Sierra Pacific Power Company
Contact: Faye I. Andersen
Phone: 775-834-4822

For Immediate Release

Sierra Pacific Power Company announced today that it would be lowering customers'natural gas prices by three percent, resulting in a $1.89 decrease in the average residential customer's monthly bill. The decrease is effective Jan. 1, 2003.

According to the company, the change reflects a stabilizing of customer rates from the unprecedented energy prices in 2000 and 2001.

The decrease is a result of the company's annual mandatory Purchased Gas Adjustment filing made last July with the Public Utilities Commission of Nevada (PUCN) and includes costs the company paid suppliers for natural gas. The company's filing requested no net change for the total price customers paid. However, the PUCN adjusted the company's rates by $4 million, resulting in the decrease to customers.

Nevada regulations require utilities to purchase gas on behalf of their customers, keep track of the expenses and then seek reimbursement over a 12-month period based on actual costs. The decrease covers the cost of natural gas from May 2001 to April 2002. The decrease also reflects an adjustment of the price of natural gas going forward, based on the anticipated future wholesale prices.

With this decrease, the company said its natural gas prices continue to be the lowest in northern Nevada. Based on a usage of 60 therms of natural gas per month, the average residential customer's bill decreases from $63.59 to $61.70

Purchased Gas Adjustment filings do not include any profit or operating costs for the company, but only reflects commodity prices. Sierra Pacific serves approximately 120,000 natural gas customers in the Reno-Sparks metropolitan area.

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