SolarCity announced plans Wednesday to cease operations in Nevada after regulators drastically cut benefits for retail solar owners.
The rooftop solar giant, based in San Mateo, Calif., said in a statement that after bringing 2,000 jobs to Nevada since 2013, the state has all but killed the retail solar industry in favor of the utility industry.
"This is a very difficult decision, but Gov. Sandoval and his PUC leave us no choice," Lyndon Rive, SolarCity's chief executive, said in a statement. "The people of Nevada have consistently chosen solar, but yesterday their state government decided to end customer choice, damage the state's economy and jeopardize thousands of jobs.
In an unanimous vote Tuesday, the Nevada Public Utilities Commission increased the fixed charge for residential and small commercial solar owners while lowering compensation for electricity they generate and send to the power grid. The commission in a press release said the move was designed to address "inequities."
Utility companies argue that retail solar owners do not pay their fair share for power lines, substations and other costs related to maintaining the grid.
GreenTech Media, a research and analysis firm in Boston, said the full effect of the change in Nevada rules for net metering are unclear, but the proposed plan by NV Energy would amount to a $40 monthly fee for most solar customers, who typically save $11 to $15 per month on their electricity bills.
Last week, the California Public Utilities Commission released its proposed changes to the state's net metering rules. California's proposal largely keeps the state's current benefits intact. But changes still could be made to the proposal before a final vote Jan. 28.
Bernadette Del Chiaro, executive director of the California Solar Energy Industries Assn., said decisions such as Nevada's prevent solar from making economic sense for consumers.
"If you don't have good net metering, you don't have a market," Del Chiaro said.
SolarCity said the retail solar industry helped Nevada become No. 1 in the nation in solar jobs per capita in 2014. The company said regulators' decision would harm 12,000 existing solar customers, including schools, with "exorbitant fees" in what appears to be an attempt to protect the profits of the state's largest utility.
"The PUC has protected NV Energy's monopoly, and everyone else will lose," SolarCity's Rive said. "We have no alternative but to cease Nevada sales and installations, but we will fight this flawed decision on behalf of our Nevada customers and employees."