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Quarantining the utility: State regulators should adopt a competitive retail electricity market 2.0

EDITORIAL: We’re way past due for a competitive retail electricity market 2.0. On a whim I answered the phone despite knowing it was a telemarketing call. The robocaller invited me to press 1 if I wanted to save 30 percent on my electricity bill. The invitation was too good to pass up. I was soon patched through to a man who identified himself as being with the “supply department” for my local utility company. I asked him to confirm what he said, that he was calling from my local utility, which I knew to be a lie. He repeated the misrepresentation and asked me to get a copy of my electricity bill. He hung up on me as I scolded him for scamming people.

The next day I answered the phone again, this time a woman invited me to save 10 percent on my electricity bill. I was entitled to the savings because of a state law, she said. The telemarketer, reading from a script, got flustered as I interrupted her to ask that she repeat her introductory misrepresentation that she was calling from my local utility provider. She returned to her script and asked me to get a copy of my electricity bill. I put the phone down while I attended to something else, determined to waste as much of her time as possible.

When I returned to the phone and told her I couldn’t find my bill, she patched me through to her supervisor. When I asked the supervisor to confirm that she was with my utility company, she admitted she wasn’t and attributed the initial misrepresentation to that person, who was clearly reading from a script, being new to the job. She said if I could just get my utility customer number she could see to enabling me to obtain a 10 percent savings in electricity. So if she wasn’t with my utility company, who did she represent, I asked. “Choice Energy,” she replied.

So I asked, since she wasn’t representing my utility provider, if having Choice Energy provide me with a 10 percent savings on electricity wouldn’t require me to enter into a contract. She said there was no contract involved. There would be no signup fee or cancellation fee either, she said. After some more pointless dissembling I lost patience and hung up without bothering to explain that a contract is the predicate for signup and cancellation fees.

When you go to the website for Choice Energy, the tag line is “America’s Trusted Choice.” Headquartered in Iowa, I reached Mike Needham, the company’s owner. He said the company wasn’t marketing in my area, and wasn’t even licensed to be a supplier in my state. He suggested it might be another company, based in Houston, which has “choice energy” in its name, or another company altogether. “We’ve received complaints similar to this in the past,” he said. Calls to the Houston-based company were not returned.

These experiences aren’t unique to my area or me. State regulators in several states where consumers can choose among competing energy suppliers – particularly Connecticut, Illinois, Massachusetts and New York – are increasingly alarmed by these sorts of misrepresentations by marketers. After gaining the trust of the customer, either at the door or over the phone, these marketers, once they’ve obtained the utility customer number, switch the customer to another supplier, either with some form of consent or without their knowledge. There may actually be a savings involved for a few months, but then the price gets jacked up and the customer ends up paying more for electricity than if they’d stayed with the default service of their utility company.

This is a huge problem that threatens the future of retail electricity competition and the great promise of competition-driven innovation in products and services. In many cases the competitive electricity supplier doesn’t even necessarily know these questionable marketing practices are happening. They typically contract out the marketing effort, and the marketing contractor engages marketers on a commission basis, providing a financial incentive for playing fast and loose.

At the recent conference, “Growing the Power Business & Cutting Carbon Emissions,” sponsored by the University of Pennsylvania’s Kleinman Center for Energy Policy, Pennsylvania Consumer Advocate Tanya McCloskey cited concerns about “false and misleading marketing” and called on competitive suppliers to be part of the solution.

That’s fair but too many policymakers are painting the entire industry with a broad brush. Rather than take meaningful steps to reform the utility-dominated market structure, which in most states utilizes a 20-year-old market model badly in need of a major revamp, they have proposed shutting down entirely the residential customer market except for municipal aggregation. In the end that will deprive consumers of not only their right to choose, but will blunt the wave of innovation in electricity products and services policy makers can enable by quarantining the utility from the competitive marketplace.

The current model for retail electricity competition, employed by all the states with competitive retail choice except for Texas, makes utility service the default option that customers receive unless they choose to purchase from a competitive supplier. The incentive to shop is muted since the utility is purchasing power on behalf of its default customers in the wholesale power market and passing that product through at cost. The utility can do this because it is making money from its monopoly-regulated transmission and distribution services. And if it makes a mistake or the wholesale power market takes a twist it didn’t anticipate, the utility can go to state regulators and ask to be made whole through regulated rates.

