When the Public Utilities Commission of Nevada (PUCN) halted the state’s net metering policy in 2015, the solar energy industry’s sunny skies turned dark. Net metering is an agreement between a utility provider and a solar system owner that lets the customer store excess power generated by the system. The customer can either use the excess power later or send the surplus back to the utility provider for credit. With the capacity to offset most, if not all, of an electric bill and save thousands of dollars, net metering is a major incentive for many people to go solar. Nevada’s net metering ban, which threatened to eliminate energy savings and extend customers’ payback period, made residents opt not to install solar on their properties. With demand for solar at a standstill, the state’s job market took a hit, too. About 32% of solar companies left the state following the net metering ban, and hundreds of Las Vegas solar company employees reported layoffs. The ban brought Nevada’s once booming solar economy to a halt, and it stopped the state in its tracks of using 100% renewable energy by 2030.
To the frustration of solar companies and their customers, the fate of the industry is largely tied to policy decisions at the state and federal levels. While policies have changed regularly in Washington, DC and in many states, the end of net metering surprised many people in Nevada, which has historically been one of the most solar-friendly states. Fortunately, Nevada’s governor Brian Sandoval saw the damage that the net metering ban was doing to the state’s economy and reputation, and he quickly stepped in to help. Governor Sandoval proposed Assembly Bill 405 in 2016, which allows residential customers to receive credit for the energy their systems produce at 95% of their retail electric rate. Another major benefit of the bill is that it locks in rates for customers for at least 20 years, which eliminates the risk of them losing credits and stored energy retroactively. Furthermore, the bill has additional components that encourage solar system installations, including requiring all solar companies to back their systems with a minimum 10-year warranty. AB 405 also requires every Las Vegas solar company to provide transparency in its cost savings calculations.
With the passage of AB 405 as a law in 2017, the state’s solar industry returned to life. Companies that moved out of state following the ban came back. The bill’s passage, which ensures political support for the industry, also attracted the attention of major investors, including Tesla. In 2018, the state is back on track to meet its ambitious goal of installing 2,225 MW of additional solar power by 2023. This will nearly double the amount of solar installed in Nevada to date, and it will bring the number of homes powered by the sun from 425,940 to over 850,000. With this accomplishment, Nevada will once again be a top solar-producing state.