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September 22, 2017

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Regulators take ‘a first step’ toward restoring rooftop-solar rates

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COURTESY

In this file photo, Vivint Solar employees install solar panels on a home.

One year after a controversial decision to slash credits for rooftop-solar customers in Nevada (and given a recent shake-up by Gov. Brian Sandoval), utility regulators wanted a course correction. Riffing on the Abraham Lincoln quote that “bad promises are better broken than kept,” they called 2016’s rate structure a “promise better left unkept.”

The state’s Public Utilities Commission issued a unanimous decision Dec. 22 that rebuked and largely dissolved the rate structure that went into effect last year and was blamed for bringing Nevada’s rooftop solar industry to a halt. Though the decision was limited in scope, regulators indicated that they wanted to revisit rooftop-solar rates, the subject of a costly political battle between NV Energy and service provider SolarCity last summer.

“We need to restart a conversation,” PUC Chairman Joe Reynolds said during the hearing. “I think this case and these challenges can be overcome, and we can get there with the help of all the stakeholders, including the Legislature and the members of this commission.”

The PUC’s decision, part of a triennial proceeding to determine electricity rates for NV Energy’s Northern Nevada customers, provides for a limited restoration of the state’s rooftop-solar market.

At issue was the value of credits customers should earn for sending their excess solar power back to NV Energy under a program known as net metering. Solar customers had relied on these credits to offset the cost of their panels, until last year’s ruling established that the rate would be dramatically cut by 2020 — from 11 cents per kilowatt-hour to 2.6 cents — while the monthly service fee nearly tripled, from $12.75 to $38.51. A coalition of renewable-energy advocates and solar companies convinced the PUC to restore the more advantageous rates in its Dec. 22 decision, which will permit about 1,200 Northern Nevadans to sign up for solar under the pre-2016 credit.

The PUC will not consider Southern Nevada’s solar rates until a proceeding at the end of 2017 and said in its order that the Northern Nevada decision should not serve as “binding precedent.” But it’s a meaningful reversal for a commission that had, until several months ago, continued to defend its prior decision to reduce the net-metering credit and increase fees for all solar customers.

Sara Gersen, an attorney for the pro-solar nonprofit Vote Solar, called the decision “a first step in the right direction.”

“For Southern Nevada, the most significant thing about this decision is the signal that the commission is ready to give rooftop-solar policy a fresh look,” Gersen said.

When the PUC initially changed the rates, national rooftop-solar installers SolarCity and Sunrun pulled their operations from Nevada, arguing that the new structure made solar economically disadvantageous. Neither firm commented about plans to return to Nevada after the December decision, and both likely are waiting for a more sweeping statement of the state’s solar policy.

In its order, the commission said that it only extended net metering to about 1,200 customers as a stopgap measure while policymakers and regulators continue exploring the value of rooftop solar.

“Like gasoline or milk, the value of (net metering) rooftop-solar energy in Nevada is not static — it is subject to change, like other commodities, and ebbs and flows with things like the economy and the weather,” read the PUC’s summary of its recent decision. “Resolution of valuation of (net metering) issues in Nevada requires more study and collaboration.”

Some are calling on the Legislature to provide more guidance for the rooftop-solar market, as lawmakers gavel into session in February and are expected to act on a number of energy policies.

“This order won’t bring back the jobs lost in the last year,” said Andy Maggi, executive director of the Nevada Conservation League, “but it artfully frames the problems with previous PUC actions, the current discussion and the need for legislative action.”

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