CARSON CITY, Nev. (AP) — SolarCity said Wednesday it will stop selling and installing rooftop solar panels in Nevada after energy regulators decided to change the way solar customers are charged for utility service.
SolarCity Corp. issued a statement saying the Nevada Public Utilities Commission "effectively shut down" the rooftop solar industry with Tuesday's decision, which is expected to raise rates over a five-year period for so-called net metering customers. That includes about 17,000 Nevada customers with solar panels who sell excess energy from their solar systems to NV Energy.
"The people of Nevada have consistently chosen solar, but yesterday their state government decided to end customer choice, damage the state's economy, and jeopardize thousands of jobs," said Lyndon Rive, CEO of the California-based company. "The PUC has protected NV Energy's monopoly, and everyone else will lose. We have no alternative but to cease Nevada sales and installations, but we will fight this flawed decision on behalf of our Nevada customers and employees."
The three-member commission adopted a policy Tuesday that will reduce by 75 percent the amount NV Energy pays customers for excess power their solar panels produce. It will also change the flat base service rate for solar customers to an amount to be determined in the next few days. The new rates would phase in over five years, starting Jan. 1.
The commission said the change means rooftop solar customers, who still use NV Energy transmission lines and tap into the utility's power, will pay more of the costs that are now shifted to non-solar customers. The change also reflects the declining price of solar-generated power and phases out subsidies that have been in place since 1997.
Solar companies are unhappy that the new rate structure applies to customers who bought solar panels in years past, not just new ones signing on.
"The Nevada government encouraged these people to go solar, and now the government is putting them at great financial risk," Rive said in a statement.
The PUC staff has said customers generally understand that utility rates are subject to change, and the state never promised unchanging prices, even if solar companies did during the sales process.
SolarCity's business model involves the company buying and maintaining solar panels, and customers leasing them, with the lease fee offset by the cost savings from a lower energy bill. Company Vice President Jonathan Bass said SolarCity had more than 2,000 employees stationed at several offices in Nevada, and several hundred Nevada-based workers dealing directly with local sales and installation could be affected by the decision.
The PUC's move caps nearly a year of high-profile debate about the future of rooftop solar policies in Nevada. State lawmakers deliberated this spring about a cap on the number of customers who can participate in net metering before voting almost unanimously to leave detailed solar policy-setting to the regulators at the PUC.
Solar companies have faulted Sandoval for not intervening in the issue since, and they filed a public records lawsuit in an effort to get some of his text messages, which they say might show he's cozy with NV Energy lobbyists.
Sandoval said the solar companies were using "bullying tactics" in threatening mass layoffs and improperly pressuring his office to influence the PUC's "independent decision making process."
"Traditional energy customers are subsidizing rooftop solar customers and the state must determine the best way to help develop an emerging industry while ensuring the families who consume traditional energy sources are not paying more just to finance the rooftop solar marketplace," he said in a statement Wednesday. "The solar industry should respect the legal process and I ask the industry to approach the PUC's decisions thoughtfully and reasonably."