These are not options that competitive retail suppliers have. They, too, must obtain power for their customers in the wholesale market, but they don’t have transmission and distribution wires with monopoly-guaranteed rates that allow them the luxury to provide power at cost. They have no recourse if they bet wrong on the market price. And the utility doesn’t incur any marketing costs to obtain its commanding share of the market. Given this, it is wholly unfair and unreasonable to compare the rates of competitive suppliers with the price of default service, as all too many state officials are doing.

Further, competitive suppliers are often relegated to a line item on the utility bill, and that line item may not even list the supplier by name. The ability of competitive suppliers to interact with their customers through the bill is virtually nonexistent, hindering their ability to offer value-added products and services that differentiate the supplier from their competitors.

We need to find a better way. Yes, competitive suppliers can and must do more to police their ranks and help regulators oversee the marketplace. In particular, they must move beyond simply offering free airline miles as an example of innovation in the marketplace. But the unfair and anticompetitive market structure used in all the competitive states except Texas needs a major overhaul. We need a competitive retail electricity market 2.0. Only once the market power-wielding utility is quarantined from the market will electricity consumers begin to enjoy a truly competitive market offering innovation and value beyond simply providing electrons.

By moving to a competitive retail electricity market 2.0 state officials will unleash the same kind of sweeping innovation we saw in telecommunications, which led to incredible technological change benefiting consumers and the economy as a whole. Today’s electricity system is the equivalent of a black rotary phone with a wire running into the wall. We need to move to an electricity equivalent of the smart phone. If we do, we’ll not only unleash unquantifiable economic benefits, but sweeping clean energy development and energy efficiency that benefits the environment as well.

Yes, competitive energy suppliers can and must do more to police their ranks. But state policy makers must move beyond a decades-old market design that helps perpetuate problems for consumers and adopt a competitive retail electricity market 2.0. Retreating to failed monopoly-regulated rates for residential consumers is a betrayal of consumers and a recipe for inefficient clean-energy development.

[Disclosure: The writer formerly was a consultant to the Retail Energy Supply Association.]

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Senate Democrats decry FERC nominee’s refusal to concede need for recusal

Today’s lede: McNamee’s refusal to acknowledge need for recusal. At Thursday’s confirmation hearing Senate Democrats repeatedly pressed Bernard McNamee, President Trump’s nominee to fill the vacant seat at the Federal Energy Regulatory Commission, to recuse himself from a pending proceeding at the commission that is an outgrowth of the administration’s proposal (RM18-1) to impose consumer subsidies to support uneconomic coal and nuclear plants in wholesale power markets.

McNamee, who has been in and out as a political appointee at the Department of Energy over the course of the past two years of the Trump administration (interrupted by a short stint at a conservative think tank where he advocated the benefits of fossil fuels), reportedly was the author of the proposed rule to impose consumer subsidies for baseload coal and nuclear plants, which FERC unanimously rejected earlier this year. But while the proposal was rejected, the commission initiated a proceeding (AD18-7) to examine the “resilience” of the power grid and whether FERC should reconsider its rules overseeing competitive wholesale power markets to somehow prevent coal and nuclear generation plants from closing because they are no longer economic resources in the markets.

McNamee in both his prepared testimony and remarks before the Senate Energy and Natural Resources Committee repeatedly said he would be an “impartial arbiter” respectful of FERC’s role as an independent agency and quasi-judicial agency. But he declined to say whether he needed to recuse himself, given his past roles that clearly represent a conflict of interest. He appeared to imply that he could participate in that proceeding if he is confirmed since FERC rejected the proposed rule “and opened a new docket.” Repeatedly pressed about whether he would recuse himself from the proceeding, McNamee said he would consult with ethics counsel.

Sen. Ron Wyden, D-Ore., described McNamee’s appointment as not a case of the fox guarding the henhouse, but placing the fox inside the henhouse. “I believe you need to recuse yourself,” Wyden said.

