Nevada PUC Adopts Final Report Saying Electric Choice Will Likely Lead To Increase In Monthly Bills
The Nevada PUC adopted a final report on the electric choice ballot initiative, which finds that, "The Energy Choice Initiative is reasonably likely to increase the average monthly electric bills of Nevadans, at least the in the short term, i.e., the first 10 years. These cost increases will potentially diminish over the years as Nevada's new open-market paradigm becomes established, Nevada's economy and population grows, and the transition costs are paid off."
The final report states, "The total cost estimates discussed in this Report range from over a hundred million dollars in new costs to several billion dollars in remaining costs that will reasonably likely be added to Nevadan's monthly electric bills in an open and competitive market. These costs would be in addition to generation, distribution, and transmission costs, as well as any legislatively-imposed energy policy costs that the Nevada State Legislature may determine to impose. It is unreasonable for anyone to suggest that these costs will be nothing or will be immediately offset by new market electricity rates. Indeed, no reasonable basis exists to believe they will be, at least not in the short term, i.e., the first 10 years."
"Based on the above-cited information and reasonable presumptions, the Energy Choice Initiative will likely increase the average monthly bills across Nevada customer classes," the report states
"The Energy Choice Initiative will cause Nevada to abolish its control over a key component of electric rates, and change the way Nevada has generated, bought, and sold electricity for over 100 years. No state has ever done it this way before, and it will likely create 'winners and losers.' If history and experience are any type of guide, commercial and industrial customers, will fare far better, at least initially, than the average Nevada residential family through this proposed change. Large commercial customers who currently cannot depart bundled electricity service pursuant to NRS Chapter 704B may financially benefit the most, as they cannot currently access a competitive open marketplace that may offer benefits to high-volume electricity users. Monthly bills are reasonably likely to increase in the short term. Immediate Nevada-specific benefits to single-family residential customers, and low-income customers, remain 'elusive' and difficult to quantify," the final report states
The final report also adopts additional findings with respect to POLR and default service and wholesale market issues that were cited in a draft report, without substantive modification. See ECM's story for more details on such draft findings which remain in the final report