Monthly Archives: May 2016

Card security revolution stalls

More than seven months after the mandated deadline for conversion, most businesses throughout the Las Vegas Valley, and around the country, have not upgraded their point-of-sale credit card readers to process the EMV embedded credit card chip.

Equally slow have been the banks and credit card companies in the issuance of the new EMV embedded credit and debit cards. As of this week, an informal poll has indicated that while most major banks have issued EMV compliant credit cards, the chip-enabled debit cards have been slow to hit the consumer wallets.

A spokesperson for Nevada State Bank said: “Credit cards with chips have all been sent to customers. Debit cards have been sent in waves, as it takes months to process all the accounts and all the cards. All active users should have them by end of year, and non-active users will continue to be issued—expected complete in Q1 2017.”

The “Liability Shift” was to take place on Oct. 1, 2015. After that date, all businesses using the EMV embedded credit and debit cards would not be responsible for the effects of any identity or credit card theft. However, those businesses still using the magnetic strip on the back of the credit or debit cards to complete a transaction would be solely liable for the impact of any account hacking.

Linda Ray, who along with her husband Sherman, own Avery’s Coffee on West Sahara, has been struggling to be in compliance with the liability shift regulations. “I have bought the card reader, and it is installed, but I cannot use it because the EMV software is not compatible,” Ray explained. “However, I have been assured by my processing company that they will take full responsibility if we are hacked and our client’s credit card information is stolen.”

Avery’s, like many other small businesses around Las Vegas, uses a point-of-sale (POS), processing software that is provided by Shopkeep. “Our hardware is ready to take EMV; we are just waiting on our gateway to be able to accept it,” said a customer service representative at ShopKeep. A statement from the Shopkeep website reads “As long as you have ordered an EMV-capable credit card reader from ShopKeep (iCMP or iPP320), we will offer you liability coverage.”

ShopKeep is ranked among the Top 10 POS systems available for small- to medium-sized businesses. A website review of the other leading POS technology companies can lead business owners through a technology maze of companies that interact with each other, some on a proprietary basis and others as a general platform. The combination of POS software system, credit card processing company, and the hardware equipment that is used will determine how and if the EMV transaction can be processed. About half of the POS companies are not able to process EMV transactions at this time while the other half use a combination of proprietary and secondary links to complete the transaction.

In the meantime, while the banks and POS software providers are struggling to get on top of the issues, the National Retail Federation remains opposed to the liability shift ultimatum.

In testimony before Congress last November, the National Retail Federation said: “Don’t blame us for the slow uptake. New point-of-sale terminals for accepting chip cards cost up to $2,000 each, and that’s a bitter pill for small businesses to swallow.”

That’s just one of the concerns.

“The new EMV equipment does not stop breaches,” said David French, NRF senior vice president for government relations. “Indeed, in many cases, it provides no significant benefits either to the business or to the business’ regular customers. It is merely an additional expense small businesses are being told to bear.”

French’s comment is based on the fact that when the U.S. instituted the EMV change, it only adopted half of the technology that makes the transaction safe. In Europe, the EMV chip is used in conjunction with a personal identification number like debit card transactions already require. However, in the U.S., EMV credit card purchases simply require a signature to complete the transaction. Anyone who has signed on an electronic pad knows that nearly any scribble is accepted as a signature.

“While the chips make the cards more difficult to counterfeit, they do nothing to protect lost or stolen cards, while a PIN alone could prevent both types of fraud,” French said.

Earlier this month, Wal-Mart Stores Inc. sued VISA Inc.’s U.S. unit, claiming the card company wants the retailer to continue to offer the less-secure signature method for verifying debit cards in order to route transactions through VISA’s own networks to boost internal profits. VISA reportedly charges Wal-Mart five cents more for signature authentication than PIN transactions.

Wal-Mart stated in its complaint that the chip-and-pin payment protocol at the checkout counter is more secure than the signature authorization. Seventy percent of Wal-Mart’s customers use their debit card to pay for their purchases, and approximately 10 percent of those customers choose to authenticate using the signature method, most likely because it’s easier than remembering and entering a PIN. Wal-Mart wants to eliminate the signature option, but VISA wants to keep that option available.

