Exhibit 10(B)

                                August 4, 2000


Mr. Walter M. Higgins
4318 Whitewater Creek Road
Atlanta, Georgia 30327

Dear Walt:

          On behalf of the Board of Directors, I am pleased to offer you the
position of Chairman, Chief Executive Officer and President of Sierra Pacific
Resources.  Your primary work location will be Las Vegas, Nevada.  We expect
that you will assume your duties as soon as possible.

          Your starting base salary in this position will be $590,000.  You will
also be eligible for an annual cash incentive under the Company's Short-Term
Incentive Program of 65% of your base salary.  For the year 2000, we will pay
you $397,881, representing 83% of the incentive payment you would have earned as
of September 30, 2000, and would have received had you remained at AGL Resources
until about November 1, 2000.  The Company will also pay you one-half of 38% of
the year 2000 Sierra Pacific Resources Short-Term Incentive Program payment,
provided you meet certain expectations of the Sierra Pacific Resources Board of
Directors during the last part of the year, and one-half of 38% of the year 2000
Sierra Pacific Resources Short-Term Incentive Program payment based on the same
goals and under the same terms and conditions as exist for all other officers of
Sierra Pacific Resources.  Future payments of the short-term incentive is at the
discretion of the Board of Directors and will be based on corporate and personal
performance.  Actual payout may vary from 0% to 150% of target.

          Long-term incentives for the position are in accordance with the Plan
approved by shareholders and administered by the Board of Directors.  At this
time, long-term incentives consist of Non-Qualified Stock Options (NQSOs) and
performance shares.  For your position the long term incentive is targeted at
140% of your base salary. Although the 2001 grant of stock options has not yet
been finalized, I am projecting that you will receive no less than 104,000 NQSOs
effective January 2001.  The NQSOs vest one-third per year and are fully vested
after the third year. You will also receive a performance share grant of not
less than 13,200 shares effective January 1, 2001. The Board will decide the
performance measurement for the 2001 grant later this year. You will also be
eligible to participate on a pro-rata basis (28 of 36 months or 10,164 shares)
in the 2000-2002 performance share grant made earlier this year. The
measurements for this grant are based on the achievement of certain strategic
goals, which are outlined on the enclosed exhibit.

          As a special inducement for you to join Sierra Pacific Resources, the
Board has also authorized the following incentives.  A Restricted Stock Grant of
16,000 shares.  These shares will vest over a four-year period as follows:
4,000 shares in September 2002; 5,000 shares in September 2003; and 8,000 shares
in September 2004.  At the time of


Mr. Walter M. Higgins
August 4, 2000
Page 2 of 3


payment, the Company will provide you a cash payment grossed-up for taxes in
which to pay your income taxes on this stock grant.

          As Chairman and Chief Executive Officer, you will be expected to
maintain two times your annual compensation in Sierra Pacific Resources stock.
You will have five years to achieve this level.  Also, in addition, you will
receive a special stock option grant of 400,000 NQSOs at a strike price to be
set based on the closing stock price on the day you verbally commit to this
offer.  These options will vest 25% over the next four years and if the stock
price meets certain levels.

          You will be eligible to participate in the Company's Supplemental
Executive Retirement Plan ("SERP") and eligible for benefits under this Plan,
including a maximum benefit of 60% of your Final Average Earnings.  You will be
provided credit for your previous years of service plus the years you have been
with your current employer, but the benefits will be reduced by any other
qualified benefits you receive from AGL Resources or Louisville Gas & Electric.
If you are involuntarily terminated except for cause, you will be automatically
vested in the SERP and SERP benefits will be calculated as though you had
reached age 62.

          The Company will also provide you life insurance coverage of
$2,000,000 contingent upon completion of a physical exam performed by a doctor
selected by our insurance carrier.  This will be in addition to a $1,000,000
policy in the event that you die while traveling on Company business.

          You will be eligible for all regular employee benefits including a
401K plan that matches employee contributions dollar for dollar up to 6% and
Sierra Pacific Resources' Deferred Compensation Plan.  You will receive a
perquisite allowance of $30,000 to cover such expenses as a car, tax preparation
and club memberships.  The Company will, subject to Board approval and
discretion, bear the expense of memberships in appropriate clubs and facilities
at appropriate locations for the purpose of advancing and protecting the
business interests of the Company.  You will receive paid time off ("PTO") based
on your total years of professional work experience.  In 2001 your paid time off
allowance will be 33 days.  In 2000 we will provide you 15 days.

          In addition to the benefits described above, in the event you are
terminated for reasons other than (1) reasons relating to moral turpitude, (2)
conviction of any crime amounting to a felony, or (3) on your own volition and
without actually being requested to resign by the Board, you will receive within
thirty days of termination, one year base salary and target incentive.  This
payment shall be conditioned on the execution of appropriate releases in favor
of the Company for any and all claims connected with or arising out of your
employment or termination and will require continued maintenance of confidential
and proprietary information, a non-compete for one year and agreement not to
disparage the Company.  You will also be requested to sign a Change in Control
agreement that will provide you severance benefits including three times your
base and annual target incentive and grossed up for excise taxes in the event of
your termination resulting from a change in control.


Mr. Walter M. Higgins
August 4, 2000
Page 3 of 3


          This offer includes reimbursement for reasonable relocation expenses,
including travel, until your family moves, packing and transportation of your
household good, and commission on the sale of your home.

          As is Sierra's policy, all hiring offers are contingent on a drug
analysis test.  We can arrange for you to have this test at a time and place
convenient for you.  Also, you will need to provide us proof of U.S. citizenship
on your first day of work.  This would include a copy of your birth certificate,
driver's license, or social security card.

          The position being offered to you is one of trust and confidence.  In
accepting the position you are agreeing that, in addition to any other
limitation and regardless of circumstances or any future limitation or condition
of your employment, that, except as may be required by subpoena or other process
of law, you will not divulge, disclose or otherwise communicate directly or
indirectly to any person, agency, or entity any knowledge relating to documents,
transactions, or any confidential knowledge or proprietary information which you
acquire with respect to the business of Sierra Pacific Resources or any of its
affiliated companies

          To indicate acceptance of this offer, please sign below and return one
signed original of this letter to Mary Jane Reed, Vice President, Human
Resources, as soon as possible.

          The Board of Directors and I are delighted you have accepted the
opportunity to join this Company.  We believe, with your contribution, we will
accomplish great things for our shareholders, our customers, our employees and
our communities.  Welcome aboard!

                                        Sincerely,


                                        James R. Donnelley
                                        Acting Chairman of the Board


JRD:jan
HIGGINSAGRMT


Accepted:



By__________________________
  Walter M. Higgins