Today’s lede: Tesla withdraws support for Question 3, Nevada’s energy choice ballot initiative. Tesla, which located its huge battery-making “Gigafactory” in Nevada, was an early proponent of a controversial ballot initiative that would end monopoly regulation in the state and allow consumers to choose among competing electricity suppliers. Now a company official has confirmed that Tesla “has changed its position to neutral,” Riley Snyder reports in the Nevada Independent.
“While we believe in open and competitive markets, Question 3 presents a number of uncertain impacts to our energy customers and the renewable energy industry in Nevada,” the unnamed Tesla official said in an email to Snyder. “As a result, we have decided not to take a position on Question 3.”
The ballot question passed with 72 percent of voters’ support in the 2016 election. In order to effectively change the state’s constitution and end monopoly price regulation, the measure must pass a second time this November. NV Energy, which stayed on the sidelines in 2016, has come out guns blazing against Question 3 this time around, pledging to spend as much as $30 million to defeat it. The result has been an unprecedented ad blitz by the utility-funded no campaign and the yes effort funded largely by casino firm Las Vegas Sands and the data center giant Switch.
A reading of the tea leaves indicates the no campaign is winning. Polls show minority support for the measure, and many high-profile politicians who supported Question 3 two years ago now profess to be neutral or oppose the measure.
“Unfortunately, NV Energy and their out of state corporate owners are spending millions spreading false information about energy choice,” Nevadans for Affordable, Clean Energy Choices spokesman Bradley Mayer said in an email to Snyder. “We understand that companies take positions on what is in their best business interest but we agree with Elon Musk when he said, ‘Monopolies are true enemy of people,’ and, ‘What really matters is avoiding monopolies that restrict people’s freedom.’”
Snyder reports that one month after advocates announced the Energy Choice Initiative in 2016, Tesla CEO Elon Musk said in a statement that “solar energy is the cheapest energy today in the state of Nevada and ‘Energy Choice’ will enable Tesla and all Nevadans to choose solar.”
Snyder quotes a spokeswoman for the group opposing the initiative acknowledging that they welcome Tesla’s withdrawal of support for the measure. “We appreciate that Tesla has reconsidered their position on Question 3, particularly because of the risks and uncertainties that this flawed electricity deregulation proposal poses to tens of thousands of existing rooftop solar customers,” Coalition to Defeat Question 3 spokeswoman Tracy Skenandore said in an emailed statement. “Question 3 would also increase electric rates for all Nevadans and put our state’s promising clean energy future at risk.”
“Criticism from the solar industry has been blunted in the past two years, starting when regulators with the Public Utilities Commission agreed to ‘grandfather’ in existing net metering customers at prior, more favorable rates in 2016,” Snyder notes. “Lawmakers also approved a change to the state’s net metering law in 2017 that was widely applauded by the industry and has helped jumpstart new rooftop solar applications.”
Solar industry poll finds 90 percent of voters object to utilities blocking residential solar. Nearly nine in 10 voters polled in a survey sponsored by the Solar Energy Industries Association said electric utilities should not block residential solar. “Consumers hate the fact that utilities can control their choice of electricity,” SEIA spokesman Dan Whitten told Utility Dive.
Former FERC chairman Wellinghoff says Question 3 will lower power rates. “If Question 3 passes, electric rates will go down,” said Jon Wellinghoff, the former chairman of the Federal Energy Regulatory Commission, while filming Nevada Politics Today. “We’ve done a study, done by a nationally recognized utility expert, who’s indicated very clearly that there are substantial tax savings in accumulated differed income taxes and additional savings in over earnings from the company that would come back to Nevada ratepayers to lower their rates. So number one, we already have a pot of money that we see will in fact lower rates. In addition to that, if you look at what competition has been doing in other states, the actual experience for example in Texas, we know that rates will be lowered.”
Nevada city council approves resolution in opposition to Question 3. The Elko City Council approved a resolution in opposition to Ballot Question 3, The Energy Choice Initiation, citing concerns about potential impacts on rural communities. “I fully support this resolution,” Councilman Reece Keener said, “knowing its devastating impact on employees and vendors.” Keener professed to be a “free market person,” but said electricity is an industry that lends itself to a regulated monopoly. Councilman John Patrick Rice said he has watched deregulation impacts on rural communities, such as airline deregulation and telecommunication deregulations so he opposes the proposed amendment.
SEC brings court action after Elon Musk backs out of settlement. The Securities and Exchange Commission brought suit against Tesla’s Elon Musk accusing the rock star CEO of misleading investors with his now-infamous tweet saying he would take Tesla private at $420 a share, Bloomberg News and multiple other news outlets report. The SEC lawsuit seeks unspecified damages and Musk’s ouster as Tesla’s CEO. The SEC said Musk falsely claimed funding was secured for taking the company private, and the $420 per share price he proposed reflected the slang term for marijuana and was intended to “amuse” his girlfriend, the pop singer Grimes. The lawsuit targets Musk, not the company.
