Petition to overturn NV Energy’s demand charge denied

The petition to overturn NV Energy’s demand charge by the Attorney General’s Bureau of Consumer Protection was denied Tuesday.

Clark County District Court Judge Mary Kay Holthus denied the petition for judicial review from the BCP to stop the implementation of NV Energy’s demand charge during a Tuesday hearing.

“I think the decision was supported by substantial evidence after extensive proceedings,” she said.

Attorney General Aaron Ford said in a statement that “the court got it wrong,” and his office will be appealing to the Nevada Supreme Court.

“In the middle of a cost-of-living crisis, it is outrageous for big utility companies to drop yet another expense on Nevadans’ shoulders in the form of the unlawful demand charge,” Ford said in a statement. “This price hike would force hundreds of dollars in new costs onto families who are already stretched thin.”

NV Energy and the PUC did not immediately respond to a request for comment.

With the petition denied, the demand charge is still set to be implemented Jan. 1.

The daily demand creates a two-pronged approach to billing customers each month: how many kilowatts a customer used during their highest 15-minute period of usage combined with the typical per kilowatt hours used each month.

During the more than two-hour hearing, Holthus heard arguments from the PUC, BCP, NV Energy and Vote Solar. Ford also was present for half of the hearing.

Holthus referenced that NV Energy and the PUC had over 40,000 pages of evidence, 70 witnesses, 20 parties and a seven-month long investigation to justify the implementation of the demand charge.

Demand charge called ‘unlawful’

The BCP filed the petition for judicial review against the Public Utilities Commission in December, calling the demand charge “unlawful” and claiming it violates a Nevada law that prohibits mandatory time-of-use rates for all customers.

The petition for judicial review was a final effort from the BCP to overturn the demand charge after its October petition directly to the PUC was denied by the commission.

The BCP also argued to overturn 15-minute netting for net energy metering customers, which will impact only Northern Nevada ratepayers, as well as $2.7 million in affiliate charges.

The BCP maintained its stance during the hearing that the demand charge was an unlawful time-of-use rate and that the commission acted outside its statutory responsibilities.

Much of both sides’ arguments on the demand charge focused on the cost shift borne from serving solar customers, which Holthus heavily focused on.

For Southern Nevada customers, the demand charge is intended to offset the cost shift borne from serving net metering customers. Between 2018 and 2024, the total cost shift borne by non-rooftop-solar customers in Southern Nevada was $424 million, a utility spokesperson told the Las Vegas Review-Journal last year.

90 percent of customers to pay to serve 10 percent

The bureau argued the commission cannot approve or implement rates that remedy a cost shift. NV Energy and the PUC argued it was an unfair subsidy for 90 percent of customers to pay to serve 10 percent of customers, a point Holthus agreed with.

“Throwing out there that 90 percent of the people pay for 10 percent of the people, I just keep coming back to that,” Holthus said.

PUC and NV Energy attorneys also said demand charges have been used for other customers, such as large commercial users, for years. Attorneys also argued that the price of the demand charge does not change throughout the day and is contingent on how many kilowatts the customer uses within a 15-minute period.

“At the end of the day, it sounds like 100 percent of people are going to have better rates,” Holthus said.

NV Energy has continually said most non-net energy metering customers will see a reduction in their rates if their usage habits do not change. Solar, net energy metering customers, will, on average, see about a $12 increase in their bills.

Contact Emerson Drewes at edrewes@reviewjournal.com. Follow @EmersonDrewes on X.