Nevada Voters Could Eliminate Monopolies in Their State’s Energy Market

Nevada’s energy market is currently a monopoly, with all energy provided by NV Energy, except for rural cooperatives that get exemptions. Nevadans could change that with their vote on Question 3 this November.

What the Initiative Does

Question 3 would amend Nevada’s state constitution to require the state legislature to pass laws to establish an open, competitive energy market in place of NV Energy’s current monopoly by July 2023. It’d prohibit the state from granting electrical-generation monopolies, and protect “against service disconnections and unfair practices." It’d also declare that individuals, businesses, and political subdivisions have a right to choose their electricity service provider, and can’t be forced to purchase electricity from one provider.

Argument in Favor

Deregulating Nevada’s energy market will give customers more choices, and create competition that’ll help bring energy prices down as suppliers compete with each other for customers’ business. With no competition, NV Energy has absolute power over pricing, and customers don’t have any choice but to pay its prices, no matter how high.

Argument Against

NV Energy has price protections in place that’d go away if Question 3 passes — so customers’ energy prices could go up. Additionally, passage of Question 3 would derail NV Energy’s current plans to increase renewable energy use, putting the state’s environment at risk and creating uncertainty for the state’s rooftop solar industry.

In-Depth

Nevadans for Affordable, Clean Energy Choices, primarily funded by data-storage firm Switch and billionaire donor Sheldon Adelson’s Las Vegas Sands Corporation, is leading the campaign in support of Question 3. Sen. Dean Heller (R-NV), former Sen. Harry Reid (D-NV), the Nevada Resort Association, and gubernatorial candidate Adam Laxalt also support Question 3. Sen. Heller’s campaign spokesman, Keith Schipper, says: “As a supporter of deregulation, open markets and more choices for consumers, Sen. Heller supports Question 3 because he believes it will bring more alternative energy to Nevada.”

The Coalition to Defeat Question 3, which is almost entirely funded by NV Energy, is leading the opposition to Question 3. Additionally, Senate candidate Jacky Rosen (D), the Nevada Mining Association, gubernatorial candidate Steve Sisolak, and the Nevada Cattleman’s Association oppose Question 3. The No on 3 campaign argues that NV Energy has price protections in place that’d go away if Question 3 passes, potentially raising electricity costs for customers:

"We have one of the most affordable and reliable electricity systems in the nation. Nevada's average electricity rates are already 17% below the national average. In fact, in deregulated states[,] electricity rates are actually 30% higher than Nevada's rates.”

The Sierra Club, Natural Resources Defense Council, the Sierra Club, Southwest Energy Efficiency Project, and Western Resource Advocates oppose Question 3, as they believe its passage could disrupt Nevada’s progress toward a clean energy future.

This initiative made it to the ballot after more than 112,543 valid signatures were submitted by supporters.

Summary by Lorelei Yang

(Photo Credit: iStockphoto.com / Kagenmi)