In addition to the security issues and upgrade costs, business owners are also concerned about the amount of time that it takes to complete a transaction. However, according to processing companies, the actual transaction time is a perception problem.

While the EMV transaction may take an additional two to three seconds than the traditional card swipe transaction, it seems much longer because the card is left in the reader for the entire transaction time. When a card is swiped using the magnetic strip, the customer uses the processing time to put the card back into their wallet and then place the wallet back into their pocket or purse. By the time these actions are completed, so too is the transaction and the signature is requested.

The good news is that a new technology — called Quick Chip for EMV — is about to streamline the transaction process by enabling the customer to insert and remove their EMV chip card from the terminal, typically in two seconds or less, without waiting for the transaction to be finalized. The consumer and the issuer don’t need to do anything because this technology is just an upgrade in the software of EMV-enabled terminals. This upgrade can be done by the merchants and is free.

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City tries new weapon to fight urban blight

 

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Robert Klein, founder of SecureView, watches a demonstration of the product at an abandoned home near Charleston and Pecos May 5. Photo by Craig A. Ruark, special to the Las Vegas Business Press

 

Urban blight can spread throughout a neighborhood and then down the street to the next. While economics may be the chief cause of urban blight, the visual effects such as boarded up windows, weeds, and overgrown foliage, only serve to exacerbate the problem.

Now the city of Las Vegas is experimenting with a way to keep vacant buildings secure without the stigma of boarded-up windows.

Communities spend a lot of time and money trying to curb urban blight. Code enforcement officers watch for buildings that have fallen into disrepair or abandoned. In most cases, the owners of the properties are sent letters and asked to correct code violations. In some cases, the city has no other choice but to board up the building to prevent squatters from moving in or illegal activity from happening behind the walls. However, it is the boarded up building that signifies that the neighborhood is suffering.

To help diminish the visual effects of urban blight, the City of Las Vegas is experimenting SecureView.

During a May 5 demonstration at an abandoned home near Charleston and Pecos, a team from SecureView replaced the unsightly plywood that the city had used to keep out vagrants, with a quarter-inch-thick piece of recycled polycarbonate that is nearly as clear as glass and 200 times stronger.

The idea behind the SecureView product came from Robert Klein, founder, and chairman of the company. Klein, a real estate investor, was a partner in a downtown Chicago property that was all boarded up to prevent further damage to the building before it could be sold. However, despite marketing efforts, the building was too unsightly to sell.

“One of my partners is an engineer and suggested that we replaced the boards with a clear polycarbonate that looked like windows, and the building sold,” said Klein.

The key to the product’s success is making a house, apartment, or commercial storefront look like the other buildings in the neighborhood, yet secure from squatters and vandals. Without the stigma of boarded up buildings, neighborhood property values don’t decline as much. And, by using a clear product, neighbors, security patrols, and first responders can see inside the building to make sure it remains vacant. Besides being clear, the polycarbonate is 200 times stronger than glass, so rocks and tools cannot be used to penetrate the surface.

To prove the strength of the polycarbonate, volunteers were invited to try to break through the SecureView-covered opening using a sledgehammer. John Egan, a tall, muscular code enforcement officer with the City of Las Vegas, gave several mighty blows to the polycarbonate material. While the sound from each blow echoed louder than a gunshot and brought neighbors out of their homes, Egan only managed to make a few dents in the material.

“We are looking at SecureView as an alternative to plywood to manage the abandon buildings within the city,” said Tom Perrigo, planning director and chief sustainability officer for the City of Las Vegas. “The initial cost is more expensive, but it will save money in the long run by not having to send someone out to replace the plywood two or three times.”

The clear polycarbonate sheets are cut using a diamond-edge circular saw blade and fit into the existing window frame. A metal backing arm is secured to the inside of the building and bolts are used to secure the polycarbonate material to the backing arms, creating a compression fit that cannot be penetrated.

The SecureView product is sold in eight-foot lengths and widths of four-feet for $115, a five-foot width for $169, or a six-foot width for $199. Those costs also include the metal backing arms.

For window openings that are larger than eight- by six-foot opening, such as a storefront window, SecureView can, for an additional charge, heat the edges of two panels to over 500 degrees and melt them together to form a single larger panel.

