SB 417 — Revises provisions relating to public utilities. (BDR 58-1106)

“Natural gas utility” means a public utility whichwhichication. purchases natural gas for resale.

purchases natural gas for resale.

(a) Establish the alternative rate-making mechanisms that may be included in such a plan and any limitations on such alternative rate-making mechanisms as the Commission deems appropriate, including, without limitation, any restrictions on the types of alternative rate-making mechanisms that may be used in concert withinwit(b) Prescribe the sameinformation that must be included in an alternative rate-making plan.plan and an application submitted in accordance with the regulations adopted pursuant to this section.

(b)(c) PrescribeSpecify the informationcircumstances thatunder mustwhich bea includednatural ingas utility for which the Commission has approved an alternative rate-makingrate- making plan andis anrequired to file a general rate application submittedpursuant into accordanceNRS with704.110, including, without limitation, if the regulationsalternative adoptedrate-making plan ceases to meet the criteria established by the - 83rd Session (2025) – 4 – Commission pursuant to thisparagraph section.(g) or after any period of time established by regulation of the Commission.

(c)(d) SpecifyProvide a process to educate customers of a natural gas utility regarding the circumstancesavailable underalternative whichrate-making mechanisms tha(e) Establish requirements for a natural gas utility for which the Commission has approved an alternative rate-rate-making making plan is required to filekeep aor generalcause rateto applicationbe pursuantkept toany NRSinformation 704.110,and including,records withoutwhich limitation,the ifnatural thegas alternativeutility rate-makingwould planhave ceasesbeen required to meetsubmit to the criteriaCommission establishedas bypart theof Commissionan application filed pursuant to paragraphNRS (g)704.110 or after704.185, anyif periodthe filing of timeany establishedsuch byapplication regulationis ofdelayed or excused pursuant to the Commission.alternative rate-making plan.

(d) Provide a process to educate customers of a natural gas utility regarding the available alternative rate-making mechanisms that may be included in an alternative rate-making plan.

(e) Establish requirements for a natural gas utility for which the Commission has approved an alternative rate-making plan to keep or cause to be kept any information and records which the - *SB417_R1* – 4 – natural gas utility would have been required to submit to the Commission as part of an application filed pursuant to NRS 704.110 or 704.185, if the filing of any such application is delayed or excused pursuant to the alternative rate-making plan.

(1) Provides for just and reasonable rates that are comparablecompar(2) toEnsures ratesthat establishedcustomers pursuantof toa NRSnatural 704.110;gas utility benefit from lower regulatory administrative costs where appropriate;

and(3) (2)Aligns Ensuresan thateconomically customersviable of a natural gas utility benefitmodel fromwith lowerstate regulatorypublic administrativepolicy costsgoals; where appropriate.

(4) Enables the delivery of natural gas service and options for service and pricing that customers of a natural gas utility value, including, without limitation, the development and use of low carbon fuels by customers that prioritize such an option over other factors, including price;

(5) Fosters statewide improvements to the economic and operational efficiency of the natural gas infrastructure system;

(6) Furthers the public interest, including, without limitation, the promotion of safe, economic, efficient and reliable service to all customers of the natural gas utility;

- 83rd Session (2025) – 5 – (7) Enhances the resilience and security of the natural gas infrastructure system while addressing concerns relating to customer privacy;

(8) Facilitates the research and development of innovative natura(9) Balances the interests of customers and shareholders by providing services customers want while preserving reasonable shareholder value.

TheIn Commissionaddition mayto adoptany regulationsrequirement toadopted establishby oneregulation orof morethe methodsCommission pursuant to establishsubsection 1, if a formulanatural gas utility files an application for aan alternative rate-making plan that includes formula rate.rates or a multi-year rate plan, the alternative rate-making plan must include, without limitation:

Such(a) methodsAn mayearnings-sharing include,mechanism; without limitation:

(a)and The(b) recoveryA ofdiscussion identifying any changes in risk to the costsnatural ofgas utility and a capitalcalculation expenditureto incurredadjust bythe rate of return of the natural gas utility,utility asbased adjustedon forthe anychanges accumulatedin depreciation,risk deferredto taxes,the propertynatural taxesgas andutility, anywhich othermust costsdemonstrate establishedthe byimpact of the Commission;changes on the rates charged to customers of the natural gas utility.

or (b) An annual attrition adjustment based on the Consumer Price Index published by the United States Department of Labor and approved by the Commission for the purposes of the alternative rate-making plan.

