Nevada Bill Aims to Lower Energy Costs for Consumers

LAS VEGAS, Nevada — State energy regulators in Nevada may soon be required to investigate how rising fuel costs impact power bills for consumers, potentially leading to new protections for ratepayers. This follows alarming reports from local residents like Andi Kaufman and Carol Polk, whose NV Energy bills spiked dramatically last year. Kaufman’s costs soared from $91 to $245, while Polk saw a similar increase despite efforts to reduce her energy consumption.

NV Energy, the state’s primary electricity provider, directly passes fuel costs through to its customers, which means they shoulder the burden of fluctuating fuel prices. The recent surge in electricity costs has been attributed to various factors, including the pandemic’s impact and unprecedented winter storms in Texas. Responding to these challenges, Assemblywoman Tracy Brown-May (D-Las Vegas) has introduced a bill designed to mitigate this volatility.

Introduced as Assembly Bill 452, the bill mandates state energy regulators to explore how NV Energy applies fuel and purchased power costs to consumer bills. It may also lead to the implementation of a fuel cost sharing mechanism. This arrangement would allow the utility to bear some of the costs associated with fuel price increases, preventing customers from absorbing the entirety of the financial impact.

“Fuel cost sharing can incentivize utilities to invest in renewable energy sources,” Brown-May said during a recent committee hearing. Rebecca Wagner, a former state energy regulator who contributed to the bill’s drafting, echoed her sentiments, stating that it poses no harm to the utility while providing an upside for consumers.

The bill stipulates that any fuel cost sharing should strike a balance—high enough to encourage NV Energy to control costs, yet low enough to protect the utility from undue risk. Currently in Nevada, every dollar spent by NV Energy on fuel directly impacts customers, with fuel comprising a significant portion of their electricity expenses.

Critics within NV Energy argue that the current system functions adequately. Janet Wells, NV Energy’s vice president of regulatory, stated, “The idea that customers are unprotected is simply not true.” Wells expressed concern that the proposed bill may create more problems than it solves, emphasizing that state regulators already have the authority to monitor utility spending.

The bill has gained support from groups advocating for consumer protections, highlighting provisions aimed at addressing issues of overcharging by NV Energy. The legislation looks to close loopholes that allow the utility to only partially refund customers who have been incorrectly charged. Additionally, it proposes extending timelines for state regulators to evaluate the utility’s filings.

Ernest Figueroa, Nevada’s State Consumer Advocate, supports the bill, asserting that the detailed examination of utility practices is crucial. As rates continue to rise, the need to protect consumers becomes increasingly pertinent. Proponents of the bill argue that it not only serves to protect customers from unexpected costs but also encourages NV Energy to be more transparent about its operational expenditures.

The proposed legislation passed out of committee in mid-April and is poised for further discussion among lawmakers. If enacted, it could lead to significant changes in how power costs are assessed and managed in Nevada, with the aim of reducing the financial strain on consumers. Ratepayers, especially those on fixed incomes, are hopeful that positive changes are on the horizon as state regulators prepare to explore these crucial issues.