in costs from ratepayers. 

In the original filing, roughly $20 million were cross charges — charges between NV Energy and its parent company, Berkshire Hathaway. NV Energy removed more than $3.1 million in those charges after initial questions were raised; now, after reviewing samples of expenses provided by the utility, the BCP is recommending regulators disallow the utility from recovering the remaining approximately $16 million it requested to charge ratepayers and instead cover the charges itself. 

While reviewing the utility's requests, staff at the state energy regulators’ office said they repeatedly noticed a lack of oversight by the utility when it comes to cross charges, as well as errors and a trend of rapidly increasing intercompany expenses, Flora Choi, a regulatory accountant for staff at the PUCN, said in testimony. Expenses cited as imprudent include limousine services and alcoholic beverage purchases. 

NV Energy staff acknowledged that some of the charges it asked customers to pay for were imprudent, but said it had removed those and other charges were still valid. 

“The company acknowledges that some inappropriate charges were included in its initial case, and that it must work to provide more financial oversight for these costs in future rate cases,” Mike Behrens, vice president and chief financial officer, said in testimony. “However, these issues do not mean that all … charges sought for recovery in this case are inappropriate or unsupported.”

NV Energy spokesperson Meghin Delaney added in an email that, “The company is committed to removing any charges that were incorrectly included in this case so that customers are not affected.”

Watchdogs say the requests by NV Energy point to a larger issue of utilities seeking compensation from ratepayers for charges that should be borne by the utilities — state energy regulators previously fined Southwest Gas for a similar situation, leading to litigation and ending with the state Supreme Court weighing in.

At least one proposal this past legislative session could have addressed the issue, but it died early in the session. The Nevada Conservation League floated a bill draft request that would have addressed the issue of ratepayer protections, but it never secured a sponsor. 

“This is just adding more evidence to the pile demonstrating why we need some reforms around how we regulate utilities in this country,” Stephanie Chase, research and communications manager at the watchdog Energy and Policy Institute, told The Nevada Independent. “We know utilities are doing things they aren’t supposed to be.

“Any one individual expense may not be a ton of money, but as you can see … they add up to a lot.”

Limo rides and luxury hotel rooms

When Berkshire Hathaway acquired NV Energy in 2013, they agreed with the BCP and state energy regulators to place a 10-year, $3.5 million annual cap (inflation adjusted) on how much in costs the parent company could pass down to Nevada ratepayers. That cap expired in 2023; recently, the company has seen a dramatic increase in cross charges, Choi said in testimony, pointing out that since 2020, there has been a 474 percent increase in cross charges (intercompany expenses) with no explanation from the utility.

It’s not usual for utilities to ask for recovery of what are known as “below-the-line” items, but in its current rate case, NV Energy is asking its customers to pay for portions of charges including hotel stays totaling thousands of dollars in Washington, D.C., and Phoenix, chauffeured limousine services, airfare to Europe and Asia and alcohol and meal charges.

BCP regulatory manager Nichole Loar cited some examples of the charges ratepayers are being asked to help cover, including: 

• More than $600 in hotel charges incurred by Berkshire Hathaway executives at hotels in Washington, D.C., and Phoenix; hotel charges that, in some cases, totaled more than $2,400 for a single night.
• More than $6,200 toward limousine services — several limousine invoices were submitted, some as high as $49,000.
• A portion of a nearly $1.29 million Berkshire Hathaway executive leadership conference in Las Vegas that included attendance by more than 60 NV Energy employees. Lodging was provided even for employees who live in Las Vegas.
• Roughly $50,000 toward a $450,000 Berkshire Hathaway professional development summit in Portland.
• Thousands of dollars in legal fees that the BCP said had an unclear benefit for Nevadans.
• Nearly $35,000 toward a Berkshire Hathaway investor conference in New York attended by executives including Behrens and former NV Energy CEO Doug Cannon. Expenses incurred on that trip included multiple alcohol charges.

