Lawmakers want new rooftop solar fees, don’t lift cap

Senators dealt a crushing blow to the rooftop solar industry Saturday, passing an amendment that would do little to address a cap limiting industry growth. At the same time, it would allow the Public Utilities Commission to levy three new fees on customers who want to generate carbon-free electricity.

The amendment is the latest development in a hard-fought, behind-closed-doors battle between the solar industry and NV Energy over net metering, under which NV Energy offers customers a reduced rate for powering their homes and the grid with rooftop solar panels. NV Energy denounces net metering, calling it a subsidy and saying solar customers benefit from the policy at the expense of non-solar customers.

The utility, owned by Warren Buffett’s Berkshire Hathaway Energy, has fought in courts, utility commissions and legislatures nationwide to limit or kill the policy. It has had little success in states such as Utah, Idaho and Washington. Adding new fees and stalling a cap increase in Nevada would be a huge victory for Buffett’s utility conglomerate. NV Energy declined to comment for the story.

The amendment would allow the PUC to levy as many as three tariffs on net-metering customers’ power bills and give the commission some new regulatory authority. The legislation comes as the solar industry implores lawmakers to lift a cap that limits how many NV Energy customers can participate in net metering, warning that the threshold will be reached by fall. Companies such as SolarCity and Sunrun say that unless the cap is raised, they will be forced to slash a majority of the 6,000 jobs they’ve created in a state that touts the most solar jobs per capita.

The state caps participation at 3 percent, and NV Energy says it will lose $8 million for every 1 percent it increases.

The number represents 3 percent of all utility customers consuming energy during the highest level of demand on the electric grid in a given year, which is about 7,500 megawatts (a Super Wal-Mart consumes three-quarters of a megawatt per year). Nevada is one of 44 states with a net-metering program. More than 2,500 customers participate statewide.

The utility has attacked the policy in the past two months, lobbying against it, buying newspaper ads and opposing the cost on its website.

The amendment passed with a voice vote and marked the first time lawmakers took public action to address net metering this session. The session began with a draft measure to lift the cap to 10 percent; the measure was never introduced. Lobbyists from the utility and solar industry have not held any public debate on the matter in front of lawmakers.

Since the session began, the solar industry has had a handful of private meetings involving Gov. Brian Sandoval and his staffers, state lawmakers and NV Energy lobbyists that produced no compromise. The solar industry was hoping the measure would mandate that the PUC have a hearing on lifting the cap, but lawmakers did not include that in the bill. Instead, the amendment would mandate that the PUC study net metering every three years. That provision, which doesn’t outline any authority to increase the cap, could stall growth for the rooftop solar industry.

Sandoval, whose economic development office gave SolarCity $1.2 million to relocate from California to Nevada, is neutral on the matter. At least two of his policy advisers lobby for NV Energy. U.S. Sen. Harry Reid told the Las Vegas Sun this week that he supports lifting the cap.

The legislative inaction on net metering spawned rallies, ads and alliances the solar industry had not foreseen coming into the session. This past week more than 70 rooftop solar employees swarmed the halls of the Legislature to lobby their representatives. Net metering, along with other energy policies the Legislature hasn’t addressed this session, spawned the formation this past week of the Nevada Coalition to Protect Ratepayers, which includes the Las Vegas Sands, Wynn Resorts, SolarCity, Sunrun and Switch.

The coalition, which includes members of another solar group, The Alliance for Solar Choice, was dismayed at the amendment but hopeful changes will come if it moves into the Assembly.

“The Nevada Coalition to Protect Ratepayers and the thousands of solar employees we represent have anticipated a public hearing concerning the future of rooftop solar,” said Bryan Miller, co-chairman of the coalition. “To this date we have not received one. It is our hope that as this legislation moves to the Assembly, Chairman Kirner will provide the public hearing all Nevadans deserve.”

A bipartisan group of senators sponsored the amendment in S.B. 374: Sens. Patricia Farley, R-Las Vegas, Kelvin Atkinson, D-Las Vegas, Pat Spearman, D-North Las Vegas, and James Settelmeyer, R-Minden. The bill has one more vote before moving to the Assembly. Lawmakers who approved the measure said working on policies for fees and cap increases should not fall to the Legislature.

“The PUC is the right place to come up with those numbers,” Farley said. “We’re not the experts.”

The solar industry worries that waiting for the PUC to deliberate on net metering could cost precious time. It also fears the potential tariff on net metering will deter customers.

The fiscal benefit of net metering — reducing power bills by about 20 percent a month — may pass from the customer to the utility with the proposed amendment.

Arizona implemented a fee that amounts to a $5 to $7 net metering charge for the average homeowner. A fee is pending in Wisconsin. Regulators, courts and lawmakers in Utah, Idaho, Maine, Oklahoma and Indiana opposed fees. Utility companies in more than 30 states have unsuccessfully fought to eliminate net metering or impose fees.