If an abandoned building is demolished or refurbished, the SecureView system can be removed and reused many times over at other properties, saving even more money for the city of Las Vegas.

Information on the SecureView product can be found at http://www.secureviewusa.com/


Cyberattack can’t spoil Kangamoo’s debut

 

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The Wachters–Shawn, Mimi, and daughter MaiLee –and mascot Kangamoo all got through a tough opening day at their playland marred by a cyber attack. Photo by Craig A. Ruark/Special to the Las Vegas Business Press

 

With apologies to Dickens, this is a tale of two Las Vegas couples, starting their own separate small businesses, and of childhood innocence combined with cybertheft.

Entrepreneurs Shawn and Mimi Wachter recently opened Kangamoo, a 10,000-square-foot indoor playground that has become an instant success. But this is not just an ordinary children’s playground; it is also a place where parents can relax and play and, since this is the information age, do business using Kangamoo’s free WiFi.

For the Wachter’s, Kangamoo is the result of part inspiration, part aspiration, and much perspiration. But, as it turns out, it is partly the result of luck as well.

The opening day of Kangamoo, while filled with excitement, could have been their closing day if the Wachter’s daughter had not gone to the same daycare as Troy and Shannon Wilkinson’s daughter.

The Wilkinson’s had just opened Axiom Cyber Solutions, and the Wachters had contracted with Axiom to guard Kangamoo’s computer system against hackers.

The Wilkinson’s, seeing a great place for their daughter to play, had signed up as members of Kangamoo, filling out a form that gave their names, address, daughter’s birthday and other information such as credit card account, to be stored in the Kangamoo computer system.

Come opening day, while children were frolicking at Kangamoo, hackers were busy trying to gain access to the Kangamoo computer system. However, the Axiom-installed fire wall held and all of the information remained safe and secure.

“We’re a small, independent indoor playground—we didn’t expect to face an attempted data breach ever, let alone just hours after opening our doors to the public,” said Mimi Wachter. “You hear about this kind of thing happening to large corporations with millions of customers; it was really off our radar that a tiny, new business like ours would be targeted.”

A series of coincidences are responsible for this tale of fortunate events. Both the Wachter’s and the Wilkinson’s met through their work, both couples married in 2010, had daughters that attended the same daycare, joined the Las Vegas Metro Chamber of Commerce around the same time, and both couples were opening new businesses in Las Vegas.

The story of Axiom can be found in the Jan. 18 edition of the Las Vegas Business Press (http://businesspress.vegas/technology/local-firm-takes-online-demons).

The Wachter’s met while working in Los Angeles for Gensler Architecture, one of the world’s largest architecture firms. Shawn, a designer, and Mimi, a project manager, were both on the ladder to success when in 2007, at age 33, Shawn was hit with cancer. In 2008, the economy crashed and with Shawn on leave for chemotherapy treatments, Mimi was struggling to stay employed.

In 2010, the pair married and decided to move to Las Vegas where they could find more affordable housing. And in June of 2011, their daughter MaiLee was born.

Like all good parents, the Wachter’s took MaiLee to the zoo to see the animals, and it was an early visit that became the inspiration for their future endeavor. While at the zoo, MaiLee fell in love with what she called a “Kangamoo.” The Wachter’s were so inspired by MaiLee’s fascination and mispronunciation of this adorable animal that they filed for a trademark on the name.

Having survived cancer and the recession, the Wachters aspired to work for themselves and spend more time with their growing daughter. The idea for an indoor playground came out of necessity. Las Vegas is too hot in the summer, often very windy, and the winters are cold, at least compared to Southern California). The answer was a climate controlled year round facility, and Kangamoo Indoor Playground was born.

Although the Wachters were familiar with the process of designing and renovating commercial businesses, they were taken by surprise by the amount of work that it would take to design, permit, and build their own business. The planning took six months and for the next six months, the couple practically lived in the warehouse facility, electing to do all of the renovation work themselves.

Shawn’s 20-year background in retail allowed him to create a polished franchise brand look to the business.

Incorporated into their concept is an adult area with a bank of massage chairs, Wi-Fi, laptop and phone charging stations, a jogging track, do-it-yourself beauty stations, and work space that is free for the parents, who must remain in the building with their children.