Except as otherwise provided in subsection 3 of section 11 of this act and in accordance with the regulations adopted by the Commission pursuant to section 11 of this act, not earlier than the date on which the Commission first adoptsadoptsct, not regulations pursuant to section 11 of this act, a natural gas utility may apply to the Commission to establish an alternative rate-rate-making - *SB417_R1* – 5 – making plan which sets forth the alternative rate-making mechanisms to be used to establish rates during the time period covered by the plan.

The Commission shall approve, with or without modifications, or deny an application submitted pursuant to - 83rd Session (2025) – 6 – subsection 1 not later than 210 days after the Commission receives a copy of the application unless the Commission, upon good cause, extends by not more than 90 days the time to act upon the application.

If the Commission fails to act upon an application withinbe thedeemed timeto providedbe denied.d by this subsection, the application shall be4. deemed to be denied.

4.The Commission shall conduct a consumer session pursuant to NRS 704.069 in each major geographic area in which the natural gas utility provides services to solicit comments from the public before taking action on an application submitted pursuant to subsection 1.

Except as otherwise provided in this subsection, the Commission shall conduct at least one consumer session pursuant to NRS 704.069 to solicit comments from the public before taking action on an application submitted pursuant to subsection 1.

If a natural gas utility provides services in more than one major geographic area in this State, the Commission shall conduct at least one consumer session in the county with the largest population for each major geographic area in which the natural gas utility provides services before taking action on an application.

As used in this subsection, “major geographic area” means any geographic area in this State that includes a county whose population is 52,000 or more.

- *SB417_R1* – 6 – 6.

(a) An earnings-sharing mechanism that balances the interests of customers that purchase natural gas for consumption in thisthists State and the shareholders of the natural gas utility;

If the Commission approves an application for an alternative rate-making plan that authorizes the recovery of the costs of a capital expenditureexpenditure: pursuant to the regulations adopted pursuant to subsection 2 of section 11 of this act, the natural gas utility must prove that the capital expenditure was prudent at the time the natural gas utility files a general rate application pursuant to NRS 704.110 or at any time established by regulation of the Commission.

(a) The natural gas utility must prove that the capital expenditure was prudent at the time the natural gas utility files a general rate application pursuant to NRS 704.110 or at any time established by regulation of the Commission;

and (b) If the Commission determines during a general rate case proceeding conducted pursuant to NRS 704.110 that the natural gas utility did not prove that the capital expenditure was prudent, - 83rd Session (2025) – 7 – customers of the natural gas utility the amount previouslyfund the recovered through charges to customers of the natural gas utility for the costs of the capital expenditure.

(a) If a general rate application was filed at the same time as the application for the alternative rate-making plan and the general rate application or any portion thereof was approved, the rates approved in the general rate application shall be deemed in effect.approved, the rates that were in effect before the portion of then is general rate application was approved by the Commission remain in effect for any portion of the general rate application not approved by the Commission until changed or modified by the Commission.

To the extent that a portion of a general rate application is approved, the rates that were in effect before the portion of the general rate application was approved by the Commission remain in effect for any portion of the general rate application not approved by the Commission until changed or modified by the Commission.

The Commission may at any time, upon its own motion or after receiving a complaint from any customer, the Consumer’s Advocate or the Regulatory Operations Staff of the Commission, investigate any of the rates, tolls, charges, rules, regulations, practices and services relating to the alternative rate-making plan, - *SB417_R1* – 7 – and, after a full hearing as provided in NRS 704.120, by order, make such changes as may be just and reasonable to the samesameder, extent as authorized by NRS 704.120.

