SolarCity Corp Gets a Boost Thanks to NV Energy
In a turn of events, NV Energy sides with SolarCity on net-metering rulesSolarCity’s fate has taken yet another turn. NV Energy which was earlier accused of being the only beneficiary of new net-metering rules, has announced in a press release on January 25, that it would propose allowing the old rate structure for existing customers. NV Energy president and CEO Paul Caudill said: “This grandfathering proposal is being offered in recognition of NV Energy’s desire to treat all customers, including those who had previously made a decision to install rooftop solar, fairly.”
Nevada’s Public Utilities Commission’s (PUC) decision to amend its policies for the solar industry flared controversy. The PUC passed an order in December of last year, to increase service charges for solar panel users, for the use of the power grid, and to reduce the payments they receive for the export of power to the grid.
The decision was criticized by solar companies, which accused NV Energy of being the only beneficiary of the policy. SolarCity (NASDAQ:SCTY), the largest renewable energy company in the US, along with SunRun, decided to cease sales and installment operations in the state which led to more than 600 job losses in the state.SolarCity argued that the decision is unjust; and even implied that Governor Sandoval had firstly, encouraged people to go solar and then charged them for doing so. However, Lyndon Rive- CEO of SolarCity remained optimistic that once the Commission understands the real impact, they would revert back their decision.
Stoppage of operations and the resultant job cuts at solar companies, triggered concerns within the department. Governor Sandoval, referred to these events as “Bullying the regulators”, that fueled a war of words between the CEO and the Governor. Afterwards, Patricia Farley- a Republican Senator for the state and lead author of the bill said she was “concerned” over the reaction from SolarCity, in a phone interview to Bloomberg. The lead author expressed her belief over the PUC as she said that “I have to assume that the PUC would do the right thing”. However, she hinted that that the people who had relied on old rates should be offered a “remedy”.
Things did not cool down even then as people of Nevada gathered around the PUC’s headquarters in Las Vegas to protest the decision while regulators convened for the first time to discuss the impact of higher fees. This was followed by a class-action lawsuit against NV Energy by two solar customers who conetnd that it committed “consumer fraud” with them and others. Now finally there appears to be sunlight at the end of the tunnel as Nevada’s PUC has approved the state’s Consumer Protection Bureau’s request to reconsider its earlier decision.
NV Energy has stated that it would submit a proposal on February 1, to the Commission to recommend that existing solar customers should be allowed to remain under the old net-metering rules over a transition period of 20 years. The proposal by NV Energy has boosted investors’ confidence in SolarCity stock, as it has increased by around 13% since then.