BCP and PUCN staff point out in their testimony that the highlighted items are just a sampling of inappropriate costs sought by the utility, and that there could be more.

In her testimony, Loar said that if state energy regulators don’t believe all the charges should be disallowed, they should at least consider removing items she included in a line-by-line breakdown of requested costs.

Janet Wells, NV Energy’s vice president of regulatory, said in her testimony that she was “disheartened by the accusatory tone and proposals by some witnesses that ... simply seek punitive results.” 

Behrens suggested a compromise that would return to the cap limiting affiliate charges the company is allowed to recover from customers. 

“The company understands there have been challenges with the affiliate charges sought for recovery in this case, and a compromise, including an option on returning to the cap, represents a significant decrease from the request in the company’s direct case,” he said in testimony. “The company will then implement improvements before bringing its next rate case.”

Could legislation help? 

Nevada regulators have navigated these types of issues before.

In 2018, Southwest Gas sued the PUC after the agency did not allow it to recover certain costs from ratepayers. Regulatory staff determined the utility hadn’t properly justified recovery of expenses, which included charges for biweekly massages and a golf course membership. The utility agreed the costs were inappropriate and removed them; however, state energy regulators then excluded all costs requested by Southwest Gas because the utility had not fully justified them.

In 2019, state energy regulators assessed a $94,000 fine against Southwest Gas for its efforts to have ratepayers cover the cost of a backhoe destroyed in a 2016 gas leak and explosion. At the time, attorneys for the utility said the request for reimbursement for the backhoe was an “administrative error” that was caught before customers had to pay for it.

In 2022, the Nevada Supreme Court weighed in, ruling that the burden to prove costs are prudent falls to utilities. 

But Nevada lacks legislation prohibiting cost recovery of inappropriate expenses and implementing penalties for utilities that don’t comply. 

“There’s not a lot of incentive for utilities to not try to ask for forgiveness rather than permission,” Chase said. 

And, the current request by NV Energy for reimbursement for imprudent charges isn’t its first — during staff reviews of NV Energy’s two previous general rate cases, requested costs for reimbursement were discovered that should have been removed, Karen Olesky, a regulatory economist at the PUC, said in testimony. 

She questioned whether staffing issues at the utility were a possible reason for the below-the-line items being included in the general rate case. 

Regulatory staff pointed out that from 2021 to 2023, NV Energy’s vacancy rate for non-union employees increased from 7 percent to 9 percent, and between January 2019 and January 2025, NV Energy lost an average of three executives each year. Last month, Cannon abruptly left the company shortly after it was discovered the utility had overcharged tens of thousands of customers for more than two decades, with overcharges totaling more than $17 million.

Read more: NV Energy overcharged customers by millions over last two decades, state agency finds

The ongoing turnover, especially in leadership positions, results in a loss of institutional knowledge, Olesky said.

“While some of these incidents individually could be chalked up to an innocent mistake, the repeated history of similar mistakes shows that NV Energy’s policies and procedures for reviewing filings are not being enforced and followed,” she said in testimony. “Due to the high rates of turnover, the employees who were involved in pertinent past dockets and know how to properly handle these specific cost recovery issues are no longer with the Company.” 

Since 2023, a handful of states have enacted various ratepayer protection bills. A bill draft request focusing on prohibitions, transparency and enforcement that the Nevada Conservation League crafted prior to Nevada’s most recent legislative session mirrored what other states have implemented, said Deputy Director Christi Cabrera-Georgeson.  

The proposal would have made it easier for interveners such as the BCP “to look through what they [utilities] spent money on and make sure they aren’t breaking the law,” she said. “It’s black and white.” 

But the bill draft request was killed before the March 24 bill introduction deadline. 

“This was absolutely a missed opportunity this legislative session,” she said, declining to provide details on how the draft died other than that the utilities “did everything in their power to persuade legislators that this was not something we needed or that they should move forward with.”

“They should expect us to be back in the [2027] session with something similar,” she said.