Newspaper column: PUC tilts at power choice initiative

The Nevada Public Utilities Commission, which is tasked with regulating the state’s monopoly utilities, has put out a 109-page report detailing a litany of things that could go wrong if voters again approve at the ballot box in November a constitutional amendment creating a free market for electricity.

In 2016 voters approved the Energy Choice Initiative by an overwhelming 72.4 percent to 27.6 percent. Because the measure would amend the state Constitution it is back on the ballot this fall for final voter approval, but this time around a coalition headed by the state’s largest power monopoly, NV Energy, has vowed to spend $30 million to defeat it.

The PUC report reads like an in-kind contribution to that effort.

A foreword signed by PUC Chairman Joe Reynolds declares that, while the concept of open markets is quintessentially American, “ensuring a non-stop supply of electricity to every home, business, and governmental entity in Nevada every second of every day of the year, regardless of the weather or economy, makes it unique from other goods and services. Electricity is a basic necessity of modern life. Like air. Like water. Like food.”

The Nevada Independent pix by Jeff Scheid

Thank goodness for those government regulated monopoly grocery stores.

While Reynolds says the report neither supports or opposes the initiative, the bulk of its findings appear to find fault with the proposal.

The initiative would require the Legislature to pass a law providing an open, competitive retail electric energy market by July 1, 2023. The law must include provisions to reduce customer costs, protect against service disconnections and unfair practices, and prohibit the granting of monopolies for power generation, but could leave in place regulation of transmission and distribution.

One of the chief arguments for the measure is that competition would drive down cost.

But the PUC report claims the proposal is likely to increase monthly electric bills in the first decade of implementation. The bulk of this cost is attributed to the supposition that NV Energy will be forced to divest its generation assets, though there is no language in the initiative even suggesting any such requirement.

The report argues that this presumed divestiture would cost Southern Nevada residential power customers $24.91 a month and Northern Nevada residential customers $6.52, because NV Energy might have to sell off its power plants at a loss. A presumption compounding a presumption.

At one point the report seemingly declares that the system isn’t broken, stating, “Our residential rates are on average, and our commercial and industrial rates are lower than average.”

In its conclusion the report feigns solicitude for the poor residential ratepayer and warns that residential customers might suffer the most if the initiative passes.

“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,” the report states. “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 users.”

This is the same PUC that currently sets those residential, commercial and industrial rates.

According to the U.S. Energy Information Administration, which is cited as the source for that earlier mention of low rates on average, the residential rate set by the PUC were the highest among the eight Mountain states in January 2018, while the commercial rate was the third lowest and the industrial rate was the second lowest in the region.

While residents paid 12.36 cents per kilowatt-hour, commercial customers paid 8.04 cents and industrial users paid only 5.28 cents. Thirty-one states have lower residential power rates than Nevada, according to the EIA. Only four states have lower industrial power rates. Only three states have lower commercial rates. (The EIA site now has February rates.)

Aren’t you glad your state regulators are looking out for you?

The report does point out a potential legal conundrum. While the initiative creates a “right to sell trade or otherwise dispose of electricity,” it also says lawmakers retain the power to establish “policies on renewable energy, energy efficiency and environmental protection.”

A right would appear to trump a policy. The report asks whether a mining company might have the right to buy power from a coal-fired plant, despite a state law closing all such plants.

In a section on the impact on jobs, the report snidely concludes, “Lots of Nevada attorneys may also gain new work from the Energy Choice Initiative.”

A version of this column appeared this week in many of the Battle Born Media newspapers — The Ely Times, the Mesquite Local News, the Mineral County Independent-News, the Eureka Sentinel and the Lincoln County Record — and the Elko Daily Free Press.

24 comments on “Newspaper column: PUC tilts at power choice initiative

  1. Curious. Bill Wilson says:

    Why is Nevada Power allowed to spend 30 million dollars of ratepayers money to preserve and protect their profits? Do these millions come out of profits or from ratepayers? Why is NV Energy allowed to contribute to every political race in Nevada? Where does that money come from? Is it true if a politician of poses in the powers objectives they no longer get a contribution from the power company?

  2. I doubt the PUC will slap their hands.

  3. Rincon says:

    Most electric utilities are private companies, although heavily regulated. Private companies are allowed to lobby, contribute, and spread propaganda as they see fit. I cannot imagine that Nevada Power went to the legislature and said, “How about a few bucks extra?”, but please let me know if you find that they did. Why is it just fine for private companies to spend limitless amounts on campaign contributions with their unspoken quid quo pro, but utilities shouldn’t be allowed freedom of speech?

  4. Bill says:

    Most everyone would like to see lower electricity rates but most complaints that I hear are about service and interruption of service.

    You can produce all of the electricity in the world but you have to deliver it to the homes and businesses. That requires transmission lines and facilities.

