Compromise between NV Energy, solar in works as lawmakers vet bill

John Locher / AP

After months of intense lobbying between the solar industry and NV Energy, lawmakers debated how the state should raise a controversial solar cap and increase the cost of generating electricity with rooftop solar installations.

Officials and lobbyists on both sides offered their opinions on Senate Bill 374, in the Assembly’s Commerce and Labor Committee on Wednesday, marking the first public debate on a conflict that’s sparked national headlines, ads, rallies and an outcry from constituents asking lawmakers to raise the cap.

The debate pits a dominant power company against an emerging industry in a state with more than 300 days of sunshine and the No.1 national ranking of solar jobs per capita.

The lawmakers and lobbyists didn’t make a final compromise on a policy called net metering, which allows homeowners to power their homes and provide energy to the grid with solar panels. But they worked on a solution to shift cap-lifting responsibility from the Legislature to the Public Utilities Commission. It also mandates the PUC to implement a new tariff on ratepayers who want to participate in net metering by December. The fee would increase rates on the service, demand and energy charges on power bills.

Lawmakers say net metering is the second most lobbied bill of the session next to proposals on calling to legalize ride-sharing services like Uber. They say that thousands of emails have flooded their inboxes this session asking them to do something about the cap.

There are 13 days left in the session and time is running out for lawmakers to pass a measure that will balance raising the cap with NV Energy’s concerns about nonsolar ratepayers who are subsidizing net metering customers.

NV Energy, owned by billionaire Warren Buffett’s Berkshire Hathaway Energy, says net metering is a subsidy that gives rooftop solar customers a credit on their bills for generating electricity that goes to the grid. It’s fought in states around the country to add tariffs or end net metering. It was unsuccessful adding tariffs in Idaho, Utah and other states.

The utility says the credit — which amounts to around 6 cents per kilowatt-hour — is an unfair burden on nonsolar customers. The utility currently caps participation in the program to 3 percent of its peak generating demand, which is 7,500 megawatts (a Super Walmart consumes around three-quarters of a megawatt per year). The utility says ratepayers will pay $8 million for every percentage point the cap increases. More than 2,500 Nevadans participate in the program.

The average home consumes 10,900 kilowatts per year. The Legislature raised the cap four times since 2005, with the last increase passing two years ago. More than 2,500 Nevadans participate in the program.

The utility supports the current proposal. Shawn Elicegui, NV Energy senior vice president of regulatory and strategic planning, said the PUC is the right forum to address the cap.

The solar industry says the cap is likely to be hit by fall and if not lifted will force layoffs. Companies like SolarCity and Sunrun, which lease solar panels to consumers to participate in the program and provide more than 2,000 solar jobs to the state, were there to lobby on the measure.

The bill is a compromise but not what the solar industry wants, said Bryan Miller, senior vice president of public policy at Sunrun.

“No one gets everything they want in politics,” he said.

The current version of the bill says that if the cap is hit before December, a temporary tariff will go in effect. Solar lobbyists asked lawmakers to remove that provision and an amendment to the current proposal that will grandfather into the system the rates for current net metering customers.

Former GOP Gov. Bob List, a lobbyist for SolarCity, said the company will support the plan with the minor tweaks.

“We’re not asking for a handout,” he said. “We’re asking for a level playing field.”

While NV Energy has unleashed an army of lobbyists to stop net metering, solar has worked to try to increase the cap. At the beginning of the session there was a bill to increase the cap to 10 percent. But it never had a hearing.

The solution isn’t ideal for the solar industry, but it provides certainty for raising the cap in the future.

Sen. Patricia Farley, D-Las Vegas, sponsored the measure. She said shifting responsibility from the Legislature to the PUC is the best option for the state.

“By setting this up in the PUC it is putting it in the right place with the right people,” she said.

The net metering debate is shrouded in complex laws and has created confusion among lawmakers who are learning more about the policy with the bill. Rose McKinney-James, a lobbyist for consulting firm Energy Works and participant on solar conversations for more than two decades, supports the plan in the works and was able to quell some of the confusion about how the policy works in the state.

The Legislature cannot leave Carson City without a statutory solution, she said.

“It has been challenging to bring this to the Legislature each session because of the changing landscape and complexities,” she said. “It is important to bring certainty to net metering and to the solar industry. We began this program two decades ago with commitment from only 100 customers ... We’ve now grown to thousands of customers.”

Assemblywoman Marilyn Kirkpatrick, D-Las Vegas, said the conversation from net metering is far from over in the session.

“I just want consumers to be able to have options,” she said. “I want consumers to be protected … I want ratepayers to stop subsidizing an industry that’s doing well.”