The Hidden Costs of NV Energy’s Summer Rate Cuts: Why It’s Time to Go Solar

NV Energy’s Summer Rate

As the scorching summer months approach, NV Energy, Nevada’s leading utility provider, has announced a plan to cut power rates for three months starting in July. While this move may seem like a relief for customers facing higher energy costs, there’s a catch. The temporary rate cuts come at a price, as they will ultimately burden ratepayers in the future. In this blog post, we will explore the implications of NV Energy’s summer rate cuts and shed light on why now might be the perfect time to consider transitioning to solar energy.

Understanding NV Energy’s Strategy: According to NV Energy’s President and CEO, Doug Cannon, the rate cuts are intended to address the challenges posed by higher energy rates, especially during the summer months. However, these rate reductions are not purely motivated by the utility’s benevolence; they serve as a profitable move for NV Energy. While they can lower rates for a limited period, they are still obligated to purchase sufficient power to meet the cooling demands of homes and businesses in Nevada.

Deferred Energy Purchases and Profits

Under federal law, utilities are prohibited from marking up the cost of energy they purchase. However, Nevada state law grants NV Energy the ability to not only recover the cost of deferred energy purchases (power bought but not immediately collected from customers) but also earn a profit on them, based on their pre-federal tax rate of return. Exhibits filed with the Public Utilities Commission revealed that NV Energy earned a substantial profit of $36.2 million last year on deferred energy balances.

Impact on Ratepayers

NV Energy’s billing structure primarily consists of two components: the base tariff energy rate and the deferred energy adjustment. The former is determined by the utility’s average costs for purchased fuel and power over a 12-month period, while the latter is based on the difference between the actual energy costs and revenues. If costs exceed revenue, the under-collected amount is factored into future rates, allowing the utility to recoup a carrying charge of approximately 8%. Conversely, if revenue exceeds costs, the surplus is either credited against the under-collected amount or refunded to ratepayers later, along with the carrying charge.

Fill out the form to get started on your FREE Energy Audit.

Looking Ahead in Nevada

Public documents indicate that NV Energy is currently under-collected by hundreds of millions of dollars, making it unlikely for ratepayers to receive any credits in the near future. Although NV Energy has the option to request a waiver on carrying charges from the Public Utilities Commission, it has chosen not to do so. This decision means that the utility will continue to charge the carrying fees, further burdening ratepayers.

Solar Energy

With NV Energy’s rate cuts potentially leading to higher costs down the road, it is an opportune time for homeowners and businesses in Nevada to explore alternative energy sources. Solar energy presents a viable and sustainable solution that can help reduce dependence on traditional utility providers. By harnessing the power of the sun, individuals can generate clean and renewable energy, lowering their electricity bills while also contributing to a greener future.

Why It’s a Good Time to Go Solar in Las Vegas

  1. Beat Rising Energy Costs

    With the uncertainty surrounding the future price of natural gas, going solar offers a reliable solution to combat escalating energy expenses. By generating your own clean, renewable energy, you can shield yourself from the volatility of the utility market and take control of your monthly bills.

  2. Immediate Cost Savings

    While NV Energy’s reduction plan offers relief, it’s essential to consider the long-term benefits of solar power. By installing solar panels, you can significantly reduce or even eliminate your reliance on the grid, saving money on electricity bills year-round. Additionally, with various federal and state incentives available, the initial investment in solar can be more affordable than ever.

  3. Environmental Impact

    By adopting solar energy, you can make a positive contribution to the environment. Traditional electricity generation relies on fossil fuels, which contribute to air pollution and greenhouse gas emissions. By harnessing the sun’s energy, solar power produces clean electricity, reducing your carbon footprint and helping combat climate change.

  4. Energy Independence

    Installing solar panels on your property grants you greater energy independence. You become less reliant on external factors like fluctuating energy prices and potential grid outages. With solar power, you have a reliable source of electricity that is both sustainable and resilient.


While NV Energy’s summer rate cuts may provide temporary relief, they should be viewed with caution due to the long-term financial implications for ratepayers. As the utility continues to accumulate deferred energy costs, customers may face higher bills in the future. Embracing solar energy as an alternative power source can offer greater control over energy costs and contribute to a more sustainable and eco-friendly future.


Let Us Help

Find out how we can help you find the best solution for your energy needs in Las Vegas area by scheduling an appointment in the form belowย or calling us at (702) 846-3959.

Fill out the form to get started on your FREE Energy Audit.

Leave a Reply

Your email address will not be published. Required fields are marked *