NV Energy CEO criticizes Energy Choice ballot amendment
MINDEN, Nev. — The president and CEO of NV Energy told a business luncheon on May 23 that while energy choice should be good for major electric customers, it likely won’t be for residential customers.
“Our company thinks this is a really bad idea, not so much for us and our employees but for the state of Nevada,” Paul Caudill told the Northern Nevada Development Authority luncheon in Minden.
The Energy Choice Initiative, Question 3 on the November ballot, is up for a vote for the second time. If voters approve it again, it would put deregulation of electric utilities into the Nevada Constitution.
In his talk May 23, Caudill said he wasn’t talking about protecting NV Energy, which serves 90 percent of electric customers in Nevada.
“Our company will be fine,” he said.
He said his concern is the 1.2 million residential customers and “the jury is out on whether residential customers as a group will benefit.”
“Major customers commercial and industrial will likely have the opportunity to save some money,” he said. “Residential customers kind of take the brunt of this transition.”
In addition to the potential for higher residential rates, Caudill said the Public Utilities Commission report on the Energy Choice Initiative identifies $3.5-$4 billion in costs to accomplish the transition to an open and competitive market.
To cover those transition costs, he said the state of Nevada could stand behind a bond issue that all customers would pay for. That PUCN report, he said, estimated the average residential customer would pay $20-$27 a month more on their electric bill for the 10-year life of the bonds.
He said it could also have a dramatic impact on those 30,000 customers with rooftop solar systems.
The state of Texas, which deregulated, he said, doesn’t require energy providers to provide net metering. Nevada’s law mandating NV Energy provide net metering would be superseded by the constitutional amendment and customers with rooftop solar have agreements with solar providers to pay off the systems with what NV Energy pays them for their solar generation.
If NV Energy no longer has the ability to provide net metering through its monthly bills, “the state is going to have to figure a way to satisfy that obligation or they’re going to have some pretty unhappy people.”
“Right now there’s no clear answer to net metering,” Caudill said, later telling the audience of more than 60 people: “I think at this stage of the game, there’s not another, more important decision the state of Nevada will make in the next 20-30 years.”
If approved, he said the proposed amendment would require NV Energy to divest itself of all its generating facilities — 66 of them statewide. He said the utility would no longer be allowed to generate and sell retail power.
But, at present, he said NV Energy has the generating power to cover its electric needs even during peak hours in August.
Construction of the project is estimated at $47 million and is scheduled to be complete in the first quarter of 2020, according to a news release.