    So, the question to me is what is the proposal for maintaining the electrical grid? Who pays for expanding it and maintaining it?

    And, Thomas, IMHO, in the section on the impact on jobs, it may be “snide” to say that “Lots of Nevada attorneys may also gain new work…” but it is also probably an accurate statement. It would be a more complete statement if it also referred to lobbyists as well.

  5. Yes, probably accurate. And the lobbyists, too.

  6. Steve says:

    Bill, the grid remains a monopoly in most places. Some places break it up into regional monopolies, but the grid is always a one company operation. Bills come with grid access and maintenance charges and electricity consumption from your chosen generation company.
    You would get one bill like you do now but it would reflect the companies associated with grid ownership and generation instead of all one company like we have now.

    NVE stated they would exit the generation market completely. This would mean we would all have to choose a generation company right off the bat. That gets problematic with all of the scammers and low/ upfront pricing schemes very similar to cable now. Sell you the stuff for a low (first year) price, hook you into a contract that requires you pay full “regular” price for the remaining years…sometimes as much as three. I have relatives and friends in Massachusetts who tell me it was cheaper to remain with their original company (NVE will make that not an option) and others who tell me they didn’t make any changes and didn’t see any real losses or gains from being on an energy choice system.

    If it happens it will mean reading all the fine print in contracts from electricity providers. A time consuming process coupled with very dry reading and it will come with a deadline.

  7. Bill says:

    Thanks Steve for the amplification. Monopolies may not necessarily be a bad thing in some instances.

  8. Rincon says:

    “That gets problematic with all of the scammers and low/ upfront pricing schemes very similar to cable now.” I thought competition was supposed to prevent that. If we don’t advocate unfettered marketing of electricity, why do we advocate unfettered marketing of health care? At least with electricity, the consumer has time to compare and deliberate – quite unlike the case in health care when the patient may be flat on their back.

  9. Steve says:

    CABLE has competition? HA,ha,ha,ha,ha! No, no stop! That is totally funny!
    AND, this whole discussion is about opening the market to GENERATION….after all, just how many wires do you want in your neighborhood, Rincon?

  10. Bill says:

    Rincon, perhaps you can find your answer about health care in the case of Alfie Evans or Charley Gard. That is what can happen in health care when there are no alternatives except a single government choice.

  11. Steve says:

    Alfie Evans

    Another REAL LIFE example of government, socialised, healthcare.

  12. Rincon says:

    Maybe in Bumblefarkel Nevada, cable has no competition, but here in Illinois, they do. We haven’t paid a cable bill for more than 5 years, getting our television from Netflix, Amazon, and Youtube. Before that, we received our television via satellite. Oh, I almost forgot out trusty antenna, which receives more than 50 over the air stations.

  13. Rincon says:

    I believe a caricature of Charlie’s story was used by the Conservative establishment to create doubt and sow confusion regarding socialized health care, so the real story follows. I have to comment also though, how pitifully inadequate an anecdote or two are compared to the tsunami of information showing conclusively that our health care system is both less effective and way more expensive than that of any other advanced nation. You’re strangely silent about the hundreds of anecdotes available regarding people in the U.S. that have received woefully inadequate health care. Anecdotes are the cheapest and least rational form of persuasion.

    I suspect Alfie’s case may have a similar dynamic, but it’s best to only argue about one at a time.

    Re: Charlie Gard:
    “A neurologist in New York, Michio Hirano, who was working on an experimental treatment based on nucleoside supplementation with human MDDS patients was contacted. He and GOSH agreed to proceed with the treatment, to be conducted at GOSH and paid for by the NHS. Hirano was invited to come to the hospital to examine Charlie but did not visit at that time. In January, after Charlie had seizures that caused brain damage, GOSH formed the view that further treatment was futile and might prolong suffering.They began discussions with the parents about ending life support and providing palliative care.

    Charlie’s parents still wanted to try the experimental treatment and raised funds for a transfer to a hospital in New York. In February 2017, GOSH asked the High Court to override the parents’ decision, questioning the potential of nucleoside therapy to treat Charlie’s condition. The British courts supported GOSH’s position. The parents appealed the case to the Court of Appeal, the Supreme Court and the European Court of Human Rights. The decision of the court at first instance was upheld at each appeal. In July 2017, after receiving a letter signed by several international practitioners defending the potential of the treatment and claiming to provide new evidence, GOSH applied to the High Court for a new hearing.[5]:9 Dr Hirano visited Charlie at GOSH during the second hearing of the case at the request of the judge. After examining scans of Charlie’s muscles, Hirano determined it was too late for the treatment to help Charlie and the parents agreed to the withdrawal of life support. GOSH refuted Hirano’s statement that it was too late for the treatment. GOSH maintained its position throughout that Charlie’s condition had deteriorated by January to the extent that the proposed experimental treatment was futile.” https://en.wikipedia.org/wiki/Charlie_Gard_case

  14. Steve says:

    And rincon continues the effort of ignoring reality in favor of blind argument.