Except as otherwise provided in NRS 704.075, 704.68861 to 704.68887, inclusive, 704.7865 and 704.7867, or as may- otherwise83rd beSession provided(2025) by– the8 Commission– pursuant to NRS 704.095, 704.097 or 704.7621 [:] or section 12 of this act:

(b) A public utility shall adjust its rates on a quarterly basis between annual rate adjustment applications pursuant to subsection 8 of NRS 704.110 based on changes in the public utility’s recorded costs of natural gas purchased for resale.

(c) An electric utility shall, between annual deferred energy accounting adjustment applications filed pursuant to NRS 704.187, adjust its rates on a quarterly basis pursuant to subsection 10 of NRS(d) A public utility shall post copies of all proposed schedules and all new or amended schedules in the same offices and in substantially the same form, manner and places as required by NRS 704.110.704.070 for the posting of copies of schedules that are currently in force.

(d) A public utility shall post copies of all proposed schedules and all new or amended schedules in the same offices and in substantially the same form, manner and places as required by NRS 704.070 for the posting of copies of schedules that are currently in force.

(f) Except as otherwise provided in paragraph (g), if the proposed change in any schedule does not change any rate or will result in an increase in annual gross operating revenue in an amount that doesdo(1) notThe exceedpublic $15,000:utility may file the proposed change with the Commission using a letter of advice in lieu of filing an application;

- *SB417_R1* – 8 – (1) The public utility may file the proposed change with the Commission using a letter of advice in lieu of filing an application;

 A letter of advice filed pursuant to this paragraph must include a certification by the attorney for the public utility or an affidavit by an authorized representative of the public utility that to the best of the signatory’s knowledge, information and belief, formed after a reasonable- inquiry,83rd theSession proposed(2025) change– in9 schedule– does not change any rate or result in an increase in the annual gross operating revenue of the public utility in an amount that exceeds $15,000.

(I) Includes with the letter of advice a certification by the attorney for the small-scale provider of last resort or an affidavit by an authorized representative of the small-scale provider of last resort that to the best of the signatory’s knowledge, information and belief, formed after a reasonable inquiry, the proposed change in schedule does not change any rate or result in an increase in the annual gross operatingamount revenuethat ofexceeds the$50,000 small-scaleor provider10 ofpercent, lastwhichever resortis inless;in an amount(II) Demonstrates that exceedsthe $50,000proposed change in schedule is required by or 10directly percent,related whicheverto isa less;regulation or order of the Federal Communications Commission;

(II) Demonstrates that the proposed change in schedule is required by or directly related to a regulation or order of the Federal Communications Commission;

 Not later than 10 business days after the filing of a letter of advice pursuant to subparagraph (1), the Regulatory Operations Staff of the Commission or any other interested party may file with the Commission a request that the Commission order an applicant to file a general rate application in accordance with subsection 3 of NRSa 704.110.request.0.

The Commission may hold a hearing to consider such a(h) request.In making the determination pursuant to paragraph (f) or (g), the Commission shall first consider all timely written protests, any presentation that the Regulatory Operations Staff of the Commission may desire to present, the application of the public utility and any other matters deemed relevant by the Commission.

- *SB417_R1* – 9 – (h) In making the determination pursuant to paragraph (f) or (g), the Commission shall first consider all timely written protests, any presentation that the Regulatory Operations Staff of the Commission may desire to present, the application of the public utility and any other matters deemed relevant by the Commission.

An applicant that is a small-scale provider of last resort may submit to the Commission a written request for a waiver of the 5- year period specified in sub-subparagraph (III) of subparagraph (1) - 83rd Session (2025) – 10 – of paragraph (g) of subsection 1.

The Commission may approve the request if the applicant provides proof satisfactory to the Commission that the applicant is not earning more than the rate of return authorized by the Commission and that it is in the public interest for thetheized by Commission to grant the request for a waiver.

