NV Energy’s Missing Opportunity: The Case for Non-Wires Alternatives in Nevada

As Nevada’s largest utility ramps up its next long-term resource planning process, the spotlight has been shining on a clean and affordable resource: non-wires alternatives. Now, the Public Utilities Commission of Nevada has the opportunity to lower energy costs and improve the overall health of its communities, but they will need to be provided with an accurate and transparent analysis first.

Recently, after an order from the Public Utilities Commission of Nevada and as part of its long-term planning process, Nevada’s largest utility, NV Energy, released an analysis on non-wires alternatives (NWAs) – like local solar and storage – at lower cost than building ever larger lines, transformers and substations. Vote Solar has been highly engaged in NV Energy’s Distributed Resource Planning process for years, and we’ve made considerable recommendations that call for a more accurate and transparent process.

While the Commission recognized our concerns with NV Energy’s analysis and ordered NV Energy to convene a stakeholder process to address these issues, we should start from the beginning and explain what non-wires alternatives are and why they are so important for Nevada’s clean energy future.

What are non-wires alternatives?

Non-wires alternatives, better known as NWAs, can benefit communities on both economic and climate fronts. NWAs are distributed energy resources that essentially utilize smaller-scale energy resources, rather than the traditional wires and poles we are used to seeing power our homes and neighborhoods. While it might not be the same model you’re used to seeing, there are communities benefiting directly from them today. These ratepayers are able to lean on a reliable source of energy while indirectly saving on carbon emissions and on their electricity bills. 

NWAs are innovative solutions that utilities can use to meet growing electricity needs without building new power lines or other expensive infrastructure. Instead of relying on wires, these alternatives rely on local, smaller-scale resources – like rooftop solar, battery storage, energy efficiency upgrades, or demand response programs – to help supply and manage electricity.

Why do we need NWAs?

Non-wires alternatives fill a gap where traditional power lines fall short in energy system operation. Unlike rigid infrastructure that passively carries power over long distances, NWAs actively optimize how power gets delivered. They slash energy losses due to inefficiency by positioning resources closer to demand, which can ultimately save ratepayers more money compared to conventional methods.

While traditional power lines can only carry electricity one way, NWAs provide enough flexibility to shift loads, store excess power, and respond dynamically to system conditions. This adaptability proves especially valuable for preventing curtailment, balancing energy supply and demand where traditional lines can’t. 

Instead of spending millions (or even billions) on new infrastructure to bring more power from far away, we can use local options to meet demand and keep the grid running smoothly. NWAs can be quicker to implement, usually save money, and reduce the need for construction, which also helps the environment. By investing in resources close to where the energy is used, NWAs also create more resilient communities that are better prepared to handle extreme weather or power outages.

Ultimately, non-wires alternatives help keep electricity reliable and affordable by reducing the need for costly new infrastructure, while supporting clean energy solutions that benefit people and the planet.

Where did NV Energy go wrong?

NV Energy underestimated the value that NWAs can bring to Nevada’s energy system. Utilities across the country underestimate energy sources like local solar and non-wires alternatives, and they have major incentives to do so. Utilities are motivated to do this because investors earn a profit on these expenditures, which are included in their rate base. These investments cost billions. In fact, U.S. regulated utilities have invested about $55 billion a year in poles and wires (often utilities’ biggest spend) since 2006.  But utilities can save ratepayers money by using resources like non-wires alternatives, providing reliable service to customers instead of the traditional route. 

In our testimony for this Integrated Resource Plan, we shared six major flaws we found in their analyses:

1. Limiting DER benefits to only 10 years when the equipment can last at least 20 years longer
2. Only including avoided system loss benefits through 2033, instead of the full life of the equipment
3. Omitting Investment Tax Credits from the 2022 Inflation Reduction Act, inaccurately capturing the costs of clean energy investments
4. Incorrectly applying property tax and operation/maintenance costs to customer-owned local clean energy resources (including solar, storage, and other technologies) that support an affordable energy transition
5. Using artificially low capacity limits on energy efficiency and demand response potential, when the capacity is much higher
6. Excluding customer-owned battery storage as an NWA option, when this is typically a major benefit to stakeholders

The bottom line: NV Energy is inflating the costs and excluding a lot of the benefits of local, clean energy. They’re doing what’s in their power to prevent communities from working with what’s best for their wallets, the economy, and the climate.They’ve shown little transparency and delayed the implementation. Now is the time to hold them accountable to providing accurate, unbiased analyses to stakeholders, the commission, and the general public. 

What the Public Utilities Commission of Nevada can do

As Nevada’s energy landscape continues to evolve, the effective integration of local, clean energy resources has become increasingly critical to our energy future. Based on a thorough analysis of NV Energy’s approach, Vote Solar has identified several key areas where improvements are needed to better serve Nevada ratepayers and advance the state’s clean energy goals.

Recommendations to the NV Commission:

1. Correct NWA Analysis: Order NV Energy to revise its NWA modeling to address the identified flaws and rerun analyses for all flawed variables.
2. Implement Cost-Effective NWAs: Require NV Energy to develop proposals (RFPs) for third-party local energy aggregators within 90 days for all NWAs showing net benefits in the analysis.
3. Remove barriers: Clarify that Nevada regulation does not require any additional evaluations or obstacles when considering non-wired alternatives.
4. Improve DER forecasting: Deny NV Energy’s request for a waiver from net load forecasting requirements and mandate the use of more accurate distributed energy resource adoption projections.
5. Enhance hosting capacity analysis: Require NV Energy to use actual daily solar generation curves in its analysis, accounting for orientation and shading.
6. Address utility ownership: Clarify that NV Energy cannot own behind-the-meter energy resources to meet their Distributed Resource Planning requirements.
7. Stakeholder engagement: Ensure future stakeholder processes are led by a neutral third party to facilitate genuine dialogue and input.

By implementing our recommended changes, the Public Utilities Commission of Nevada has the opportunity to create a more equitable, transparent, and effective framework for clean, local sources of energy. Nevadan ratepayers deserve genuine access to cleaner, more cost-effective energy solutions that will benefit their communities for generations.

The time for meaningful reform is now. With proper oversight and the right regulatory framework in place, we can unlock the full potential of non-wires alternatives in the state and create a lower cost, more sustainable, and resilient energy future for all Nevadans.