In a battle of billionaires, Sheldon Adelson and Warren Buffett are squaring off over who controls the power that keeps the bright lights blazing in Las Vegas and across Nevada.
Adelson, the Republican mega-donor and founder of the Las Vegas Sands Corp., is backing an initiative on the Nov. 6 ballot that lets customers choose their own power provider by 2023. At risk is NV Energy Inc., a utility owned by Buffett’s Berkshire Hathaway Inc. that now holds a virtual monopoly in the state. The total cost of the fight so far: Almost $100 million.
The initiative gained 72 percent of the vote in 2016, but needs to win a second consecutive ballot to become law. A September poll showed the initiative trailing by 19 percentage points, but with 16.4 percent of residents undecided. At the same time, the renewables industry has been largely uncommitted, citing a lack of detail on how it may play out.
“At the highest level, you have a couple billionaires slugging it out,” said David Damore, a professor of political science at the University of Nevada, Las Vegas. “It’s a very complicated issue, one that probably shouldn’t be handled at the ballot box, given how much uncertainty there is around it.”
The proposition, which seeks to amend wording in the state constitution, has prompted one of the most heavily financed political battles in the current U.S. election cycle. The amount raised for it exceeds the $91.6 million spent in the state’s high profile U.S. Senate race, and the $40 million battle over energy use in Arizona, Nevada’s southern neighbor.
Meanwhile, it’s not the only energy initiative being fought out in Nevada. Another billionaire, Tom Steyer, a Democratic mega-donor, is supporting a push to require half of the state’s electricity to come from renewables by 2030, mirroring his similar effort in Arizona. Steyer said in an interview he’s not involved in the energy choice initiative.
The battles in both states come as the U.S. power industry is grappling with a historic transformation. Cheap solar and wind power, along with better battery storage, are emboldening homeowners and businesses to go it alone, loosening the grip of utilities that once owned and distributed all of the electricity in their regions.
In California, cities and counties dissatisfied with utilities’ pace of adding clean power are creating their own power agencies. In parts of the Northwest, utilities -- including owned by Berkshire -- and renewables developers have been at loggerheads over a 40-year-old law that was partly intended to boost clean power.
An April report by state regulators found that NV Energy would likely be forced to sell its power plants and assign its power-purchase contracts to new owners if the energy choice measure is adopted. That could saddle Nevada ratepayers with potentially several billion dollars in costs to pay for the so-called "stranded assets," but those expenses would diminish over time, the report said.
The Coalition to Defeat Question 3, backed by NV Energy, is labeling the initiative in media ads as "risky" and "expensive," and says it will disrupt progress toward getting more renewable energy. State filings show the coalition has raised $62.3 million in cash to pursue its fight, with all but $12,000 of it coming from the utility.