If the Commission approves a request for a waiver submitted pursuant to this subsection, the applicant shall file the letter of advice pursuant to subparagraph (1) of paragraph (g) of subsection 1 not earlier than 120 days after the date on which the applicant submitted the request for a waiver pursuant to this subsection, unless the order issued by the Commission approving the request for a waiver specifies a different period for the filing of the letter of advice.

If a public utility files with the Commission an application to make changes in any schedule, including, without limitation, changes that will result in a discontinuance, modification or restriction of service, the Commission shall investigate the propriety of the proposed changes to determine whether to approve or disapprove the proposed changes.

Except as otherwise provided in subsection 3, if a public utility files with the Commission an application to make changes in any schedule, the Commission shall, not later than 210 days after the - *SB417_R1* – 10 – date on which the application is filed, issue a written order approving or disapproving, in whole or in part, the proposed changes.

If a public utility files with the Commission a general rate application, the public utility shall submit with its application a statement showing the recorded results of revenues, expenses, investments- and83rd costsSession (2025) – 11 – which data were available when the application was prepared.hs for Except as otherwise provided in subsection 4, in determining whether to approve or disapprove any increased rates, the Commission shall consider evidence in support of capitalthe increased rates based upon actual recorded results of operations for itsthe mostsame recentmonths, 12adjusted monthsfor increased revenues, any increased investment in facilities, increased expenses for depreciation, certain other operating expenses as approved by the Commission and changes in the costs of securities which dataare wereknown availableand whenare measurable with reasonable accuracy at the applicationtime wasof prepared.filing and which will become effective within 6 months after the last month of those months, but the public utility shall not place into effect any increased rates until the changes have been experienced and certified by the public utility to the Commission and the Commission has approved the increased rates.

ExceptThe as otherwise provided in subsection 4, in determining whether to approve or disapprove any increased rates, the Commission shall also consider evidence insupporting support of the increased rates based upon actual recorded results of operations for the same 12 months, adjusted for increased revenues, any increased investment in facilities, increased expenses for depreciation, certain other operating expenses as approved by the Commission and changes in the costs of securities which are known and are measurable with reasonable accuracy at the time of filing and which will become effective within 6 months after the last month of those 12 months, but the public utilityutility’s shallplant notplaced place into effectservice anyduring increased rates until the changesrecorded haveteste beenperiod experiencedor and certified by the publicperiod utilityfor tocertification theas Commissionset andforth thein Commission has approved the increasedapplication. rates.

The Commission shall also consider evidence supporting expenses for depreciation, calculated on an annual basis, applicable to major components of the public utility’s plant placed into service during the recorded test period or the period for certification as set forth in the application.

and (2) At least once every 36 months thereafter or on a date specifiedCommission inpursuant anto alternativeNRS rate-making704.7621.ing plan approved by the Commission(b) pursuantAn toelectric NRSutility 704.7621.that primarily serves densely populated counties shall file a general rate application:

(b) An electric utility that primarily serves densely populated counties shall file a general rate application:

and - *SB417_R1* – 11 – (2) At least once every 36 months thereafter or on a date specified in an alternative rate-making plan approved by the Commission pursuant to NRS 704.7621.

(c)- A83rd publicSession utility(2025) that– furnishes12 water– for municipal, industrial or domestic purposes or services for the disposal of sewage, or both,both,l which had an annual gross operating revenue of $2,000,000 or more for at least 1 year during the immediately preceding 3 years and which had not filed a general rate application with the Commission on or after July 1, 2005, shall file a general rate application on or before June 30, 2008, and at least once every 36 months thereafter unless waived by the Commission pursuant to standards adopted by regulation of the Commission.

(d) A public utility that furnishes water for municipal, industrial or domestic purposes or services for the disposal of sewage, or both, which had an annual gross operating revenue of $2,000,000 or more for at least 1 year during the immediately preceding 3 years and which had filed a general rate application with the Commission on or after July 1, 2005, shall file a general rate application on or before June 30, 2009, and at least once every 36 months thereafter unless waived by the Commission pursuant to standards adopted by regulation of the Commission.

