SolarCity announced yesterday that it will cease sales and installations in Nevada after the state’s Public Utilities Commission approved a 75% reduction of the price electric utilities pay for electricity generated from rooftop solar. The new rule makes net-metering uneconomical and “effectively shut down” the homeowner and 3rd party-owned rooftop solar industry in Nevada, giving a monopoly to utility-owned systems.
Just days before Christmas, the timing of the ruling is difficult for the 2,000 local workers SolarCity says it employs in Nevada. SolarCity CEO Lyndon Rive on the announcement:
“This is a very difficult decision but Governor Sandoval and his PUC leave us no choice. The people of Nevada have consistently chosen solar, but yesterday their state government decided to end customer choice, damage the state’s economy, and jeopardize thousands of jobs,”
But it’s also an early Christmas gift to Warren Buffet’s NV Energy, which not only effectively gains a monopoly on future solar energy installations, but also sees a major reduction of the price it pays for excess energy to existing customers.
These customers, over 12,000 of them including schools, purchased their solar installations based on return on investment calculations using the state’s net-metering rules, but they will not be grandfathered into the model and instead will have to follow the new pricing model.
SolarCity describes the situation as a “massive bait and switch”, where the state “helped bring” SolarCity to Neveda and incentivized customers to go solar before turning on them with this new ruling.
SolarCity and other solar installers are reportedly evaluating the possibility of lawsuit against the ruling.