Outrage over NV Energy "Bait and Switch"

By John Kennedy
January 21, 2016

NV Energy's newly implemented solar price increase has been met with disbelief and outrage. Just days ago, two NV Energy solar customers filed a lawsuit against Las Vegas electrical utility NV Energy. Their grievance with the company stems from NV Energy's recent decision to impose increased rates across the board for their solar customers. Unlike proposed rate hikes in Arizona and other states, Nevada's price increase is seen as particularly unfair as it applies to both new solar customers, and all previous solar customers as well. As many Nevada residents bought and installed panels under the assumption that they would save money in the long run, the case raises worry about NV Energy's ability to change the rules of the game as they please.

The price increase, which was put into effect toward the end of 2015, amounts to a nearly 40% increase in monthly bills. It was implemented in tandem with reductions to net metering credit, allowed by the Nevada Public Utilities Commission, lowering rates from $0.11 to $0.09 in its first year, and lowering them to below $0.03 by 2020. As a result of the price hike, the incentives that caused so many to adopt solar in the first place have been effectively eliminated. The case's plaintiffs for instance claim they each spent roughly $40,000 on their solar systems, money they would have saved had they been aware of the impending rate changes.

As the increase did away with any economic incentive to go solar, several major solar installers have been forced out of Nevada entirely. Solar City, Sunrun, and Vivint all put an end to their Nevada operations, causing hundreds to lose their jobs. This in turn has caused some to regard NV Energy's actions, in addition to being grossly unfair to existing solar customers, as being anticompetitive in nature. This suspicion is the basis for the case against the utility. They are accused of violating the Nevada Deceptive Trade Practices Act as well as the Nevada Unfair Trade Practices Act in an attempt to maintain their monopoly on electricity provision in the state.

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While many believe this reduction of solar incentives was designed to drive away solar competition, NV Energy claims it is a legitimate means to shift the burden of grid maintenance from their non-solar customers. They claim these customers have been covering a disproportionate amount of the grid maintenance costs, while solar customers pay for less than their fair share. However, even if this is ruled to be the case, NV Energy isn't out of hot water. The utility is also accused of providing false information to the state regulator in order to have the increase passed.

Many anxiously await the case's outcome, and though it will likely not be resolved soon, democratic presidential hopefuls Hilary Clinton and Bernie Sanders have publicly voiced their support of Nevada solar customers. Also, with roughly half of all states countrywide considering similar changes to their net metering programs, the ruling on this case is sure to be an influential one.







John Kennedy

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