NV Energy signals opposition to deregulation ballot question, as regulators prep for first major study of the Energy Choice Initiative
- December 27, 2017
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Without stating it outright, NV Energy has taken its most adversarial stance yet against a proposed ballot initiative that would entirely reshape
The utility submitted some of its most strident criticism to date of the Energy Choice Initiative as part of a 256-page filing it submitted to the state's
In the filing, NV Energy - which has thus far maintained neutrality on the ballot question - estimated that the change to a retail energy market would cost between
"Nevadans thus face a critical choice to abandon the system that has provided a reliable and low-cost service that is essential to the health, safety and welfare of Nevadans, or undertake an undefined and risky experiment with a key input to the State's economy," the utility wrote. "There is a better way to advance the State's goal of providing low-cost electricity and adding renewable energy."
In an email, Energy Choice Initiative advisor and former Federal Energy Regulatory Commission chairman
"It was shocking to see NV Energy use a Commission proceeding to campaign against a ballot question ratified already once by an overwhelming majority of
The utility's filing wasn't the only comment submitted to the PUC. At least 40 filings, from major businesses, small counties and major
The ballot question - which passed on a 72-28 percent margin in 2016 and is backed by a who's who of
Outside of NV Energy, opposition in the filings came from an eclectic group of sources, from tiny
Friday marked the first deadline for the PUC's docket - replies to written comments are due on
The commission's final report, expected to be published sometime next year, is widely considered to be one of the most important initial steps in preparing for a possible retail energy choice future - it will likely play a major role in determining the recommendations made by the Governor's
Here's an initial look at what the Commission will be analyzing, discussing and weighing over the next month:
The utility's lengthy filing with the PUC attempts to accomplish two goals - to promote NV Energy's current activities and future goals, and contrast them with what it calls "experimental, unregulated retail markets - but without a road map."
The filing lays out an overall view of the utility, from its service territory (most of
It also laid out a number of concerns that it already raised to members of the
The utility estimated that joining an ISO or other wholesale market would take until 2025 at the earliest, and estimated that costs as a whole would range between
Clean energy advocates and trade groups have, for the most part, stayed away from taking a position on retail energy choice, though several groups filed comments in the docket. They urged utility regulators to consider policies that enhance renewables if voters approve retail competition.
Like other renewable groups, Western Resource Advocates wrote that it was neutral on retail competition but supported the idea of creating competitive wholesale markets. It views these markets as a prerequisite to retail choice and essential to keeping
"The Energy Choice Initiative was intended to reinforce, rather than replace,
Another question these groups addressed is the future of energy efficiency programs in a restructured market.
"As such, it is emblematic of the essence of customer choice," the group wrote in a filing. "And there should be no question that the program should continue in an energy choice future."
Solar, geothermal and hydropower producers
Utility-scale renewable developers
"The [companies] have concern over the potential divestiture of these agreements by NV Energy," they wrote. "Any such divestiture could affect the long-term viability of financing renewable projects in
A trade group that represents some big players in the retail energy space, including Constellation and
"The two fundamental elements necessary for a vibrant competitive market are willing buyers (consumers) and sellers (competitive energy suppliers)," the organization stated in its filing. "Buyers must be free to choose the competitive supplier that will best meet their needs, supply their electricity services as promised, and enter into a clear and concise contract for these services. Sellers must be free to develop products and services based on competitive market necessities (reliable supplies) and signals."
If implemented properly, RESA makes a case that the market could benefit consumers, with more options, create natural incentives for conservation and bolster the
As for the transition to retail competition, the trade group supported the use of a competitive auction to sell NV Energy's generation assets. One big question that NV Energy has raised is around what to do with about 46 power-purchase deals, long-term contracts in which the utility has committed to buying a certain amount of energy at a fixed price for dozens of years.
"How to transition the existing long-term power contracts from the utility is one that will require additional review and discussion among policymakers and stakeholders," the trade group wrote.
One suggestion has been to sell the contracts on the newly created market and recover any remaining costs. Regulators, who approved the deals, could then ensure they are honored.
It also supported some consumer safeguards, such as licensing requirements for suppliers.
The trade group said its filing was intended as a "guidebook" for the process: "By using the experience of numerous jurisdictions that have transitioned from the historical monopoly regulated structure and in which many of RESA members compete to provide the products and services that consumers desire,
Many of the filings also came from localities, many of which have a vested interest in the outcome of the Energy Choice Initiative.
"Residents voted against an open, competitive retail electric energy market because the presence of our existing rural electric cooperative provides the necessary services in an efficient, cost-effective manner,"
Not all electric cooperatives submitted letters of opposition to the PUC -
"Members of the NREA know how to purchase power on the wholesale market and their ability to do so should not be impeded," the group wrote.
The city of
Several other groups without a seemingly direct connection to
"By welcoming this type of competition,
While purportedly not taking a stance on the ballot question, the
Still, the organization laid out several consumer protection guidelines for states with or considering retail choice, including a standard default service, prohibiting variable rates in electric contracts and addressing "unfair terms and conditions in provision and marketing" in retail energy plans.
Two chapters of the
Story provided courtesy of The Nevada Independent www.nevadaindependent.com .
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