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NV Energy withdraws, plans to re-file program offering special lower rates for large customers

Riley Snyder
Riley Snyder
Energy
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NV Energy has withdrawn and plans to rework its application to create a new, renewably powered special rate designed to keep large power customers in the company’s fold.

In a filing last week, NV Energy attorneys withdrew the utility’s pending application for its Optional Pricing Program Rate (OPPR), stopping regulatory approval on an alternative pricing mechanism proposed by the utility last year as a way to keep multiple large businesses from filing or continuing with applications to leave the utility.

In a statement, NV Energy spokeswoman Andrea Smith said the company was still working on the pricing program and planned to eventually refile a similar application with the Public Utilities Commission.

“We understand we still have some work to do with various stakeholders to reach a balanced outcome on this program and have withdrawn our original filing in order to take the time to work toward that balanced outcome,” she said in an email. “We fully intend to resubmit the program in the very near future so we can offer this important product to our customers.”

Although the company had already opened up an application window for the program (fulfilled in 20 seconds of opening in Southern Nevada), the program was never approved by the Public Utilities Commission, and commission staff and the Bureau of Consumer Protection had raised concerns that the program would end up costing normal residential ratepayers and benefited an arbitrarily-picked group of customers.

NV Energy filed a motion to delay processing of the OPPR application in late May, before withdrawing the application entirely on June 14.

As proposed, the OPPR rate would have been available only to utility customers eligible to leave its service through the 704B process, used by a handful of major casinos and other large-scale energy users to depart the utility and buy power from other third party providers in return for a usually substantial “exit fee” to ensure new costs aren’t fostered onto other utility customers.

The rate would have been composed of certain non-bypassable charges (such as gas transmission) but would have replaced the standard electric rate with a flat charge based on the utility’s six new major solar power plants adding 1,001 megawatts of solar electricity to the company’s fuel mix.

Although the projected price savings from the program were largely kept private, the Nevada System of Higher Education (which is eligible for the program) estimated that it could save roughly $381,000 a year from enrolling in the program statewide.

But the pricing program has been criticized by commission staff and the Bureau of Consumer Protection, which called it “inconsistent with the very premise of planning and operating the utility as a system for all ratepayers.” The agency estimated that the initial version of the program would have seen roughly 48 percent of the benefits from the new renewable energy contracts — or roughly $65 million — go to OPPR customers, who only represent roughly 5 percent of total electric sales from the utility.

Since initially proposing the OPPR program last year, NV Energy has announced arrangements with some of its largest customers who had flirted with leaving utility service but ultimately decided to stay, including Station Casinos, the Cosmopolitan, Las Vegas Sands, the Las Vegas Convention and Visitors Authority, Grand Sierra Resort, the Atlantis, Golden Gaming and South Point.

NV Energy also supported a bill in the 2019 Legislature that added multiple barriers and new requirements for businesses seeking to leave NV Energy, but allowed the roughly dozen or so businesses that have pending applications before the commission to continue under the old system. That measure was approved nearly unanimously and signed into law by Gov. Steve Sisolak.

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