News Releases

C O R R E C T I O N -- Sierra Pacific Power Company

Oct 27, 2005

In the news release, PUCN Approves Electric and Natural Gas Rate Increases for Sierra Pacific, issued yesterday, Oct. 27, by Sierra Pacific Power Company over PR Newswire, we are advised by the company that the third paragraph, first sentence, should read"or a rise of approximately $5.66 per month, from $88.16 to $93.82"rather than"approximately $5.55 per month, from $86.44 to $91.99"as originally issued inadvertently.

Complete, corrected release follows:

PUCN Approves Electric and Natural Gas Rate Increases for Sierra Pacific Escalating Energy Prices Cited as Main Driver of Increases RENO, Nev., Oct. 27 -- The Public Utilities Commission of Nevada (PUCN) today approved increases in electric and natural gas rates in northern Nevada for Sierra Pacific Power Company, a wholly-owned subsidiary of Sierra Pacific Resources (NYSE:SRP-News).

The rate changes are a result of filings the company made this spring and summer to increase its rates due to the escalating and unprecedented high prices for natural gas being experienced across the nation, that is used in both producing electricity as well as supplying natural gas customers in the Reno-Sparks area. The new rates become effective November 1.

The PUCN approved a $64 million increase in electric rates, which for the typical residential customer using 715 kilowatt hours of electricity means a 6.5 percent increase, or a rise of approximately $5.66 per month, from $88.16 to $93.82. For natural gas customers in the Reno-Sparks metropolitan area, a $34 million increase means the typical natural gas customer using 59 therms of natural gas would see a 24.4 percent increase, or $15.56 per month, from $63.79 to $79.35.

"In the past few months, natural gas prices throughout the United States have reached their highest levels in history, double of what was predicted just one year ago,"said Mary Simmons, vice president of external affairs for Sierra Pacific. The Energy Information Administration, a division of the U.S. Department of Energy, predicts that regional prices for natural gas this winter will range from 30 to 60 percent higher than last year."Our company's increases for this coming winter are considerably less than the expected national averages because we contracted for our winter gas supplies before the recent, significant run-up in prices,"Simmons added.

She emphasized that the increases announced today do not include any profit for the company."These increases reflect prices we have already paid for natural gas to serve our customers, as well as the forecasted price the company expects to pay for fuel and power to supply customers this winter,"she said.

Noting the increases granted today by the PUCN were higher than the company originally requested, Simmons added,"The PUCN and their staff recognize the sharp increases in prices that have occurred throughout the summer months and the anticipation that they will continue to remain high throughout this winter. By matching the prices we charge closer to the actual cost of energy, we avoid building a big deficit that we will have to recover from customers later."

On July 1, the company also requested to update its electric rates for northern Nevada customers in the face of escalating energy prices for fuel it uses to generate electricity and power that it purchases to serve customers. Sierra Pacific is required by the PUCN to update its energy rates annually, but may file mid-year if prices fluctuate significantly. The purpose of the company's July filing was an attempt to prevent or reduce the build-up of a large under collection that customers would be asked to pay at a later time.

Simmons encouraged customers to take steps to winterize their homes before the winter heating season arrives."There are many things each of us can do that are no or low-cost measures to conserve energy and reduce monthly bills, like setting thermostats no higher than 68-degrees. Each degree of temperature means a three percent impact on bills."

Many no cost, low cost and added cost conservation tips and ideas can be found on the company's website at

Sierra Pacific Power Company serves approximately 300,000 electric customers in northern Nevada and 135,000 natural gas customers in the Reno-Sparks metropolitan area. Sierra Pacific Power Company is a wholly-owned subsidiary of Sierra Pacific Resources (NYSE:SRP-News).

Forward-Looking Statements: This press release contains forward-looking statements regarding the future performance of Sierra Pacific Power Company, within the meaning of the Private Securities Litigation Reform Act of 1995. These statements are subject to a variety of risks and uncertainties that could cause actual results to differ materially from current expectations. These risks and uncertainties include, but are not limited to, increased prices and limited availability of fuel, purchased power and natural gas, unfavorable rulings in Sierra Pacific Power's future deferred energy and general rate cases and Sierra Pacific Power's ability to maintain access to the capital markets to support its working capital and liquidity needs. Additional cautionary statements regarding other risk factors that could have an effect on the future performance of Sierra Pacific Power Company are contained in its Quarterly Reports on Form 10-Q for the quarter ended June 30, 2005 and its Annual Report on Form 10-K for the year ended December 31, 2004, filed with the SEC. Sierra Pacific Power Company undertakes no obligation to release publicly the result of any revisions to these forward-looking statements that may be made to reflect events or circumstances after the date hereof or to reflect the occurrence of unanticipated events.