Environment & Energy Report

Apple Seeks Nevada Solar Power as State Weighs Energy Future

Nov. 17, 2017, 2:37 PM

Northern Nevada may soon get a boost in solar power projects, driven by companies like Apple that are looking for renewable energy as they expand in the state.

NV Energy, Nevada’s primary electric provider, is asking regulators to approve three agreements to purchase solar energy from proposed developments. Together, they would add 100 megawatts to the capacity of more than a dozen solar projects already approved or operating, mostly in the southern part of the state.

The power company, though, must prove that the long-term contracts make sense as the state’s energy market faces an uncertain future. Voters approved a measure last year ending NV Energy’s monopoly and must pass it again in 2018 to change the state’s constitution.

Balancing Test

For now, an NV Energy program for large companies is one of the few ways major consumers can use more renewable resources. An agreement with Apple, which regulators will first consider next month, would use it to secure solar power from the biggest of the proposed projects.

Representatives of Nevada’s Public Utilities Commission declined to comment to Bloomberg Environment on the proposed agreements. Commissioners must weigh public interest with treating utilities fairly, Hayley Williamson, assistant general counsel, told Bloomberg Environment.

If approved, Apple would use 50 megawatts from the Turquoise Solar facility to serve its expanding data center near Reno. The solar project, slated for a tech park in the area, would be the largest in northern Nevada, according to developers.

NV Energy is proposing the other two solar purchase agreements to serve customers in both northern and southern Nevada. The state mandates that the company have 20 percent renewable energy in its portfolio.

Apple Backs Renewable Energy

The Turquoise solar project would add to Apple’s existing clean power resources in Nevada. All Apple data centers, which process tasks like FaceTime calls and song downloads, run on renewable energy, according to the company.

That includes partnering on solar facilities in North Carolina, California, and Arizona, among other states, according to a 2017 environmental progress report from Apple. Its largest solar array so far is under development near Las Vegas, through a 200-megawatt agreement with NV Energy.

An Apple spokeswoman didn’t respond to additional questions from Bloomberg Environment.

In northern Nevada, Turquoise developers Estuary Capital Advisors and Sumitomo Corporation of Americas saw potential where big tech companies are moving in, Estuary President and Founder Jill Daniel said. The project’s 560 acres at the Reno Technology Park are near Tesla’s “gigafactory” for battery production and the Apple data center.

“We saw it as an underserved market,” Daniel told Bloomberg Environment.

Apple expects its energy output near Reno to more than double in the next few years as its data center expands, according to filings with the utility commission. A proposal shows an additional 10-megawatt phase of the Turquoise project will go to Liberty Utilities in California.

Developers are waiting for approval on that purchase agreement before breaking ground, Daniel said.

For Apple, the commitment to renewable energy goes beyond buying it, Kristina Raspe, Apple’s senior director of worldwide real estate and development, told Nevada regulators in a letter.

The company looks to “create or facilitate the creation of innovative renewable energy resources” where it locates, the letter said.

Nevada Weighs Deregulation

NV Energy must continue its resource planning even if the electricity market fundamentally changes, company leaders said in utility filings. An NV Energy spokesman directed questions from Bloomberg Environment to those documents.

For customers like Apple, that means securing solar power, the filings said. While most users receive a mix of energy types, the NV GreenEnergy Rider program lets major consumers use more renewable energy or related credits by paying a slightly higher rate.

Nevada regulators approve the long-term agreements to ensure the cost isn’t subsidized by other consumers. Renewable energy costs about one-third of a cent per kilowatt hour more under the program than the typical rate, according to NV Energy.

Expanding renewable options is one push behind the state’s upcoming energy choice vote. If passed, the retail market must open by 2023, with details to be determined by the state Legislature.

Casino companies, including Sheldon Adelson’s Las Vegas Sands Corp., have cited the need for clean and affordable energy when backing the measure. NV Energy, owned by Berkshire Hathaway Energy, has been neutral but raised questions about how to deregulate the industry.

A committee convened by Nevada Gov. Brian Sandoval (R) is looking at those issues, such as how NV Energy would divest of dozens of long-term contracts.

For new contracts, utility commissioners should consider how the terms would impact future divestment or transfers, said Jon Wellinghoff, CEO of Grid Policy, Inc. and policy adviser for the Nevada Energy Choice Initiative.

“We want to ensure the cost of doing that is as small as possible to Nevadans,” he told Bloomberg Environment.

To contact the reporter on this story: Brenna Goth in Phoenix at bgoth@bna.com

To contact the editor on this story: Rachael Daigle at rdaigle@bna.com

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