Due to Clark County Health Department regulations, no outside food can be brought into the facility by parents or children. However, there is a health food bar stocked with water, juice drinks and healthy snacks such as fruit, yogurts, and vegetables.

Enabling the parents to relax is a staff of eight employees who monitor the playground to make sure each child is safe and having fun. After only a week of operation, the Wachters decided to hire an additional eight employees. Each employee undergoes a thorough background check, and there are instructions given for basic first aid.

The playground consists of a giant treehouse type maze of tunnels, rope crossings, ladders, and a giant slide. There is also a corner which is Mimi’s pride and joy, where children are given the opportunity to draw and color using old fashion Crayons or play with building blocks.

When the six-foot Kangamoo character walks into the play area, the children rush to its side and wrap their arms around the snuggly icon.

The playground is located at 1525 E. Sunset Road, Suite 7, with windows that overlook McCarran Airport so parents and children alike can watch the takeoff and landing of airplanes.

The facility is open to children ages 1-10 and the cost for three hours of play is $10. An annual membership for unlimited free play is $225. The facility is also available for private parties.


SBA names restaurateur state’s Small Business Person of Year

Even before Brad Burdsall graduated from the UNLV School of Hotel Administration in 1993, he knew that one day he would own a restaurant.

Fast forward 23 years and Burdsall owns not one restaurant, but a chain of six successful Egg Works and Egg &I Family Restaurants, a commercial kitchen and corporate headquarters. His company employs more than 300 employees.

“It was the perfect storm of a businessman with a passion for cooking,” Burdsall said of the success that this year earned him the federal Small Business Administration’s designation as Small Business Person of the Year in Nevada.

Not only did Burdsall pay attention in class, he kept learning and fine-tuning his business knowledge after receiving his college degree. While waiting tables at the Olive Garden and the Mirage coffee shop, Burdsall began developing his idea for the Egg Works brand. Later as a chef and manager at Macaroni Grill, he was working on a business plan for his own restaurant.

In 1998, with funds borrowed from his parents and uncle, Burdsall and his one-time partner purchased the Egg &I restaurant on West Sahara Avenue between Arville and Decatur.

By 2005, Burdsall was ready to expand. He took an SBA loan to purchase the land and build his third location on Rainbow and the 215 Beltway. “To me, from a business sense, using the real estate analogy, the SBA loan allowed me to move from being a renter to buying a home,” he said.

Burdsall said the key feature of an SBA loan is the borrower needing only a 10 percent down payment as opposed to a 30 percent with a conventional loan.

Ann Santiago of TMC Financing agrees. Santiago’s company is an SBA-certified development company that puts together SBA commercial real estate loans.

“If you have a $1 million loan and only need to put 10 percent down, then you can save $200,000 in cash for working capital that does not have to go into the ground,” Santiago said.

Burdsall feels most budding businesses go about small business loans the wrong way. Going to the bank before the SBA often ends in the loan being rejected, ending the process, he said. Burdsall suggests using TMC Financing or another SBA-certified company to become prequalified, then letting that company pitch the package to the banks.

Burdsall had been working with Eric Colvin at Meadows Bank for his business account, so it was only natural that Meadows also processed his SBA loan. “We are one of the few banks in Las Vegas that specializes in SBA financing,” Colvin said. “Because we are a community bank without a lot of branch locations, we don’t require that a business bank with us to process an SBA loan.”

Burdsall has four SBA loans that helped him expand his business to three restaurant locations and purchase a 20,000-square-foot building on the corner of Cameron and Hacienda, which serves as a warehouse, commercial kitchen and corporate headquarters.

On April 30, Burdsall joined winners from all 50 states and U.S. territories in Washington, D.C. for the announcement of SBA’s National Small Businessperson of the Year. The applicants are judged based on the history of the company, their business plans, analysis of growth, and how they have overcome adversity.

The Egg Works chain, known for its homemade banana nut muffins, produces 2,500 muffins a day at its commercial kitchen. Along with the enormous number of eggs they purchase and store in a 1,500-square-foot refrigerator, pallets full of bananas are also ripening to perfect sweetness. In addition, Egg Works makes bulk batches of chili, corned beef hash, and other products that are distributed to the individual restaurants. This mass production allows for a consistent taste as well as highly discounted purchasing power.

