Yazmyn Pelaez

As energy bills reach record highs, Nevada Legislature passes legislation to increase utility regulation

Bills head to Governor Lombardo’s desk that create more accountability and transparency in utility planning, and promote affordability and clean energy 

CARSON CITY, Nevada — With spikes in fossil fuel prices expected to send summer electric bills to record heights, the Nevada Legislature has passed two bills aimed at strengthening utility regulation to protect consumers and promote affordable clean energy. The bills now head to the desk of Governor Joe Lombardo.

Senate Bill 281, introduced by Senator Rochelle Nguyen, would create a new integrated resource planning process for natural (methane) gas utilities. This transparent and holistic process modeled from existing electric utility planning will allow regulators and other stakeholders to look at all of the utilities’ major projects, consider a range of alternatives, and make decisions in the best interest of customers. Thanks to the hard work of Sen. Nguyen, the bill was supported by conservation and consumer groups as well as Southwest Gas, the state’s largest gas utility. It passed with unanimous support.

Assembly Bill 524, introduced by Assemblyman Howard Watts, would strengthen the integrated resource planning process for electric utilities. The legislation emphasizes the importance of reliable and affordable electricity service and the role that local clean energy development can play in reaching those goals. It would require utilities to submit additional information for the Public Utilities Commission of Nevada to consider in approving new projects, including a new proposal to limit energy purchases on the open market in periods of peak demand. 

Critically, AB 524 calls for the PUCN to put guardrails on the process of submitting amendments to the integrated resource plan. Several organizations criticized the misuse of amendments to approve projects with reduced oversight, including the recent approval of an unpopular and expensive 440MW methane (natural) gas ‘peaker’ plant. NV Energy opposed the legislation, calling for a policy mandate that would have reduced the transparency and accountability of the resource planning process. Despite this, the bill passed with overwhelming bipartisan support. Other states have gone even further to rein in utility spending and political influence. Colorado’s new Utility Regulation Act prohibits investor-owned utilities from charging customers for membership dues in trade associations, lobbying expenses, and activities influencing legislation and blocks utilities from spending customer money on political advertising. This year, Connecticut became the second state to pass legislation barring utilities from spending ratepayer money on political activities. Nevada’s new planning policies are a first step to increasing utility accountability and protecting consumers, with several plans and proposals impacting customer rates headed to the PUCN this summer.

“These pieces of legislation are an important step forward, addressing deficiencies for our current energy planning process and emphasizing the importance of transparency and informed decision-making,” says Nevada Conservation League Deputy Director Christi Cabrera-Georgeson. “These two bills will enable the Nevada Public Utilities Commission to make decisions that increase the use of clean energy and protect ratepayers from excessive utility spending.” 

Other legislation, both positive and negative for energy and utility regulation, failed to advance. Assembly Bill 425, which would have created a strong rooftop solar program for affordable housing developments and taken advantage of new federal funding to increase the state’s deployment of clean energy, unfortunately, did not pass the Legislature in the face of opposition from NV Energy. Senate Bill 353, a proposal to promote the beneficial electrification of homes, also failed to move forward following utility pushback.

Senate Bill 116 was the second attempt in two legislative sessions to mandate billions of dollars in unnecessary gas pipeline replacement despite Nevada’s top safety ratings. The bill received a hearing but did not advance for a vote. Policies were also brought forward to promote hydrogen, an energy-intensive fuel that is usually made from methane. After attempts to establish a strong definition of green hydrogen failed under industry pushback, only a bill to study hydrogen passed the legislature. The study will provide an opportunity to discuss the importance of only producing green hydrogen and using it only in the hardest sectors to decarbonize.


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