Monopoly utilities are often seen as the chief obstacles to renewable energy. And there is certainly evidence of this, as utility monopolies in the Deep South and elsewhere have been among the last to deploy large volumes of renewables, and the most implacable foes of distributed generation.
As such, deregulation – the legal breaking up of utility monopolies to create a competitive retail electricity market and/or to separate generation and retail sale of power – has been broadly hailed as an aid not only to consumers, but renewable energy as well. Germany’s competitive electricity market has supported renewable energy deployment, and the deregulation of Texas’ electricity market in 2002 is widely seen as an important factor enabling the state to become the wind capital of the United States.
This makes it all the more curious that four environmental groups have now come out against a measure that would deregulate Nevada’s retail electricity market, an effort backed by Tesla, SolarCity and a number of large energy consumers who have signed contracts with renewable energy projects.
Question 3 would change the Nevada constitution to enshrine the right of Nevadans to have a choice as to who they buy power from. It is supported by Governor Brian Sandoval (R) and U.S. Senator Harry Reid (D), as well as MGM Resorts, Switch and Walmart, all of whom have deployed and/or contracted with large amounts of renewable energy. In fact, MGM Resorts is one among a number of casino holders that have paid large sums of money to be free from NV Energy’s monopoly and to contract power from renewable energy installations directly.
And yet Sierra Club, Natural Resources Defense Council (NRDC), Western Resource Advocates and Southwest Energy Efficiency Project all came out against Question 3. And while the first three of these organizations are more known traditionally for being environmental groups, all have played a substantial role in clean energy advocacy in the past decade.
In a statement released last Thursday, the organizations express the concern that Question 3 could “disrupt the state’s progress towards a clean energy future.” Specifically, the organizations argue that a deregulated market could interrupt NV Energy’s commitment to procure 1 GW of renewable energy, and could “introduce uncertainty into the state’s recovering rooftop solar industry”.
“Question 3 has been sold to voters as a way to get more renewable energy online in Nevada, but it will actually make it more difficult,” declares Dylan Sullivan, senior scientist at NRDC. “There will be years of market uncertainty as the legislature figures out how to implement complex restructuring, and even after that, electricity retailers have shown a reluctance to sign the long-term contracts it takes to get new renewables built.”
It is notable that this position is a recent declaration, which raises the question of whether or not these organizations would have taken this position were it not for the plans announced by NV Energy in late May to procure 1 GW of solar and build 100 MW of batteries.
This could have been a move to stave off deregulation, given that the utility has been under continual pressure from large electricity consumers such as data centers and casinos to allow them to contract with more renewable energy, and the heat that it has taken from the temporary dismantling of net metering, which has since been re-instated.
And from pv magazine’s perspective, if the battle between NV Energy keeping its monopoly and the creation of a deregulated electricity market means more deployment of solar, we all win.
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