In vetoing this past week a bill that would have increased the required percentage of electricity in Nevada coming from renewable sources — such as solar, wind and geothermal — from the current 25 percent by 2025 to 40 percent by 2030, Gov. Brian Sandoval did the right thing but apparently for the wrong reason.
The governor felt obliged in his veto message to pay lip service to the concept of increasing the renewable portfolio standard (RPS), noting the proposal is very popular and has received positive news coverage in print and on television and online social media.
But he said that “although the increase in the RPS proposed at this time in AB206 is one that I would otherwise support, the consequences of approving this bill must be considered through the lens of recent changes to Nevada energy policy and those likely to be adopted in the near future. These changes can only be characterized as massive shifts in energy policy that have already dramatically altered the energy landscape in Nevada. They are occurring in real time, with energy policy evolving in real time.”
Sandoval said the reason he vetoed Assembly Bill 206 was that in 2016 72 percent of Nevada voters approved a change to the state Constitution that would end the electricity near monopoly in which 90 percent of power in the state is sold by one company, NV Energy. If voters again approve the Energy Choice Initiative in 2018, the energy market would be open to competition. That would also impact the other 10 percent.
If the initiative passes, the power companies would have to sell assets and that would result in costs that would have to be borne by the ratepayers, “resulting in higher power bills for most Nevadans,” the governor observed.
Assemblyman Chris Brooks, the Las Vegas Democrat who sponsored AB206 and has worked for years in the solar power business, told the press, “AB206 would have made Nevada not just a national leader, but a world leader, in the next generation of clean and renewable energy sources that would have diversified our economy and created good-paying, high-quality jobs.”
Actually an analysis of the current RPS — 25 percent by 2025 — by the Beacon Hill Institute at Suffolk University a couple of years ago found the costs far outweigh any supposed benefit.
The study estimated that in 2025 the current RPS would lower Nevada employment by anywhere from 600 to 3,000 jobs, reduce disposable income by a range of $72 million and $373 million and increase the average household electricity bill by $70 per year and commercial businesses by an expected $400 per year and industrial businesses by an expected $26,220 per year.
You don’t have to predict. Look no further than neighboring California, which has an RPS of 50 percent by 2030. It already has power bills 50 percent higher than the national average.
And for what? According to a Heritage Foundation report, if the entire industrialized world stopped burning fossil fuels and cut carbon emissions to zero, global warming would be reduced by four-tenths of a degree Celsius by 2100.
So, yes, the Energy Choice Initiative and its potential drastic shake up of the energy market added a degree of risk to ratepayers, but ratepayers already would have been on the hook had AB206 become law, despite what the governor and the mostly Democratic lawmakers who passed the bill claim.
In fact, we call for the 2019 Legislature to repeal the RPS entirely and let electricity consumers purchase power in a competitive marketplace. — TM