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November 22, 2014

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j. patrick coolican:

Harry Reid to get in NV Energy’s face during remarks to Legislature

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AP Photo/Cathleen Allison

U.S. Senate Majority Leader Harry Reid speaks to a joint session of the Nevada Legislature on Tuesday, Feb. 22, 2011, at the Legislature in Carson City.

J. Patrick Coolican

J. Patrick Coolican

Sen. Harry Reid has a history of taking on NV Energy, the state’s electric monopoly, and will do so again today in his biennial speech to the Legislature in Carson City.

According to sources familiar with the speech, Reid will talk broadly about diversifying Nevada’s economy and specifically press legislators to strengthen the state’s renewable energy mandate.

A law known as the renewable energy portfolio sets out the percentage of energy delivered to Nevadans that must come from renewable sources such as solar, wind, geothermal and hydroelectric.

In 2005, lawmakers ramped up the requirement — 15 percent of energy in 2011 had to come from renewables, increasing to 25 percent in 2025.

I’m told Reid will recommend the Legislature at least take a look at expanding the renewable requirement. California is increasing its requirement to 33 percent by 2020. Colorado is moving to 30 percent by 2020 for its large utilities.

The mandate and ones like it in other states have spurred research and investment in renewable energy, helping drive down costs.

The problem with Nevada’s renewable requirement is that NV Energy has used its juice in Carson City — the company is one of the biggest financial contributors to political campaigns and has a slew of connected lobbyists — to carve out loopholes. Reid is expected to tell the Legislature that at the very least it needs to close the loopholes.

One allows the company to win credit toward the renewable requirement by investing in energy efficiency. Encouraging energy efficiency might be good policy, but it has nothing to do with investment in renewable energy.

My colleague David McGrath Schwartz reported last year on another loophole that allows the company to store up renewable credits over time, like in a bank, allowing it to skate on it in future years.

The utility has been buying significant amounts of its renewable energy out-of-state, including hydroelectric power from some Idaho dams that are as much as 100 years old.

According to 2011 filings with the Public Utilities Commission, by one measure, one-third of the utility’s renewables came from these sources, while just 9 percent came from solar power.

But the worst part is that when the company exceeds the renewable requirement, it can carry forward renewable credits to future years. So, in prior years the company has been buying renewable energy from out of state, exceeding the renewable requirement and rolling forward the surplus into future years, obviating the need for future investment in renewable energy here in Nevada.

“The utility is able to meet the standard for the rest of the decade without investing in another megawatt of renewables in Nevada,” said a source familiar with Reid’s speech.

This makes the renewable requirement meaningless. Indeed, instead of leading to a rush of solar power capacity, more than 90 percent of the fuel we consume comes from outside the state, according to the U.S. Energy Information Administration.

The problem is that without demand for renewable energy, there won’t be investment in new solar — investment that will lead to cost-saving innovations so that solar can become more competitive with fossil fuels.

We want renewable energy investment because we have a lot of sun and wind and geothermal and should be able to benefit from the new technology.

Just as important, greenhouse gas emissions and global warming aren’t some abstract, in-the-future problem. Scientists fear climate change could worsen water shortages in the Southwest, which means we have a real stake in a cleaner energy future.

The company has previously said the short-term contracts to out-of-state providers were the only way to meet the renewable requirement while holding down our power bills.

Developing renewable energy here in Nevada is more expensive, though not as much as you would think if you factor in the enormous costs that will eventually be associated with climate change.

And, the only way to bring the cost down is investment, the kind that was supposed to result from the renewable requirement.

Here’s what the company tells me: “NV Energy has made remarkable progress with its renewable energy portfolio, and our customers are now benefiting from nearly 40 geothermal, solar, wind, biomass, waste heat recovery and small hydro facilities throughout Nevada. We look forward to continuing to work with Sen. Reid, Gov. Sandoval, our Legislature and regulators to constantly improve our energy portfolio in the best interests of the state, our customers and our shareholders.”

Call me crazy, but I suspect shareholders hold more sway with company executives than the state or customers.

A company spokeswoman said last year that by 2013, NV Energy didn’t expect to be making any more of those out-of-state purchases.

If that’s the case, then the utility shouldn’t have a problem if the Legislature moves to close the loophole. We shall see.

Reid has taken a tough line with the utility before, opposing new coal plants and calling for the closure of the Reid Gardner coal plant. If Reid really engages on this fight on the renewable requirement, it should be fun to watch.

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  1. NV Energy deserves what Senator Reid gives them.

    This company doesn't care two hoots for anything but what it can extract from ratepayers to line their pockets with. They get that through lobbyists providing template legislation to be rubber stamped.

    I have not one iota of sympathy for NV Energy.

    Go get them Harry!

  2. "The utility has been buying significant amounts of its renewable energy out-of-state, including hydroelectric power from some Idaho dams that are as much as 100 years old."

    I'd love to see the cost vs profit on that. Who are the suppliers?

  3. We're told to conserve energy.

    Then when we do, NV Energy raises the rates because not enough energy is being used.

    Then, we're told to use more energy.

    Then when we do, NV Energy raises the rates because they need to generate more energy to suit the consumers' needs.

    Then, we're told that in order to keep rates down, they sell excess energy to California.

    Then when that's accomplished, NV Energy raises the rates because there's not enough energy for Nevada consumers and they need to kick into overdrive to meet the needs for both California and Nevada.

    Then, we're told the new "smart meters" need to be put in and it will save money because a guy don't have to come out and look at them anymore, saving money.

    Then when we do have the "smart meters" installed, we're charged more for them.

    Then, we're told that if we don't take the "smart meters," we would be charged extra because a guy has to still come out and look at the old meters.

    Does anyone see a pattern here except me?

    Senator Reid, you need to smack them. And smack them hard. They aren't interested in providing an adequate, affordable service to residents of Nevada. They are only interested in sticking it to us.

    They are counting on their meters being smarter than the residents of Nevada.

    All I can say is...smack 'em really, really hard, Senator Reid. The people out here are not victims waiting to happen to their eternal need for more money, more money, more money.

  4. When you are a MONOPOLY, you run the show, and as we see AND know, NV Energy is truly a monopoly, and as Commenter Bob Realist suggests, Senator Reid should go after NV Energy using the Sherman Anti-Trust Laws to compell these exploiters of the vulnerable public to do right. Their track record is an indictment against them and their malicious treatment of public trust.

    Time is ripe for change.

    Blessings and Peace,
    Star