Commentary: Bill would make power purchases a ‘trade secret’

In the summer of 2010, I persuaded the Public Utilities Commission to make public the prices NV Energy was paying for renewable energy — wind, solar, geothermal, biomass.

The PUC commissioners were easily convinced. The Legislature, not so much. Lawmakers in 2011 promptly passed a bill providing tax abatements for renewable energy producers, but also tacked on a provision declaring the pricing information, and just about everything else in a power purchase contract, confidential trade secrets.

Gov. Brian Sandoval vetoed the bill, because it also had a section that could have cost NV Energy ratepayers as much as $1 billion to build power transmission lines to send renewable power out of state.

That bill — without the transmission line language but with the trade secret provision — has been reintroduced this session as Senate Bill 123. The bill states that any contract, lease or agreement to purchase power would be “deemed to be proprietary and to constitute a trade secret …”

The bill’s sponsor, state Sen. Kelvin Atkinson, said the current language is a starting point and working groups will hammer out particulars. He would not commit to removing the trade secret provision, but said, “Some of this language was put in at the 11th hour on the last day last session, so we all have to do our due diligence and see what’s still applicable or not. We all believe in openness and transparency, so, as I said, the bill will no doubt have some updated language.”

When the PUC agreed to release the prices for seven renewable energy contracts, in June 2010 then-Chairman Sam Thompson commented: “The analogy, although not a good one, is pulling up to the Exxon pump and filling your car up with a piece of black tape over the price per gallon. And I don’t know of anybody in this room who’d do it. I know I wouldn’t.”

The contracts revealed NV Energy was paying 8.1 cents to 13.5 cents per kilowatt-hour for renewable power — two to four times the cost of natural gas-generated power. By state law, 25 percent of Nevada’s electricity must come from renewable sources by 2025.

This past week, when told the trade secrets provision had been reintroduced PUC Commissioner David Noble said, “This came up in June 2010 … the commission agreed with the Las Vegas Review-Journal that pricing information should be disclosed. … I just think it is bad policy to keep pricing of these contracts confidential.”

Noble said, “It’s sort of like, trust the commission, we can see the prices and nobody else can, but trust us, we know what we are doing. I’d much rather have the public weigh in or at least know what we are doing so there is at least a reality check there. I always give the analogy that I like to know when I’m looking for gas what the price is. I’d hate to be going to the pump and filling up and finding out a month later when I get my credit card bill what I actually ended up paying for.”

Both of the other commissioners agreed.

Commissioner Rebecca Wagner said, “I don’t think we can go from releasing the information as we have been, and has been the practice since 2010, to not releasing it. So, I think we can’t put the toothpaste back in the tube. I think we’ve already set this course and it wouldn’t be fair.”

Chairman Alaina Burtenshaw said, “My opinion has not changed since the time I voted to make them public three years ago. We are a public process. We ask the public to pay the rates we set. I think they should know what they are paying for. And I think this process is transparent.”

The commissioners took no formal action on the bill, but advised PUC Assistant General Counsel Garret Weir to use their comments as guidance.

Now, if only the Legislature can be convinced.

There are eight bills pending in Carson City that mention renewable energy. Not one calls for outright repeal of the renewable portfolio standard.

An economic impact study in 2011 by The Beacon Hill Institute in Boston and the Cascade Policy Institute in Portland, Ore., estimated that Oregon’s mandate for 25 percent of power from renewables by 2025, the same as Nevada’s, could increase power bills by somewhere between 14 and 34 percent and reduce the number of jobs in the state by between 10,000 and 25,000. The higher cost of electricity will increase the cost of goods and services.


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