“Musk’s statements were false and misleading,” the SEC’s Stephanie Avakian said at a press conference in Washington, D.C., announcing the action. “They lacked any basis in fact.”
Tesla said in a statement that the company and its board “are fully confident in Elon, his integrity, and his leadership of the company, which has resulted in the most successful U.S. auto company in over a century.” Going forward, the company will remain focused “on the continued ramp of Model 3 production and delivering for our customers, shareholders and employees,” the statement said.
According to CNBC, Musk and the SEC were close to striking a “no-guilt” settlement that would have required Musk to step aside as Tesla’s chairman for two years and provided for the appointment of two new independent board directors. CNBC cited unnamed sources who said Musk refused the deal “because he felt that by settling he would not be truthful to himself, and he wouldn’t have been able to live with the idea that he agreed to accept a settlement and any blemish associated with that.”
“I have always taken action in the best interests of truth, transparency and investors,” Musk said in a statement. “Integrity is the most important value in my life and the facts will show I never compromised this in any way.”
News of the SEC action sent Tesla shares down 10 percent in pre-market trading. As of midday Friday, Tesla’s stock was trading down nearly 12 percent, deepening a months-long slide in value.
Merchant generators seek rehearing of 7th Circuit opinion upholding Illinois nuclear subsidies. The 2nd Circuit U.S. Court of Appeals ruling yesterday upholding zero-emissions credits subsidies for nuclear plants in New York was the second shoe to drop after the 7th Circuit previously ruled that the ZEC program in Illinois passed constitutional muster. The 2nd Circuit acknowledged that its ruling reflected findings of its sister U.S. appeals court. In issuing a statement responding to the most recent ruling, the head of the national trade group representing merchant generators said the group is seeking rehearing of the 7th Circuit decision as it mulls a response to the 2nd Circuit decision.
“EPSA will review the Second Circuit’s opinion and consider all its available legal options in due course,” said John Shelk, the Electric Power Supply Association’s president and CEO. “Regardless of any further legal steps EPSA may pursue, EPSA underscores that the 2nd Circuit and 7th Circuit courts each relied on representations from the U.S. Government that FERC can effectively address any adverse impacts that ZEC nuclear bailouts have on wholesale power markets. FERC must now do what it told the two courts of appeal it would do.”
EPSA’s Shelk noted that following that filing of the government’s brief that the two circuit courts relied on, “FERC found in a contested proceeding that adverse impacts from nuclear ZECs make existing PJM wholesale market rules unjust and unreasonable and thus unlawful under the Federal Power Act. FERC now has a legal duty to establish effective mitigation measures to keep ZEC bailouts and certain other out-of-market subsidies from producing the uncompetitive outcomes that prompted EPSA to pursue this litigation in the first place.”
Other electric industry news items of interest:
New Westar Energy rates in Kansas will benefit average customer but not solar power users. State officials have approved a settlement that will lower Westar Energy rates for most customers, but substantially raise costs for homeowners who provide some of their own power with solar panels. The Kansas Corporation Commission approved the settlement unanimously over objections from environmental groups who said it will strangle the budding home-solar industry in Kansas. The deal will save regular customers who get all their power from Westar an average of about $3.80 a month. But it will hit customers with home solar panels with a separate charge that could cost them an extra $27 to $36 a month, making it less worthwhile to invest in home generation. The extra charge for solar customers is called a “demand charge” and amounts to $9 per kilowatt for the solar customer’s highest usage for one hour each month in the summer, $3 in the winter when demand on the power system is lower. The settlement was crafted by Westar, commission staff, the Citizens’ Utility Ratepayer board and several commercial interests that joined the case.
Massachusetts clean energy advocates welcome SMART program order. Massachusetts solar advocates are pleased to see that the Massachusetts Department of Public Utilities has issued its order on the Solar Massachusetts Renewable Target, or SMART, program. This will not only enable the launch of the program, it will allow the Massachusetts’ solar industry to begin to invest in new projects and return much-needed solar jobs to the Commonwealth. We look forward to reviewing the order and working with the Department of Energy Resources, our members, and other stakeholders to work out final details and ensure the program is implemented successfully and to the greatest economic and environmental benefit of all Massachusetts residents and businesses. “While historically a national leader on solar, the Massachusetts solar industry has slowed over the past two years. The issuance of the SMART Order is the critical step needed for solar to ramp up in the Commonwealth again,” said Janet Gail Besser, NECEC Executive Vice President. “SMART is expected to save ratepayers 4.7 billion dollars and create thousands of jobs. This is certainly an exciting time for solar in Massachusetts.”