Sen. Angus King of Maine, an independent who caucuses with the Democrats, recited the pertinent law to declare that McNamee had a clear legal obligation to recuse himself from the proceeding.  King said he was surprised and disappointed by McNamee’s response that he would consult with ethics counsel, rather than acknowledge the clear need for recusal.

Sen. Lisa Murkowski, R-Alaska, the committee’s chairman, said she expected the committee to advance McNamee’s nomination later this month.




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Industry speakers call for new competitive market construct that better meets clean energy policy goals

DATELINE, Hershey, Pa. – ‘Growing the power business and cutting carbon emissions’ was the theme of the Third Annual Regional Executive Energy Summit in Hershey, Pa., Nov. 8-9, sponsored by the University of Pennsylvania’s Kleinman Center for Energy Policy. The agenda and discussion, spearheaded by former Pennsylvania regulator John Hanger, had its finger on the pulse of the regulatory Gordian Knot that is hindering the progression of the electric industry’s necessary evolution from a 19th century monopoly-regulated paradigm to a clean-energy future in which regulatory barriers to innovation are removed and competition fosters economic, innovative and cleaner resources and service providers.

Gordon van Welie, president and CEO of ISO New England, warned that the U.S. risks repeating the mistakes of Germany, which failed to adequately price the environmental cost of carbon emissions while shutting down nuclear generation and making a big commitment to renewable energy, which resulted in the unintended consequence of higher carbon-emitting coal-fired generation.

Andy Ott, president of PJM Interconnection, which operates the nation’s largest competitive wholesale power market, agreed. Germany wanted to get to zero carbon emissions and went in the opposite direction, he said.

The New England market that van Wylie oversees is Ground Zero in the retrenchment away from the economic and environmental gains that competitive electricity markets provided, as state policy makers rush to embrace mandates for specific resources, such as offshore wind energy and Canadian hydropower.

Because the federal government is not adopting policies providing a price on carbon emissions, states are ratcheting up renewable portfolio standards and out-of-market power purchase agreements for favored clean energy resources, which “create a whole set of unintended consequences,” van Wylie said.

“We’re starting to see the system crack in New England,” said Abraham Silverman, NRG’s vice president and deputy general counsel. The region is on track to mandate the procurement of some $400 million in out-of-market resources by the 2023-2024 timeframe, he noted.

Dan Dolan, president of the New England Power Generators Association, summarized the threat to New England’s competitive market gains in a column published by Utility Dive Sept. 5. “State-subsidized contracts for thousands of megawatts of new resources are hitting the competitive market and are set to exceed 60 percent of all electricity consumed in New England over the next several years,” Dolan wrote.

As New England states authorize long-term out-of-market contracts to meet clean-energy policy mandates, power generation resources are increasingly unable to recover their costs in the market, Dolan noted.

“On the current trajectory, the state of the New England electricity market will rapidly worsen, requiring further out-of-market actions to adequately compensate generators in order to preserve grid reliability. State subsidies will beget reliability subsidies, driving consumer costs ever higher and doing away with future market-based investments for new or existing power generation,” Dolan wrote. “If immediate action is not taken to address the accelerating cycle of out-of-market activity, the remarkable benefits New England consumers have reaped from competition will be upended, requiring a return to consumers bearing the costs of resource investments.”

ISO New England’s Van Wylie, speaking in Hershey, summarized the competitive gains at risk, noting that in the past 20 years New England’s electricity costs have declined by 50 percent as consumers have not been financially at risk for resource investment decisions in the region’s competitive wholesale electricity market. That enormous economic value was accompanied by a tremendous reduction in harmful emissions, van Wylie noted. But those gains are being put at risk as state policy makers seek further environmental gains through out-of-market mandates.

Van Wylie noted that 20 years ago all resources in New England were built with consumers guaranteeing the financial risk of the investment. Under competition, the region went to 95 percent of generation resources being provided by merchant generators dependent on returns from the market, rather than guaranteed returns from captive consumers. Now the region is “whipsawing back” as it is on track to have between 50 percent and 60 percent of resources from state-mandated out-of-market power purchase agreements, he said.

