Review proposed for rates of homeowners who install solar systems

CARSON CITY — Homeowners who install solar systems to reduce their power bills could one day find themselves paying more for the privilege.

The state Public Utilities Commission is moving forward with a review of whether households that produce some of their own energy to save on their utility bills, called net metering, should be put in a separate class for rate-setting decisions.

The analysis of whether the two classes of customers should be created was sought by the Attorney General’s Bureau of Consumer Protection.

An official with the office said Monday the jury is still out on what the investigation will show about net metering customers.

But the Sierra Club, in a filing opposing the review, argued that the request is based on the “unsupported assumption” that net metering customers create a disproportionate cost on NV Energy’s system compared to customers who do not self-generate.

“The assertion that net metering customers are unfairly burdening other customers is often put forward by utilities or other interests seeking to undermine the growth of distributed generation, and it is an argument that is usually either untrue or severely overstated,” the Sierra Club said.

While the petition by the Bureau of Consumer Protection did not say that net metering customers should be charged higher rates, it has in past filings made statements that net metering customers should pay higher fixed charges, the environmental group said.

Until there is evidence of any costs associated with net metering, “then it is premature to consider punishing net metering customers for engaging in an activity that is strongly supported in Nevada policy and law,” the group said.

The commission on June 4 granted the request for the review, noting that it is only an information-gathering investigation.

The commission said that such a review is warranted, given net-metering customers’ “seemingly unique characteristics” which could result in “the most just and reasonable rates for all customers.”

Dan Jacobsen, technical staff manager for the Nevada Consumer Advocate, said the filing did not propose to require net metered customers to pay more. But because their electricity use pattern is different, it should be reviewed, he said.

About 2 percent of NV Energy’s customers have solar panels, and they are typically more affluent homeowners, Jacobsen said.

There are state policymakers who believe that net metered customers do not pay enough to cover the huge fixed costs incurred by the utility to provide service, from the cost of power lines to the delivery of the monthly bill, he said.

Another view is that net metered customers should pay less because they ease the burden on the utility by not triggering new construction such as transmission lines, Jacobsen said.

NV Energy, in its general rate case filed last month for Southern Nevada customers of Nevada Power, has proposed to increase the fixed monthly charge paid by all residential customers to $15.25 from $10, he said.

But if the issue is with net metered customers, then it should be addressed specifically rather than taking a broad-brush approach and raise the fixed monthly charge rate by more than 50 percent for everyone, he said.

In its comments, NV Energy objected to a request that the review be made part of its general rate case filed in early May. It did not oppose the review itself.

The PUC ruling did not make the review part of the general rate case.

Jennifer Schuricht, public relations manager for the southern region of NV Energy, said the region has 2,455 net metering customers with 35.8 megawatts of net metering installed.

A state law says the total amount of net metering cannot exceed 3 percent of the statewide peak load, she said. The state is now only at about 31 percent of that cap, Schuricht said.

Black Rock Solar, a nonprofit that provides clean energy to low-income and educational sectors, argued that any such review should wait until a report on net metering is submitted to the PUC by July 1.

The report, which will examine the costs and benefits of net metering in Nevada, is being conducted as required in Assembly Bill 428 passed in the 2013 session.

Contact Capital Bureau reporter Sean Whaley at swhaley@reviewjournal.com or 775-687-3900. Follow him on Twitter @seanw801.