PUC denies NV Energy bid to triple service charge in Northern Nevada

BY: DANA GENTRY, Nevada Current

In a rare victory for NV Energy consumers, the Public Utilities Commission of Nevada voted Tuesday to reject the utility’s bid to nearly triple the basic service charge for Northern Nevada customers from $16.50 a month to $45.30 a month, “a number that I believe is much too high,” Commissioner Randy Brown said during the hearing.

The commission instead approved a $2 monthly increase to $18.50.

“This is an increase of 12% as opposed to the 175% increase Sierra Pacific has asked for,” Brown said, adding the hike in the service charge “balances the need for Sierra Pacific to cover rising fixed costs while still adhering to the principles of gradualism in rate-making that protects customers from rate shock.”

Critics said NV Energy’s proposed hike was designed to protect the utility’s revenue streams from competition with solar and other green technologies.

Low-income residents, those on a fixed income, and customers who invested tens of thousands of dollars in rooftop solar, told the PUC they would be disproportionately harmed by the massive proposed hike in the monthly service charge.

“We have done everything that’s been asked of us,” Northern Nevada resident Melanie Krause said during public comment, suggesting the utility was trying to “punish” customers for saving energy and not producing enough revenue for the utility. “We freeze in the winter by turning our heat down. We boil in the summer by shutting our AC off. With the huge rate they originally asked for, you’d be out nearly $50 a month if you didn’t even flip on a single light switch.”

Brown noted more than 250 customers commented on the proposal during the course of three consumer sessions.

“While it is true that the public comments are not evidence, consumer input on these issues is welcomed and encouraged, and the public participated in these dockets in unprecedented numbers,” Brown said.

NV Energy’s proposal, which was confined to the north, was designed to stabilize energy bills, according to the utility, which sought to increase its rate of return to investors from 9.5% to 10.4%. However, the PUC approved a 9.65% return on equity for Sierra Pacific’s electric division and a 9.5% return on equity for its gas division.

The PUC’s action is a victory for consumer protection and for green energy, says Emilie Olson of Advanced Energy United, a trade group for renewable energy companies.

“We were worried the increase would be a disincentive to consumers who are exploring energy conservation – retrofits to their homes or rooftop solar –  largely for economic motivations,” Olson said during an interview, adding other consumers who are motivated by environmental sustainability could get “slapped with a fixed charge regardless of what choices they make. It seems punitive.”

The $2 increase will appear on customers’ bills in October.

This story was originally published by Nevada Current and has been republished under a Creative Commons license.