    Sad.

    Though I must accept Rincon’s admission to knowing nothing about reality outside the echo chamber Rincon loves to sound here.

  15. Bill says:

    Parents seeking medical help for their children and being opposed with the might of the State is more than just an “anecdote” to many of us here in Bumblefarkel, Nevada. Are the medics acting as death squads? Just a question, Rincon.

    Some of us slower witted persons are having a hard time understanding whatever happened to the humanity of those medical personnel who brought the might of the State to bear against the parents, because they knew what was best.

  16. Steve says:

    Yeah bill, cuz wese just hiks from a backard state with no idea how to live in Rincon’s utopia!

    Sadly, we see and accept reality for what it is. Oh woe is us!

  17. Steve says:

    Oh, and:

    Bumblefarkel

    Totally rocks!

  18. Rincon says:

    If we don’t allow a parent to abuse their child by inflicting pain, then should we allow parents to do the same by prolonging a state of suffering? First, let’s make sure you read the article carefully:

    1) Famous neurologist was invited to come to hospital to examine Charlie.
    2) Charlie’s condition deteriorated greatly from a state of little hope before famous neurologist examined him. So what is worse that little hope? I’ll let you guess.
    3) Parents requested that Charlie be transferred for experimental treatment.
    4) Hospital asked the courts to block this experimentation.
    5) Every court all the way up to the Supreme Court agreed that experimentation on Charlie would prolong his suffering and so, denied permission to experiment on him. From the Supreme Court’s statement: “it was not certain whether Charlie is suffering pain but it is likely
    that he is suffering it and at more than a low level (paras 22, 113, 114);
    (c) the clinician in the US who was offering the treatment favoured by
    the parents conceded that the chances of its securing meaningful brain
    recovery were vanishingly small (para 105); and
    (d) the proposed treatment would not only be futile but might well cause
    pain, suffering and distress to Charlie (para 49).” https://www.supremecourt.uk/cases/docs/charlie-gard-190617.pdf

    Do we allow 7th Day Adventists to deny blood transfusions to their children? We do not. Do we allow parents to physically abuse their children in order to enforce the parents’ brand of discipline? No. Do we allow parents to film pornographic material using their children? Do we allow parents to sell their children? We do not. And so on.

    But somehow, Conservatives believe parents should have the right to prolong their child’s likely pain with a near zero chance of providing any of life’s experiences other than the ability to breathe. Would any of you ask to be kept alive and suffering in Charlie’s place? Hard to believe any of you would.

    What amazes me is that anyone allowing this for their dog would be roundly condemned. Every week, people in my office take comfort by preventing their pets’ continuing suffering with humane euthanasia. Not for humans though. Conservatives see to it that we humans are forced to suffer until our bodies can take it no longer. BTW, the magical medicines that Conservatives envision for hospice don’t exist. The phrase intractable pain exists for a very good reason. Even if pain medicine was magically effective, do any of you seriously believe that there is medicine that takes away the suffering of someone with chronic obstructive pulmonary disease? No, these poor people suffocate to death over a period of hours to days, but by God, Conservatives like to see them die in agony with dignity. An oxymoron if I ever heard one.

    Let’s see here…Conservatives believe that parents should be allowed to subject their babies to prolonged suffering, but adults shouldn’t be allowed to avoid inevitable suffering while on their death bed. So in Conservative paradise, parents can decide for their child, but adults can’t make the decision for themselves. The only commonality is that the Conservative position maximizes suffering. You guys aren’t really that sick, are you?

  19. Steve says:

    Conservatives =all horror bad ugly
    Liberals = all perfect beauty rainbow

    Typical.

    Rant much?

  20. Rincon says:

    The brilliance of your reply is a sight to behold and is almost a tiny bit persuasive. Nah, not really.

  21. Steve says:

    And yet, to the proverbial “T” it spells out your comments in a nicely wrapped nutshell.

  22. […] 2016 voters approved the Energy Choice Initiative by an overwhelming 72.4 percent to 27.6 percent. Because the measure […]

  23. […] 3 on the 2016 General Election ballot — the Energy Choice Initiative (ECI) — passed by an overwhelming 72.4 percent to 27.6 percent. Because the measure would amend the state […]

  24. […] billion that would have to be paid by existing customers. The Public Utilities Commission of Nevada estimates those stranded costs could cause electricity rates to rise $24.91 a month in Southern Nevada and $6.52 Northern Nevada […]

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out /  Change )

Google+ photo

You are commenting using your Google+ account. Log Out /  Change )

Twitter picture

You are commenting using your Twitter account. Log Out /  Change )

Facebook photo

You are commenting using your Facebook account. Log Out /  Change )

Connecting to %s