NV Energy proposes Wildfire Self-Insurance Policy | Local News

NV Energy has submitted a proposal to the Public Utilities Commission of Nevada (PUCN) to establish a Wildfire Self-Insurance Policy.

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A policy that NV Energy says aims to provide stability for its customers and mitigate financial impacts caused by catastrophic wildfires. 

NV Energy says it believes it is important to put advanced plans in place to ensure that there is also financial planning completed in the event of a catastrophic wildfire to protect its customers and have the ability to continue to provide electric service to the communities it serves.

A wildfire self-insurance policy is a financial strategy that utility companies use to fund the substantial expenses of catastrophic wildfires on communities and individuals.

NV Energy says the proposed fund will be built through additions to customer rates and a co-payment from shareholders and invested to grow over time. They say this approach ensures that 100 percent of the funds are available to support customers and the communities it serves in the event a covered catastrophic wildfire were to occur.

If approved, the self-insurance policy will be funded on a jurisdictional basis. Sierra customers in Northern Nevada, who face a higher risk of wildfires, will cover a larger portion of the costs compared to Nevada Power customers in Southern Nevada.

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NV Energy says the rate proposed for each region was determined using the same method previously approved by the PUCN for commercial wildfire insurance.

If approved as proposed, the average residential customer at Sierra Pacific Power will see their bill increase by about $2.40 per month, while an average residential customer at Nevada Power would see an increase of about $0.50 per month.

The policy as proposed would be collected over 10 years to avoid sudden rate increases, providing more stability and predictability for customers.

The policy will be reviewed and is subject to approval by the Commission.

To view the full filing on the PUCN website, click here.