To make his restaurants stand out from the competition, Burdsall also has developed his own brand of hot sauce, called “Habla Diablo,” along with a Bloody Mary mix, Hollandaise sauce, and 17 different spice blends that fill the dry storage area with a strong aroma.

The beauty of the business is that the restaurants are open from 6 a.m. to 3 p.m. which “gives me time to spend with my family.” Burdsall has been married to wife Catherine for 17 years, and together they have a 15-year-old daughter, Olivia, who is active in theater as an actress and singer, and 12-year-old son, Tyler, who is a level eight gymnast.

In addition to cooking, Burdsall’s passion is the collection of pinball machines – he has more than 40 — and riding quad bikes in the mountains with his family.


SBA to recognize PrideStaff owner

Bob Daniel speaks casually and in a positive, upbeat fashion about what it takes to be successful. His rich baritone voice makes it clear he’s an authority.

As the owner and strategic partner of PrideStaff Las Vegas, Daniel shares his knowledge with every staffing applicant who walks through his door, mentoring them to make sure his clients receive quality, motivated, part- and full-time employees who will enhance their business.

It is this trademark of personalized quality and service that has earned Daniel the Small Business Administration’s award as Nevada Veteran-Owned Business of the Year.

He will be among more than a dozen to be honored Wednesday during an SBA luncheon at the Gold Coast.

Graduating high school during the Vietnam war era, Daniel realized that he didn’t have the grades or money for college, so he enlisted in the Air Force to learn a skill and perhaps take advantage of the GI Bill to continue his education. He parlayed skills he learned in a high school typing class to an assignment handling administrative duties. He was stationed in Texas, the Philippines, Vietnam, and then back to Texas during his four years of service.

Daniel spent the next 32 years in the private sector hiring, training and managing cross-functional teams. These teams consisted of sales, supply chain, marketing and Web development at IBM, Micron, and Fujifilm. He was a staff instructor at IBM’s Management Development Center.

In addition to working a full-time job, Daniel completed his education by first using the GI Bill to finance his associate’s degree in business management, and then continuing on his own to receive a bachelor’s degree in professional studies, and a master’s in business administration.

Despite all of the higher education studies, Daniel credits his time in the Air Force as his major learning experience and the foundation for his success in business. “It helped me and prepared me in a couple of ways. One is just being able to listen and communicate in terms of understanding the other person’s perspective without being judgmental. I also learned how to research and where to look to find the answers to questions.”

MOVING TO LAS VEGAS

In 2004, after years of success in the corporate world and as an empty nester living in New Jersey, Daniel and Mini, his wife of 47 years, decided to escape the cold winters and moved to Las Vegas.

“I liken Las Vegas to the new melting pot, a forward-thinking community with tremendous opportunities for individuals that are willing to work hard, play fair, but compete vigorously. There is also a Wild West kind of mentality where everything is fair game, and you just need to figure out how to get your share of it,” said Daniel.

Daniel purchased a PrideStaff franchise rather than reinvent the wheel, and in 2006, the couple opened the Las Vegas office.

He was nominated for ‘Nevada Veteran Owned Business of the Year’ award by Kenyatta Lewis, executive director of supplier diversity for MGM Resorts International.

Lewis complimented Daniel for his ethics and perseverance. “He patiently pursued a business relationship with us for five years before we worked together. The initial order was a small one — just a single limousine driver—but Bob treated that placement, and every one since, as his top priority.”

With a staff of just four full-time and two part-time administrative employees, PrideStaff Las Vegas has more than 100 employees working on assignment at client locations each week. The company provides both white- and blue-collar staff for hospitality, gaming, finance, manufacturing, distribution, construction, information technology, transportation utilities, architecture, government, and professional services.

However, Daniel said he is selective when it comes to the number and type of companies that he will take on as a client.

“I don’t want to be all things to all people. And I don’t want a large client count because it becomes unmanageable and I would end up alienating people. So I am very specific as to who we do business with, and I really want it to be a partnership,” said Daniel.

That fits with Lewis’ experience.