Speakers at the conference in Hershey called for a new regulatory paradigm that preserves competitive markets as a driver of clean energy and consumer value.

“We need a new framework. We need a system that internalizes environmental costs,” said Kathleen Barron, senior vice president for regulatory affairs and policy at Exelon Corp.

Consumers are “at risk” in the absence of a market structure that meets the  zero-carbon energy goals of state policy makers, Silverman said, calling for commoditizing environmental costs within the existing markets so “entrepreneurs can come in and solve the problem.”

Panel discussion participants disagreed as to whether congressional action is necessary before the Federal Energy Regulatory Commission-regulated organized wholesale power markets can begin internalizing the cost of carbon emissions. Ott and van Wylie, the heads of two prominent FERC-regulated competitive markets, said no. But Barron, who prior to joining Exelon was deputy general counsel at FERC, disagreed.

“FERC has the legal authority within its existing statute to say rates are not just and reasonable without pricing this externality,” Barron said. “We need a new framework. We need a system that internalizes environmental costs,” she said.

NRG’s Silverman, also a FERC alum, agreed. “We need to have the states, the RTOs and FERC on common ground,” he said, calling for FERC to adopt a rule providing that “part of a just and reasonable rate” includes the pricing of environmental externalities.

In addition to problems plaguing the competitive wholesale markets, the discussion in Hershey also addressed lingering retail market-design problems preventing greater customer value and clean energy gains. In particular, speakers cited the need for consolidated supplier billing and an end to utility default service as a price comparison to competitive supply.

Leah Gibbons, director of regulatory affairs at NRG Energy, summarized the frustrations of competitive retail suppliers. The incumbent utility controls the wires, manages customer billing and therefore the supplier’s interface with its customer, and has access to all customer information in the market, Gibbons noted. Further, she noted the utility in response to state mandates for energy efficiency can recoup its costs from captive customers through wires charges, something competitive suppliers can’t do.

The problems that persist in competitive retail power markets are because “a real full unbundling” of utility rates did not occur, Gibbons said. She noted that in New Jersey, one utility’s billing system doesn’t even list the name of the competitive supplier, instead listing the commodity charge as being from a “third-party supplier.”

She called for consolidated supplier billing, so competitive retail suppliers can control the billing interface with the customer. She also called for ending the utility’s role as a default service provider, or at the least making default service “a last resort, not a first resort.”

Competitive electricity suppliers can disrupt the electricity sector just as Uber did transportation, and Blockbuster-killer Netflix did for home entertainment, but there needs to be “a level playing field,” said Manu Asthana, president, North American Home, Direct Energy. Suppliers should not be required to compete against a utility default price that doesn’t offer a proper benchmark for comparison, he said. Asthana also echoed NRG’s concerns about the lack of consolidated billing and utility control of customer data. “I want to have a relationship with the customer so I can improve their life in some way,” he said.

The growing concerns among regulators in competitive states about the prices provided by competitive suppliers are a result of the “inefficient construct” in competitive states, Gibbons said. “We need to start addressing these underlying issues.”

But state officials appeared to be on different pages when it comes to reforming retail electricity markets.

“We view the competitive market as the best driver of innovation,” said John Fiastro, director of government affairs and communications at the Maryland Energy Administration. “We need a fundamental shift in the market,” he said.

But Tanya McCloskey, Pennsylvania’s consumer advocate, faulted competitive suppliers for not doing a better job of policing “false and misleading” marketing by suppliers and their contracted marketing firms. “Energy is not like any other product,” she said, calling electricity “an essential service.”

“Food is an essential product but we don’t set the price of food,” Direct’s Asthana noted.


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Arizona Corporation Commission initiates workshop process to flesh out electricity competition; will consider interim expansion of competitive access Dec. 17

Today’s lede: Arizona utility regulators to begin retail electricity competition workshops next month. When one door closes, another opens. One day after Nevada voters rejected a ballot initiative that would have ended monopoly regulation in that state, across the state line the Arizona Corporation Commission late Wednesday agreed to begin a workshop process to help frame a new policy addressing retail electricity competition in the state.

