Northern Nevada, a relative bit player on the state’s modern-day energy stage until now, is poised to topple its southern counterpart from its leading role, according to NV Energy’s Integrated Resource Plan, which lays out the utility’s roadmap for the next three years and beyond.  

NV Energy intends to spend slightly more than $3 billion on capital projects in Northern Nevada in the next three years, according to its resource plan. The utility’s roadmap for the north dwarfs its plans for Southern Nevada, where the utility contemplates just $388 million in capital spending through 2029. 

The utility is projecting it needs 47% more electricity than it anticipated just two years ago in its last IRP, primarily to satisfy the needs of data centers in the north. That part of the state is “a sought-after location for data centers due to the expanse of developable land, a favorable climate for efficient cooling, and robust fiber connectivity,” according to its 41-volume plan filed in May with the Nevada Public Utilities Commission. 

By 2033, the utility projects electricity sales in the northern part of the state will eclipse sales in the south, where more than 70% of Nevadans live.  

NV Energy says it’s received “interest inquiries” from data centers seeking 22 gigawatts (GW) and has “executed approximately 6 GW of agreements to facilitate transmission, substation, and high voltage distribution infrastructure needed to interconnect these large loads.”  

Almost all of the signed agreements are with “large load customers in northern Nevada” and do not address generation and electric supply, the utility wrote, adding it projects kilowatt hour sales will double by 2029. 

Southern Nevada, however, will retain its dominance when it comes to peak demand, which is seasonal, unlike the 24-hour/seven day-a-week requirements of data centers. 

“The amount of money NV Energy intends to spend in the north is eye-opening,” observes David Chairez, who retired last year after more than two decades in utility regulation, first with the Public Utilities Commission and later as regulatory manager of the Nevada Bureau of Consumer Protection. 

While the utility doesn’t mark up the cost of power it purchases and sells to customers, it makes money from capital projects. 

At the end of 2025, according to the Federal Energy Regulatory Commission, NV Energy’s northern Nevada entity, Sierra Pacific Power Company, was carrying $2 billion on its books in construction work in progress, a cost that is passed on to customers when projects are completed.

In some cases, such as NV Energy’s massive $4.2 billion Greenlink transmission project, the PUC has allowed the utility to begin charging customers before construction is completed in order to avoid potential rate shock. 

If its latest resource plan is approved, Sierra Pacific customers will be on the hook for another $3 billion in capital projects in the next three years.

The question, Chairez says, is will the revenue paid to NV Energy by the data  centers offset the capital expenditures?

“There is a concern about affordability for Sierra customers,” he says. “The more plant they install to serve customers, the more money they make. Does that necessarily raise rates? It depends if you have growth to pay for that.”

Large loads have “amplified grid instability. If unmanaged, large load additions unquestionably present reliability risks,” NV Energy wrote in its IRP.  Last month, FERC issued an alert on the threat data centers pose to grid stability. 

In its IRP, NV Energy proposes formal agreements with large-load customers to protect residential and small business customers from the costs. Large customers would be required to pay for infrastructure and commit to long-term agreements.

“If a utility overbuilds generation, transmission, or distribution assets for large load customers who back out of contract, there is a danger that these stranded assets are not ‘used and useful’ in providing service to the utility’s customers,” says Chairez, adding that under the ‘used and useful doctrine’ regulators can disallow recovery of assets that don’t meet that threshold. 

Chairez cites NV Energy’s headquarters in Las Vegas as an example. 

“When it was originally built, the top floor was unoccupied,” Chairez says, adding that until it was recently occupied, “a disallowance adjustment was made to remove the cost of the top floor, or the portion that was unoccupied, because it was not used and useful.”

“How much of those agreements (with large load users) are made public and what’s in place to ensure that there is not cost-shifting to residents?” asks Julia Hubbard of Solar United Neighbors (SUN), who notes rules for applicants could be imposed by the PUC or state lawmakers. 

Fossil fuel comeback? 

NV Energy’s IRP proposes to add 4,370 megawatts (MW) of solar power; 5,405 MW of battery energy storage; 180 MW of geothermal energy; and 1,223 MW of natural gas peaking turbines.

The utility has sought for the last two decades to reduce its carbon footprint. 

In its 2021 Plan of Development, NV Energy stated that Greenlink “facilitates access to renewable energy zones and is necessary to accommodate decommissioning of conventional fossil fuel generation resources.”

But the deluge of data centers is fueling a nationwide natural gas renaissance, a phenomenon that could put a crimp in Nevada’s statutory mandate to utilities to provide half of their energy from renewable sources by 2030. 

NV Energy’s plan is too reliant on natural gas, says Brian Turner of Advanced Energy United, a trade organization for renewable energy interests. He notes that compliance with the state’s renewable standard “will be challenging for several years due to load growth and policy considerations impacting resource development.” 

Betting on the ‘if-come’

Data centers are known for flooding multiple markets with applications, then choosing the most advantageous arrangement.

“A lot of those historically have just fallen through,” says Hubbard of SUN. “People make inquiries and then move on to other locations.”

The demand for energy created by the proliferation of data centers could, under the right circumstances, be a boon to Nevada ratepayers, especially those with the capacity to return power to the grid, experts say. 

Renewable experts contend NV Energy’s resource plan falls short of improving ratepayer opportunities to reduce energy consumption, contribute to the grid via customer-owned resources, such as EV chargers, smart thermostats, rooftop solar, and battery storage, and establish an income stream in the process. 

Instead of “defaulting to building expensive new infrastructure” the utility should make greater use of those resources, says Turner. 

NV Energy’s IRP anticipates about 2,200 kilowatts of savings in 2027 from customer-owned resources, says Hubbard. “Right now we have 19 megawatts of home battery energy” that is not being put to use.  

Turner blames what he calls NV Energy’s opaque, closed-door procurement practices, which he says raise doubts about whether customers are getting the best deal. 

“Nevada has abundant, clean and cost-effective energy resources and developers and customers deserve transparent, competitive processes that guarantee the lowest cost reliable supply,” he says, adding the industry is negotiating with NV Energy to establish a grid service tariff. 

“If you’ve got a battery in your garage, an electric vehicle in the driveway, a smart thermostat, hot water heater, you sign up for this tariff and NV Energy tells you ‘we need that power,’” he says. “Thousands of homes automatically reduce their power just a little bit, but it adds up to tens or hundreds of megawatts.”

The practice, he says, sweetens the potential for not only saving, but profiting, from renewables.

NV Energy did not immediately say why it chose not to harness customers’ distributed energy to a greater capacity. 

The PUC will likely hold hearings on NV Energy’s IRP in late autumn.