State legislators who sponsored Nevada’s net metering legislation say the program is not being carried out as they envisioned.
Their comments came as the issue headed to the Nevada ballot and another alternative energy firm reduced its operations. Radiant Solar Solutions said it laid off most of its workers and may relocate to another state with more predictable energy policies.
Through net metering, utility customers with rooftop solar or other power generation capabilities are paid by the utility for power they supply to the common grid. Its purpose is to create incentives for residents to migrate to alternative energy.
Nevada’s Public Utility Commission (PUC) reduced payments to solar homeowners by half and imposed a usage fee—both actions were taken at the behest of monopoly utility NV Energy, a Warren Buffet property. The changes applied not just to new customers but to customers who installed solar because of incentives approved by the legislature. Many of those installations will now take longer to pay off. The changes have sparked an unusual surge of grassroots activism in the state.
Some sources say the PUC included the existing customers to give it something to surrender, without altering the new basic rate changes, if there was adverse public reaction.
Former Nevada Assembly speaker Lynn Hettrick and assemblymember Jason Geddes each sponsored one of three bills that created the state’s net metering policies in the 2003 Nevada Legislature. Both used the same term to describe their reaction to the PUC’s decision—“Disappointed.”
Hettrick said he does not believe NV Energy’s claim that non-solar customers are subsidizing solar customers.
“I don’t get the contention that the solar customers don’t pay their way,” he said.
So far, the only known study supporting the utility claim is one commissioned by NV Energy itself. A PUC study found otherwise.
Hettrick, a conservative Republican who served as deputy chief of staff for Gov. Jim Gibbons, said he had solar installed on his own residence, though he did not use the NV Energy credits available under the net metering program, but did receive federal credits.
“To tell me now that I have to pay more for a stand-by fee, I don’t agree with that,” he said. “They [the utility] make a profit on my investment.”
The italics were in his tone of voice.
Geddes, also a Republican, said he expected tax credits to be reduced or eliminated eventually, but that it should not have happened so soon “based on the fact that it [the net metering program] took so long to get up and going.”
And he said the decision should not have been made by the PUC, but by the legislature.
“This is a policy that they [legislators] put in place, involving economic development, jobs,” Geddes said.
That being so, he said, it was the legislature that should change it.
It is unusual for a state agency to undercut state government economic development policy.
Net metering in flux
“We’re struggling,” said Sunworker exec Shawn O’Meara. His Reno firm is just the latest to lay off most of its workforce. “We’ve done zero projects since the net metering decision,“ he said.
Two Nevadans sued NV Energy on Jan. 15, charging “anticompetitive actions, deceptive and unfair trade practices resulting in a restraint of trade, monopolization and maintenance of a monopoly over the electric utility in Nevada, price discrimination between different buyers, artificial price inflation, conspiracy to cause the aforementioned results through illegal means, and negligence.”
Meanwhile, Nevada’s newly unfavorable reputation in the alternative energy field continued to spread.
One green energy site ran the numbers to find out what would happen to Massachusetts solar customers if Nevada’s new rate structure were imposed in that state.
Under the headline “Nevada’s bizarre decision to throttle its own solar industry, explained,” another site, Vox Energy and Environment, reported, “For the state’s monopoly utility, it’s a successful attempt to avoid competition. For the well-funded conservative groups fighting the spread of solar around the country, it’s the first decisive victory. For most Nevadans, however, it represents an own goal, a senseless act of self-sabotage.”
The Los Angeles Times editorialized, “Here’s a simple guideline for the California Public Utilities Commission when it votes next week on a new rate scheme for rooftop solar users who also connect to the electric grid: Don’t be like Nevada.”
With support from solar firms, a Nevada group was formed under the name No Solar Tax PAC to place a measure on the ballot repealing the PUC decision. The petition has been posted on the secretary of state’s website.
While the Nevada utility commission was creating obstacles to rooftop solar, some other state commissions were trying to find ways to encourage it. In Vermont, where the cap on net metering is 15 percent of customers (3 percent in Nevada), the state’s Public service Board started accepting proposals for other ways solar can be encouraged.
In Mississippi, the state’s Public Service Commission increased the amount utilities must pay customers under the state’s net metering program.
On the other hand, some state commissions were yielding to utility pressures to curb solar incentives. The Hawaii Circuit Court upheld a Hawaii Public Utilities Commission decision ending retail rate net metering in the state.
Nor are all utility companies acting the same. In some states, particularly states with political leaders who support alternative energy, some utilities take different stances from NV Energy.
California’s Pacific Gas and Electric and New York’s Con Edison have been less hostile to alternatives and tying their efforts to plans for reducing greenhouse gases, even while—in PG&E’s case—still looking to curb net metering incentives. This has won them praise across the nation. The New Hampshire Business Review commented, “What Con Ed and PG&E understand is that the successful 21st century electric utility will sell much more energy, not less. Electricity, not gasoline, will power our cars. Electricity, not natural gas and oil, will heat and cool homes through efficient heat pumps.”
In Arizona, by contrast, Tucson Electric Power Co. is planning to use its next rate case to seek changes cutting savings for rooftop solar customers. It had hoped to do so earlier but was shot down by regulators.
The Los Angeles Times editorial commented, “Commissioners in California … have crafted a reasonable proposal that makes solar users pay to draw power from the grid when the sun doesn’t shine, while maintaining a healthy credit for the power they contribute during the day. The PUC is set to take a final vote on this proposal next week, but the state’s three big electric utilities—Southern California Edison, San Diego Gas & Electric and Pacific Gas & Electric—are agitating for last-minute changes to squeeze more money out of solar users.”