In the closing minutes of a daylong open meeting, Commission Chairman Tom Forese brought up the last agenda item for discussion, building on a rulemaking (RU-00000A-18-0284) launched in August that would modify the commission’s Energy Rules regarding retail electricity competition. Specifically, Forese called for the commission to initiate a workshop process beginning Dec. 3 to, as Forese described, “have a comprehensive discussion on competition in Arizona [and] everything this would entail.”

Forese nominated Commissioners Boyd Dunn and Bob Burns as co-chairs, noting that he would attend but not chair the workshop process.

“I’ll be happy to co-chair with commissioner Burns,” Dunn said. “This issue of deregulation can go so many different directions. When this was discussed before, how many workshops were there?”

Dunn referred to the commission’s last dalliance with a formal regulatory process considering opening the state’s monopoly-regulated electricity market to competition, only to suddenly conclude in September of 2013 that the state’s constitution barred the regulators from taking action.

Elijah Abinah, the ACC’s utilities division director, responded that the commission’s previously aborted effort to consider electricity competition in Arizona had encompassed “at least 30 workshops.”

“Mr. Burns and I will be at this for quite a while,” Dunn replied.

New competitive access program to be considered at December open meeting. Forese asked staff to put together a “conceptual bridge to retail competition” in time for consideration during the next ACC open meeting Dec. 17. The ACC chairman called for establishing a new program similar to the ag-x rate rider at Arizona Public Service, which allows the utility’s largest electricity customers to obtain their electricity needs from competitive suppliers, with the utility obtaining the power and “wheeling” it to the customer. Forese called for development of “something similar” to the ag-x rider, but that “specifically would be available for smaller users.”

In a last-minute exchange, Abinah confirmed with Forese that the ongoing development of an electricity competition policy in Arizona will not encompass the state’s rural electric cooperatives. Abinah also indicated that a policy relating to electric vehicles also will be forwarded to the commissioners next month.

The developments appear to indicate the ACC will hit the road running next month in what could potentially result in Arizona becoming the first state to proactively open its electricity market to competition in the wake of California’s epic failed restructuring effort, which devolved into a calamitous financial crisis in 2000-2001. While at least a dozen states have opened their markets to competition, all of these restructuring efforts were initiated by state policy makers prior to California’s infamous energy crisis. In the wake of California, many states, including Arizona and Nevada, stepped back from developing restructuring programs. In Virginia, the state reversed course and re-monopolized just as utilities were about to lose their monopoly protection, and in Michigan utilities convinced lawmakers to ratchet back competitive access, limiting customer choice to just 10 percent of each utility’s load.

Arizona has embarked on a course that could establish the state and the commission as trail blazers on transitioning from monopoly regulation to competition, potentially establishing a regulatory record and a framework that other states, such as neighboring Nevada, could adopt. But it remains to be seen how far the ACC will take this. As Dunn indicated, it appears to be the start of a lengthy process. Nevertheless, competition advocates should be encouraged that Forese has called for rapid development of an interim program that would expand competitive access as the regulators struggle to work out a broader retail competition program in the long term.


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Money prevails as energy choice ballot measure craps out in Nevada and Steyer-funded RPS ballot measures see mixed results

Special election edition: Nevada voters reject Question 3 as Tom Steyer nets an initial win with just one of his renewable energy mandate ballot measures. Nevada’s voters yesterday roundly rejected Question 3, the ballot measure that would have ended monopoly utility regulation and allowed the state’s electricity consumers to choose among competing suppliers. The measure was rejected by roughly two of every three voters, marking a resounding victory for the unprecedented $63 million or more spent by the NV Energy-funded effort to defeat the ballot measure. NV Energy, a unit of Warren Buffett’s Berkshire Hathaway business empire, is the predominant utility in Nevada.

The vote yesterday was almost an exactly inverse outcome from two years ago, when the energy choice ballot measure was approved by more than 70 percent of voters. In order to effectively change the state constitution to end monopoly regulation and allow electricity competition, the ballot measure must be approved by voters twice.

