A new optional electricity rate from NVEnergy could help make Nevada a more attractive location for businesses committed to going green.
The rate, approved by the Nevada Public Utility Commission in June, is designed to boost renewable energy production above and beyond the generation mandated by the state’s renewable energy portfolio standard.
The first customer will likely be Apple Inc., which plans to build a large solar array near Yerington to power its planned 750,000-square-foot data center now under construction east of Sparks.
Apple will build the Fort Churchill Solar Array Project on 137 acres leased from NVEnergy. Apple will own it and the utility will operate it with an option eventually to buy the solar farm, assuming the project is approved by the PUC.
Apple will pay an additional Green Rate, a fee layered on top of the usual electricity rate, calculated to contain all the costs associated with the project so no costs are passed along to other ratepayers.
“It’s to make sure other customers don’t subsidize another customer’s use of renewables,” said Bobby J. Hollis II, the executive in charge renewable energy with NVEnergy.
The utility developed it, says Hollis, largely at the request of potential customers, including Apple, that looking at the state.
“Customers were telling us that our neighbors had green energy programs,” he said, including California and Oregon.
The concept appeals to some large, corporate power users such as data centers which are motivated for various reasons to be good environmental citizens.
Google, for example, operates 15 data centers throughout the world, including one in Oregon. The company has pledged to reduce its carbon footprint to zero and says any renewable energy it purchases must be in addition to a state’s portfolio quota.
Nevada economic developers are eager to woo more data centers here. The Apple center, for example, is expected to add 35 full-time jobs, 200 contractor jobs and 500 temporary construction jobs. The center plus an office in downtown Reno will cost about $1 billion over 10 years.
“It’s important that we show we’re on board with renewables,” said Mike Kazmierski, president and chief executive officer of the Economic Development Authority of Western Nevada. “But the reason it’s more important to economic development is it shows the state is willing to look at the needs of our customers and accommodate them.”
Hollis said the utility is talking to other large customers who might be interested in the new rate.
“We’ve had a few confidential discussions on the Green Rate,” said Hollis. “For a new customer, if it’s prerequisite, we want to make sure they can do it here.”
Hollis says he’s also had some discussions with existing customers.
“The motivation is similar,” he says. “They’re trying to demonstrate they’re being more environmental.”
Hollis declined to say who is interested, but the mining industry, a big power user, said it is committed to using renewable energy. Barrick Gold Corp. has installed solar panels at its Goldstrike mine near Elko. Renewable sources provided 19 percent of the mining company’s power in 2012. Newmont Mining Corp. has made similar vows to use renewables and, according to a 2012 report produced by the company, uses hydropower from Bonneville Power in Portland, Ore., for more than 80 percent of its power needs at its Carlin operations in Nevada.
NVEnergy’s new Green Rate is available in two forms: one for anyone, including residential users and smaller businesses, who want to support renewable energy. The rate ensures that additional renewable energy will be added to the grid, although the ratepayer has no guarantee the energy he consumes is generated by renewables.
The second option, utilized by Apple, is for larger customers who want to make a bigger investment. The electricity generated by renewables may also end up added to the overall system, but the ratepayer receives so-called renewable energy credits to demonstrate its commitment. The RECs are issued to NVEnergy by the Western Renewable Energy Information System, which independently tracks renewable generation. The tradable RECs are then “retired” by the user so the generation can’t be credited to anyone else or for any other purpose.