A recent application by NV Energy to the Public Utilities Commission of Nevada is seeking monthly bill increases of about $2.40 in northern Nevada, so that it can establish a $500 million fund to have more liability insurance in case a massive wildfire is caused or worsened by its own utility equipment.
Under the plan, customers in the south of the Silver State, where wildfires are much less prevalent, would see a lower increase of about 50 cents per month.
In a press release from earlier this week NV Energy called the plan “a wildfire self-insurance policy.”
“Wildfires across the United States are becoming more frequent and severe, and utilities like NV Energy must proactively manage wildfire related risks to protect customers and the communities we work to safely serve every day,” NV Energy President and CEO Doug Cannon is quoted as saying. “While NV Energy remains committed to taking actions to reduce the risk of a wildfire occurring in connection with our electric grid, as other utilities in the West have recognized, a self-insurance approach ensures that there is financial support in place in advance of a wildfire occurring to provide greater financial certainty to all involved.”
If approved, the press release indicated “the self-insurance policy will be funded on a jurisdictional basis,” explaining that Northern Nevada residents will cover a larger portion of costs because they face a higher risk of wildfires.
“The rate increase proposed for each region was determined using the same method previously approved by the PUCN for commercial wildfire insurance,” NV Energy wrote. “The policy is proposed [sic] be collected over 10 years to avoid sudden rate increases, providing stability and predictability for customers.”
This new proposal will now be considered by PUCN, which has its next meeting on January 14th.