So what was the defining difference between the two elections and their decidedly lopsided outcomes? NV Energy stayed neutral in the 2016 election and did not wage a fear campaign to defeat the measure. This time around the campaign against Question 3 outspent the “yes” campaign by a 2-1 margin, and defeated the ballot measure. The “yes” campaign was largely supported financially by Las Vegas Sands Corp. casino mogul Sheldon Adelson, a leading funder of GOP candidates and policies, and the data services giant Switch.

The defeat of Question 3 was among a suite of ballot initiatives that oil and electric industry interests spent big money to successfully defeat yesterday. The list includes the rejection by Washington State voters of Ballot Initiative 1631, which would have imposed a modest $15/ton carbon emissions tax; Colorado voters’ rejection of Proposition 112, a measure that would have restricted hydraulic fracturing in the state; and the defeat in Arizona of Proposition 127, a measure funded by billionaire Democratic activist Tom Steyer that would have imposed a 50 percent renewable energy mandate by 2030.

“The industry wins are stark examples of how money-fueled negative messaging can persuade voters,” Ben Geman writes in the Axios Generate daily newsletter.

“Typically money does win,” said Denise Roth-Barber, an analyst with the National Institute on Money in State Politics. “If you have a tremendous amount of money you can get your message out,” Roth-Barber said in a telephone interview. But she emphasized that money doesn’t always prevail, citing examples where industry interests spent big to pass a ballot initiative but voters were unpersuaded.

But the experience in Nevada with Question 3 – which The Nevada independent dubbed “the most expensive ballot question in Nevada history” – appears to offer an object lesson in money prevailing. Without heavy spending by NV Energy to defeat it, nearly three in four voters approved Question 3 in 2016. Yesterday, after NV Energy spent tens of millions of dollars in a campaign to persuade voters that electricity competition would threaten renewable energy development and stable electricity rates, some two in three voters rejected the measure.

The object lesson doesn’t end there. In Arizona, Steyer’s Prop 127 went down in flames after utility interests in the state – particularly Pinnacle West’s Arizona Public Service – spent more than $25 million to defeat the measure. In contrast, Nevada voters resoundingly approved by a 3-2 margin Question 6, another Steyer-funded ballot measure which would require Nevada to meet 50 percent of its electricity needs with renewable energy sources by 2030.

The difference in those two outcomes is that, like in 2016 with Question 3, NV Energy stayed on the sidelines and did not oppose Question 6, which must be approved by voters a second time in order to take effect. It remains to be seen whether NV Energy will remain on the sidelines in two years when Question 6 comes before voters again, or will repeat its Question 3 playbook and spend big to defeat it in the required second vote.

In other election results, concerns about massive cost overruns at the Plant Vogtle nuclear power plant expansion project – and resulting rising electricity costs for consumers – apparently did not dissuade voters from supporting the two Republican incumbents in Georgia’s Public Service Commission elections. Chuck Eaton and Tricia Pridemore, who generally are pro-nuclear and pro-Southern Co., appear to have prevailed against challengers who had questioned the $30 billion in spending on the nuclear expansion effort and leaned in support of greater renewable energy development in the state.

Meanwhile, in Arizona, Republican incumbent Corporation Commission member Justin Olson, one of three sitting commissioners who have supported reconsideration of electricity competition in the state, and fellow Republican Rodney Glassman, appear to have prevailed against Democratic challengers.

Buried lede: The Arizona Corporation Commission’s open meeting got under way today with an agenda item that could involve a vote on a rulemaking (RU-00000A-18-0284) that would modify the Arizona Corporation Commission’s Energy Rules regarding retail electricity competition. Details to follow.


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Election highlights: Will Nevada go ‘all in’ on electricity choice? On election eve, Arizona regulators add retail electric competition to meeting agenda

Special election edition: Rolling the dice in Las Vegas as RPS ballot initiatives are in a Steyer situation. “There is great electricity in the air,” President Trump said on the campaign trail last night. But while all eyes are on the balance of power in today’s mid-term election, it is also without question one of the most consequential in terms of the obscure issue of electricity regulation as any in memory. Like a gambler on winning-streak high, voters in Nevada will decide, all in, yea or nay, whether to amend the state’s constitution to end monopoly regulation of electric utilities, namely Warren Buffet’s NV Energy, and allow the state’s consumers to shop among competing electricity providers.

