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June 27, 2016

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SolarCity lays off more than 550 workers in Nevada

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Kyle Roerink

SolarCity workers practice installing solar panels at the company’s new facility in Las Vegas.

SolarCity has laid off more than 550 employees — about a quarter of its workforce — in Nevada, the company said today.

The news comes two weeks after SolarCity announced it was halting the sale and installation of rooftop solar panels here after utility regulators approved cutting the rate NV Energy pays solar customers for generating excess power. The new rate went into effect Friday.

The company plans to keep some employees in Nevada to service existing customers and said it would work to relocate some employees to other states.

SolarCity, one of the largest providers of rooftop solar in the nation, also began dismantling a Las Vegas training center on Tuesday. The center opened in November to train employees from Nevada, Colorado, Texas and Arizona.

SolarCity will also close three warehouses in Henderson, North Las Vegas and Reno, officials said.

For now, SolarCity plans to keep open its Las Vegas headquarters, which includes a service center for which the company received up to $1.2 million in state economic development funding in 2013.

Many employees were notified of the terminations on Dec. 23, the day after the Public Utilities Commission approved the controversial rates for solar customers, a company spokesperson said.

The spokesperson could not recall a layoff of this size ever occurring at the company, which was founded in 2006 and backed by Tesla and SpaceX founder Elon Musk.

“Telling employees they can no longer work for SolarCity is the hardest thing we’ve ever done,” Lyndon Rive, the company’s CEO, said in a statement. “These are hard-working Nevadans and a single government action has put them out of work. This is not how government is supposed to work.”

Last month, the PUC, which regulates NV Energy, approved new rates that gradually increase a fixed service fee for solar customers and reduce the value of credits solar ratepayers earn for generating excess electricity.

Under the new rates, Southern Nevada solar customers this year will pay a fixed monthly fee of $17.90, up from $12.75. By Jan. 1, 2020, the fee will rise to $38.51.

Until Friday, NV Energy reimbursed solar customers about 11 cents per kilowatt hour for the excess energy they generated. That was cut to about 9 cents on Friday and will drop to 2.6 cents in 2020.

Companies like SolarCity say the new rates make solar too expensive, rolling back an industry that has about 17,000 customers and has created thousands of jobs.

NV Energy argued solar customers had avoided paying some of the utility’s fixed costs in the past, which resulted in other ratepayers subsidizing solar customers. The new rates, it argued, compensated for that cost shift.

The solar industry and the state’s Bureau of Consumer Protection are challenging the rate change. The PUC next week will consider a request to pause the rates.

Gov. Brian Sandoval said Tuesday he has always been a supporter of the solar industry, but there are legitimate public policy questions the PUC must weigh. He said that includes finding the right balance of subsidy for the solar industry.

He said he would not try to influence the PUC, which he appoints. But he noted that he has urged SolarCity and other industry players, if they disagree with the rate ruling, to seek judicial review or request the commission reconsider its decision.

“There’s still a lot of process,” Sandoval said.

In its statement today, SolarCity said it had been trying to contact Sandoval since the ruling.

“I’m still waiting to speak to the governor, but I am convinced that once he and the commissioners understand the real impact, that they will do the right thing,” Rive said in the statement.

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