Sierra Pacific Power Company
Contact: Faye Andersen
Phone: (775) 834-4822

For Immediate Release

Sierra Pacific Power Company filed today with the Public Utilities Commission of Nevada (PUCN) requesting an overall increase of 9.9 percent in electric rates to recover expenses for fuel and power purchased by the company last year, during a time of extremely volatile energy markets that saw unprecedented high prices.

The proposed increase for residential customers is 7.7 percent and would be reduced further, when combined with a 2.5 percent decrease in residential rates the company proposed in November 2001. For the average residential customer using 715 kilowatt hours of electricity per month the increase would be approximately $4.

In addition, Sierra Pacific filed an alternative proposal today with the (PUCN) which could significantly reduce the company's anticipated electric increase to customers by extending the recovery period beyond three years.

"We've been listening to our customers, civic leaders and policy-makers in Nevada and we understand what a hardship electric increases can be in today's economy,"said Sierra Pacific Power Co. President Jeff Ceccarelli."That's why we've worked diligently to come up with an alternative proposal that would lessen the burden on our customers, while still allowing the company to maintain its credit rating with investors."

"To pursue this alternative proposal we have to maintain the credit worthiness of the company to be able to provide a stable supply of energy for years to come,"Ceccarelli said."Our credit worthiness is directly tied to the full recovery of prudently incurred costs."

Today's filing by the company is the second required filing in a two-phase process, in response to Nevada legislation that calls for a thorough review of the utility's finances, expenditures, fuel and electric power purchases made on behalf of its customers. In what's called a Deferred Energy case, the company is seeking to recover its actual costs paid for wholesale power and fuel purchased on behalf of its customers during the height of last year's energy crisis. This is a dollar-for-dollar pass- through, with no mark up to customer.

In Phase One, Sierra Pacific filed a General Rate Case with the PUCN on November 30, 2001, requesting a $28 million increase, resulting in a proposed 4 percent overall increase for all types of customers. Residential customers could realize a 2.5 percent decrease from this filing.

Both cases will be heard concurrently by the PUCN. Formal hearings in the cases are expected to begin April 8, concluding with a decision by the PUCN on June 1. During hearings, the PUCN will closely examine not only Sierra Pacific's fuel and purchased power transactions, but also Sierra Pacific's operating and maintenance expenses, its finances and nearly $240 million in capital expenditures the company has made on new facilities to serve customers.

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