STRESSING THE VALUE OF HIS SERVICES

“Bob has never tried to ‘sell us staffing.’ He’s educated us about the strategic value of his services, developed innovative solutions to our business problems, and shown us how to use PrideStaff’s resources to thrive in any market conditions. PrideStaff is more than a vendor; they’re a partner in our success,” said Lewis.

As a minority- and veteran-owned business serving Las Vegas, North Las Vegas, and Henderson, PrideStaff is one of Clark County’s leading employment and staffing agencies. The firm provides a full complement of administrative and light industrial temporary, temp-to-hire and direct placement solutions to help employers overcome their biggest workforce challenges while helping area job seekers find meaningful employment.

In addition to running a business, Daniel still finds time to give back to the community. He is actively involved with the Las Vegas Metro Chamber of Commerce, 100 Black Men of Las Vegas, Las Vegas Minority Supplier Development Council as well as the Southern Nevada Human Resources Association.


Corporate philanthropy grows, targets education

“Nevada’s path of recovery in the past few years has been nothing short of remarkable,” says Jeremy Aguero, principal of Applied Analysis and co-author of a report on Corporate Philanthropy in Nevada 2015.

In short, Nevada’s corporate generosity of 0.21 percent of total revenue, or $100.9 million, exceeds the national average of 0.13 percent.

That equates to roughly $441 per employee per year for the average Nevada company compared to a national average of $88 per employee.

The report, released on April 5, contains an intense 15 pages of facts and figures about Nevada’s corporate giving and how the state compares to others in the U.S.

Many of the details and statistics contained in the report were released earlier this year and reported in the Feb. 15 issue of the Las Vegas Business Press. The survey found 100 percent of the companies cited education as a key priority for Nevada’s corporate philanthropy.

The chief reason is that better education brings more economic diversity, one of the state’s priority needs.

One of the companies highlighted in the report, City National Bank, said it believes education is the key to economic diversity and focused its philanthropic efforts on “providing the best possible return on investments.” Seeing Nevada’s youth as future leaders, City National created the “Reading is the way up” program to develop childhood literacy.

Through the program, the company invests in school libraries, teacher grants for K-12 schools and community partnerships to enhance literacy. Employees of City National also receive up to three hours of paid time off per month to read to students.

The program has been responsible for donating 115,000 books, over $500,000 in grants and reaching more than 100,000 children in the areas that the bank serves.

Overall giving to Nevada’s educational programs grew to a total of 44 percent of all spending, a notable increase from 12 percent last year and well above the 13 percent national average. Recent events in Nevada have called attention to the vast amount of land in Nevada that is under environmental protection.

Barrick Gold, a major employer and mining company that makes its living from Nevada’s natural resources, also recognizes how important it is to protect the environment.

The company has teamed up with the Nature Conservancy to implement a conservation plan on 582,000 acres of the unique sage-grouse habitat. The goal of the joint venture is to measurably improve the habitat population over the next three years.

In Nevada, giving to environmental preservation reached 7 percent of the total, which again tops the national average of 4 percent.

Volunteerism is a critical part of corporate philanthropy programs. More than 71 percent of the companies surveyed offered a volunteer program, with just over 445,000 volunteer hours reported by employees in the past year, an average of 2.8 hours per employee. The report highlighted several companies that value their employee participation.

The Caesars Foundation has for more than a decade supported the Meals on Wheels program which provides regular meals, friendly visits, safety checks and other services. Caesars “HERO” volunteers ensure that no senior citizen is hungry or alone.

NV Energy also concentrates its philanthropic efforts on the large senior citizen community through the Senior Energy Assistance Expo that helps to manage energy bills.

During the expo, 130 employee volunteers help to find programs that manage energy and save money. In addition, they identify seniors who are eligible for “Project Reach” energy assistance. More than $344,000 in assistance has been given to 1,210 households.

While most companies surveyed agree that corporate philanthropy benefits the bottom line by projecting a positive company image, it must also serve a purpose within the community.

Giving without a plan or strategy to maximize benefits will lead to short-term, half-hearted campaigns that are ineffective for both the companies and the recipients.