The most recent Rasmussen poll (September) doesn’t bode well for Nevada’s Question 3, as the customer choice initiative is known. Las Vegas Sands Corp. gambling mogul Sheldon Adelson, who happens to be a big financial supporter of the GOP agenda and candidates, has been outspent 2-1 in an unprecedented $100 million advertising war over today’s vote. It is the second of two required votes. The initiative must be passed twice by voters in order to effectively alter the state’s constitution.

In the 2016 election, voters overwhelmingly approved the energy choice initiative. More than 70 percent of voters agreed that monopoly protection for NV Energy should end, and consumers should be able to choose among competing suppliers of electricity.

NV Energy remained neutral two years ago, leading to the landslide approval of the initiative. This year, NV Energy, a unit of Berkshire Hathaway, went all in, wagering some $70 million that a fear-mongering campaign over the prospects of electricity competition in the state will sway voters to reject the ballot question as risk to continued renewable energy investment and stable rates. Supporters have countered with the fact that more than a dozen states have adopted competitive retail energy markets for electricity, driving down consumer costs and enabling cleaner energy-generation technologies.

If Question 3 fails to muster enough votes today, it likely won’t be the end of the debate in Nevada. Especially since many political leaders expressed support for competition, but rejected the constitution-altering ballot measure as the vehicle for effectuating such a change. Pass or fail, the debate over electricity restructuring in Nevada will move to the state Legislature after today’s vote.

The Arizona Corporation Commission election will determine the line up as the commission appears poised to revisit the idea of retail electric choice. Incumbent Justin Olson and fellow Republican Rodney Glassman face off against Democrats Sandra Kennedy and Kiana Sears. Olson and fellow commissioners Robert Burns and Boyd Dunn have suggested the state revisit the idea of restructuring to promote electricity competition. Tomorrow’s commission agenda has been amended to include a “possible vote on a policy regarding retail electric competition.”

While the mainstream media’s attention will be on pivotal Senate races in Nevada and Arizona, the trade and financial press will be watching to see what happens with two Tom Steyer-funded ballot initiatives to establish stricter renewable energy mandates in those sun-rich states. There is a marked contrast in how utilities in the two states have responded to the ballot measures that billionaire Democratic activist Steyer has spent millions to promote. In Nevada, NV Energy has not weighed into the fray against Question 6, which would require at least 50 percent of the state’s electricity to come from renewable sources by 2030. Arizona’s Proposition 127 also would create a 50 percent renewables mandate by 2030, but the state’s utilities – Pinnacle West in particular – have spent millions of dollars to thwart its passage. Another important ballot initiative is in Washington State, where voters will decide whether to impose a tax on carbon emissions. Ballot Initiative 1631 would impose a $15 dollars per ton fee on carbon emissions, an amount that would rise $2 per ton annually until the state meets specified emissions-reduction goals.

Meanwhile, the election of Public Service Commission members in Georgia promises to be a de facto referendum on the state’s commitment to impose nearly $30 billion in costs on the state’s electricity consumers to build two new nuclear power reactors at the Plant Vogtle nuclear power station. With generous campaign finance support from Southern Co., Georgia’s PSC has always been friendly to the utility giant’s agenda. But this year candidates have stood out in their opposition to the immense costs that Southern’s nuclear development program is imposing on consumers, while calling for the state to do more to promote renewable energy development.

In two PSC races, challengers have been running against the incumbents’ support for the expensive nuclear development program. Republican incumbent Chuck Eaton and Democratic challenger Lindy Miller have been engaged in a rhetorical battle over the extent to which Georgia’s electricity costs are increasing. That race also features Libertarian candidate Ryan Graham. Republican incumbent Tricia Pridemore, an ardent proponent of the Vogtle nuclear expansion and nuclear power in general, faces Democrat Dawn Randolph and Libertarian John Turpish.

A win by the nuclear cost-skeptical challengers could mark a turning point in the state’s Southern-dominated regulatory climate.