Advocates warn that Nevada’s new demand response frameworks fail to adequately compensate distributed energy resources, keeping NV Energy in control of grid modernization.
The new demand-response frameworks align the state with other pay-for-performance virtual power plant models while keeping NV Energy in control. According to the commission, the Grid Services Rider tariffs will replace a narrower demand-response framework that has been in place for 15 years, adding NV Energy to the list of U.S. utilities overseeing or participating in pay-for-performance virtual power plants. Most Nevadans receive electricity through NV Energy’s two subsidiaries, Nevada Power Company and Sierra Pacific Power Company. NV Energy is owned by Berkshire Hathaway Energy, a subsidiary of the publicly traded industrial conglomerate founded by Warren Buffett.
The Solar Energy Industries Association, Solar United Neighbors, and Advanced Energy United urged the commission to modify the tariffs to allow customers to assign performance compensation from batteries, thermostats, and other distributed energy resources to third-party owners, portfolio aggregators, and original equipment manufacturers. Advocates also requested that the commission require NV Energy to implement a digital platform for secure, customer-consented data sharing with third parties. Additionally, they asked that NV Energy include a virtual power plant resource category in its next Integrated Resource Plan, accounting for VPP capacity and energy alongside other supply resources.
NV Energy opposed all three requests, according to a commission summary of the proceedings. Regarding compensation assignment, the utility cited technological, commercial, and wholesale market barriers that make the practice impractical in the near term. On data sharing, NV Energy argued that a digital exchange platform is unnecessary to implement the proposed tariffs or load-flexibility programs, noting it holds little relevance in Nevada’s vertically integrated market, which prohibits retail electricity competition. For the VPP resource request, NV Energy stated that intervenors could address the matter during an upcoming Integrated Resource Plan proceeding.
In its final order, the commission largely sided with NV Energy. It declined to permit compensation assignment, mandate open data sharing, or require the inclusion of a VPP resource type in the next IRP, citing “insufficient information to determine whether a VPP is a viable resource option for Nevada.” Commission spokesperson Peter Kostes declined to comment beyond the order’s text in an email, though he noted the proceeding remains open until this week’s deadline for filing reconsideration requests. NV Energy did not respond to a request for comment.
Brian Turner, senior director at Advanced Energy United, told Utility Dive that while his organization was “very supportive of [the commission] going to this grid services tariff and transforming to a pay-for-performance grid services structure,” the ruling will curtail customer choice and could hinder behind-the-meter battery adoption in a state with relatively high residential solar penetration. “Nevada is one of the sunniest states in the country, and it has pretty good solar deployment, but very low [battery] attachment rates … there’s huge potential to add batteries to the system to get that attachment rate up and get dispatchable capacity into neighborhoods where it’s needed,” Turner said.
Assignability is especially critical for behind-the-meter battery adoption following the expiration of the federal investment tax credit for customer-owned residential batteries at the end of 2025, Turner said. Third-party providers that own and operate customer-sited storage systems have stepped in to maintain affordability, leveraging revenue from utility and market programs. Third-party aggregators also tend to be more reliable program participants than individual customers, as they pool more distributed capacity than required to meet obligations. This creates a buffer when customers opt out, Turner added.
He pointed to Xcel Energy’s Colorado subsidiary, another vertically integrated utility in a Western market, which recently proposed an aggregator-based tariff for its Aggregated Virtual Power Plant program. “They did so because it gave them more certainty and visibility into the performance of the portfolio overall,” Turner said.