The main beneficial motivations for corporate giving are:

■ Providing opportunities to engage with the company’s employees

■ Increasing customer loyalty

■ Protecting and enhancing the company’s reputation among consumers

■ Creating opportunities for business innovation or growth

The Corporate Philanthropy in Nevada 2015 report is a collaboration between the Moonridge Group, which serves as a catalyst between individuals, foundations and corporations, and the Nevada Corporate Giving Council.

A printed copy of the report is available by calling 702-570-7693 or sending an email toconnect@moonridgegroup.com.


Nevada on track to becoming leader in renewable energy

Jennifer Turchinj of Coda moderates a discussion of utility-scale renewable energy at a recent NAIOP meeting. Photo by Dana Berggren, NAIOP commercial real estate broker.

Jennifer Turchinj of Coda moderates a discussion of utility-scale renewable energy at a recent NAIOP meeting. Photo by Dana Berggren, NAIOP commercial real estate broker.

Despite the recent setback to residential rooftop solar, a panel of experts agree that Nevada is poised to become a leader in renewable energy.

The key to Nevada’s success could be the many utility-scale solar projects, such as the recently completed Crescent Dunes solar thermal project located in Tonopah and the Copper Mountain project outside of Boulder City.

When it comes to utility-scale solar, a lot has changed in the past 10 years. Where a one-megawatt system was at one time an incredibly large system, today’s systems range from 250 to as much as 600 megawatts. Companies are also doing it at a decreased cost. Depending on the technology, the cost to generate solar-driven energy has dropped from $10 per watt 20 years ago to between $2 and $3 per watt today. Contracts to purchase utility-scale solar energy have dropped from $130 to $45 per megawatt hour.

In addition, the cost of building a solar generation facility is cheaper than building a natural gas-fired generation plant.

The development of these utility-scale projects is also being encouraged by the Governor’s Office of Energy, which provides tax abatements and incentives for companies to build renewable energy projects in Nevada. “The program has been very successful; to date, the state of Nevada has invested $614 million in 28 renewable energy projects and received a return of over $6 billion on that investment,” said director Angela Dykema.

Another factor driving the increased construction is the state’s 1997 adoption of a renewable portfolio standard that mandates 25 percent of a regulated utility’s generating assets must be from renewable energy sources (such as solar, geothermal, wind and hydro) by the year 2025. NV Energy’s statewide renewable portfolio stands at 21 percent, and with more than 350 megawatts of solar energy still under construction, the state is well positioned to exceed that goal in the next nine years.

In fact, “it is Warren Buffett’s goal to make Nevada 100 percent renewable,” said Kevin Geraghty, vice president of energy supply for NV Energy. Buffett, who owns NV Energy, also owns MidAmerican Energy, which serves the state of Iowa and has just invested an additional $3.6 billion to complete the largest wind farm in the country, making Iowa the first state in the country to become 100 percent reliant on green energy.

“But, can we (Nevada) get to 100 percent green energy without raising rates? That is the Rubik’s cube to solve,” said Geraghty.

Producing renewable energy is like walking a fine line. Whereas gas-driven generators can be regulated at different speeds to produce electricity at various levels to fit the demand, renewable energy is either all or nothing.

A lesson can be learned from California, which has spent a lot of time and money promoting both rooftop and utility-scale solar renewable energy projects. On March 27, the California utilities had to completely shut down large renewable projects because they were overproducing energy. There have also been many times this year when, at 11 a.m., California paid Nevada $200 per kilowatt hour to take a small amount of renewable energy that was being overproduced. Likewise, on days of inclement weather, when California’s solar systems could not generate enough power, it has paid NV Energy up to $1,000 per kilowatt hour for Nevada energy to supplement its need.

Power purchase agreements between Nevada and other states within the Western states grid assure that power can be purchased at the lowest possible rates. The grid, like the interstate highway system and the Internet, is set up to benefit regions of the United States whereas state borders only serve to drive up the cost. The new Harry Allen generation plant tied to the Eldorado Valley transmission line, along with the One Nevada Transmission Line, are important additions to the ability of Nevada to deliver needed energy to California, Arizona and Idaho.

This informative panel discussion took place during the monthly NAIOP meeting and was moderated by Jennifer Turchin, principal architect with Coda Architecture, and a sustainability advocate. In attendance were major architects, engineers, contractors and commercial developers that shape the business and development of Southern Nevada.