PSEG plans $4.1 Billion clean energy investment in N.J. New Jersey’s biggest utility says it can make money by getting its customers to use less of what it sells. Public Service Enterprise Group’s electric and gas distributor is proposing to spend $4.1 billion on programs designed to help New Jersey meet its clean energy goals, according to a statement Thursday. The initiatives would save customers an estimated $7.4 billion, the Newark-based company said. “This may be the only industry in America making a business case to sell you less of its product,” Chief Executive Officer Ralph Izzo said in an interview. “It’s counter-intuitive. If you think of our product not as electricity or gas, but you think of our product as infrastructure that allows you to make the optimal use of that electricity and gas, then we can grow our bottom line at the same time that we lower the customer’s bill and improve the environment.” Utilities across the country are moving to invest in grid upgrades and new technologies designed to help states achieve green-energy mandates put in place in part to combat climate change. It’s a rare opportunity for growth in an industry that’s been grappling with tepid demand as consumers use more-efficient appliances and produce their own power with solar panels. New Jersey recently passed a law that requires utilities to reduce customers’ annual electric and gas consumption by 2 percent and 0.75 percent, respectively.
Arizona electric co-ops look to short-circuit Prop 127 renewable energy mandate. Proposition 127, to be decided in the Nov. 6 general election, seeks to increase the state’s renewable portfolio standards, requiring that electric utilities acquire a minimum amount of electricity from renewable energy sources such as solar, wind, biomass, certain hydropower, geothermal and landfill gas energies. Current standards set by the Arizona Corporation Commission, which regulates utilities, requires 15 percent electricity from renewable energy sources by 2025. Proposition 127 would require electric utilities to step increase renewable energy sources to 50 percent by 2030. “Prop. 127 is a constitutional amendment, so if it goes in, it doesn’t come back out again,” said Grand Canyon Electric Cooperative Association spokesman John Wallace. “People should vote against this because this is a bad California mandate that’s coming into our state and it will result in significant price increases in your rates and you can see that in California already. They pay 47 percent higher rates than the rest of the country — We’re not against solar. It has to make sense and it has to be reliable and affordable.”
AEP Ohio customers to get $607 million after corporate tax savings settlement. Bill credits totaling $263 million will begin following the PUCO’s approval of the settlement and will continue for the next six years. The savings are in addition to $66 million in tax reductions that have been reflected in customer bills since January, officials said. An additional $278 million will be credited over the next 20 years through the Distribution Investment Rider, which allows AEP Ohio to continue making distribution system upgrades, building a smarter energy grid and providing more reliable service to its customers, according to AEP officials.
Liberty Utilities unveils renewable gas plan at New Hampshire landfill. Liberty Utilities wants to transform all the methane coming out of the North Country Environmental Services landfill in Bethlehem into enough gas to supply 6 percent of its New Hampshire customers’ energy needs, the utility announced Thursday. The project, which will be one of the first, and the largest, renewable natural gas projects in New England, would result in lower prices for customers, if the company is able to sell thermal renewable energy credits, or TRECs. In addition, said Susan Fleck, president of the company’s New Hampshire operations, “this project will reduce air emissions, develop a local renewable resource, lower fuel costs for our customers and create jobs and economic development in the North Country.” A third party, Rudarpa Inc., based in Utah, would collect the gas, remove impurities to turn it into the chemical equivalent of natural gas and then compress it into trucks, which would then deliver the product to Liberty’s facilities in Concord, Keene and perhaps Lebanon. Liberty would then be able to decompress the gas to serve the 92,000 homes and businesses in the 31 communities it serves.
$3 billion Hoover Dam project hopes to bring power plant into 21st century (video). Hoover Dam is one of the greatest engineering feats of the 20th century. Built during the Great Depression, it was the biggest public works project in the country. Now, as California and the West expand into renewable energy, there’s a $3 billion plan to bring the power plant into the 21st century. The project calls for a wind- and solar-powered pump station to be built 20 miles downstream. Water would be pumped back up to Lake Mead through underground pipes and sent back down during periods of higher demand. Los Angeles Mayor Eric Garcetti, a proponent of green energy, is also behind the plan. “You’re talking about a price tag of $3 billion. That’s a lot of money,” CBS News’s Jamie Yuccas said. “The cost of inaction is more,” Garcetti responded. “We’ve got drought and fires in the West. We’re going to be talking about 100 billions, trillions of dollars of costs if we don’t confront climate change now.”
Dutch offshore wind farms will still need taxpayer subsidies in 2022: audit office. It is not yet possible to build wind farms at sea without government subsidies, the Netherlands national audit office said on Thursday. The audit office was looking at claims by economic affairs minister Eric Wiebes, who said earlier this year he expected the first offshore Dutch wind farm without government money would come on stream in 2022. The audit office said energy generation at sea is becoming cheaper, and will have gone down 40% in price by 2023, compared with 2013. However, the audit office said, government subsidies will still be needed to pay for the link to the national grid. The government has set aside €4bn to help pay for offshore wind farms up to 2023 – money which is collected via domestic energy bills. This means, the audit office said, the wind farms which will be finished in 2022 will not be the first in the world without subsidies.