In addition to submitting the statement required pursuant to subsection 3, a public utility may submit with its general rate application a statement showing the effects, on an annualized basis, of all expected changes in circumstances.

If such a statement isissis, filed, it must include all increases and decreases in revenue and expenses which may occur within 210 days after the date on which its general rate application is filed with the Commission if such expected changes in circumstances are reasonably known and are measurable with reasonable accuracy.

If a public utility submits such a statement, the public utility has the burden of proving that the expected changes in circumstances set forth in the statement are - *SB417_R1* – 12 – reasonably known and are measurable with reasonable accuracy.

The- Commission83rd shallSession consider(2025) expected– changes13 in– circumstances to be reasonably known and measurable with reasonable accuracy if the expected changes in circumstances consist of specific and identifiable events or programs rather than general trends, patterns or developments, have an objectively high probability of occurring to the degree, in the amount and at the time expected, are primarily measurable by recorded or verifiable revenues and expenses and are easily and objectively calculated, with the calculation of the expected changes relying only secondarily on estimates, forecasts, projections or budgets.

(a) The Commission shall consider the statement submitted pursuant to this subsection and evidence relevant to the statement, including all reasonable projected or forecasted offsets in revenue and expenses that are directly attributable to or associated with the expected changes in circumstances under consideration, in addition to the statement required pursuant to subsection 3 as evidence in establishingest(b) justThe andpublic reasonableutility ratesis fornot required to file with the publicCommission utility;the certification that would otherwise be required pursuant to subsection 3.

and (b) The public utility is not required to file with the Commission the certification that would otherwise be required pursuant to subsection 3.

If a public utility files with the Commission a general rate application, the public utility, or a public utility affiliated with the public utility through common ownership, shall not file with the Commission another general rate application until all pending general rate applications filed by that public utility have been decided by the Commission unless, after application and hearing, the Commission determines that a substantial financial emergency would exist if the public utility or its affiliate is not permitted to file another general rate application sooner.

The provisions of thisthistted to file subsection do not prohibit a public utility from filing with the Commission, while a general rate application is pending, an application to recover the increased cost of purchased fuel, purchased power, or natural gas purchased for resale pursuant to subsection 7, a quarterly rate adjustment pursuant to subsection 8 or 10, any information relating to deferred accounting requirements pursuant to NRS 704.185 or an annual deferred energy accounting adjustment- application83rd pursuantSession to(2025) NRS– 704.187,14 if– the public utility is otherwise authorized to so file by those provisions.provisions.public utility 7.

- *SB417_R1* – 13 – 7.

A public utility which purchases natural gas for resale and which adjusts its rates on a quarterly basis may request approval from the Commission to make quarterly adjustmentsCommission toshall itsapprove deferredor energydeny accountingsuch adjustment.a request not later than 120 days after the application is filed with the Commission.

The Commission shall approve or deny such a request not later than 120 days after the application is filed with the Commission.

(a) The public utility shall file written notice with the Commission before the public utility makes a quarterly rateratee adjustment.

The public utility shall begin- providing83rd suchSession written(2025) notice– to15 its– customers not later than 30 days after the date on which the public utility files its written notice with the Commission pursuant to paragraph (a).

- *SB417_R1* – 14 – (1) Must be printed separately, if included with the customer’s regular monthly bill, or the subject line of the electronic transmission must indicate that notice of a quarterly rate adjustment is included, if provided by electronic transmission pursuant to NRS 704.188;

(III) A statement that customers may send written comments or protests regarding the rate adjustment to the Commission;

protests regarding the rate adjustment to the (IV) A statement that the transactions and recorded costs of natural gas which are the basis for any quarterly rate adjustment will be reviewed for reasonableness and prudence in the next proceeding held by the Commission to review the annual rate adjustment application pursuant to paragraph (d);

(d) The proceeding regarding the annual rate adjustment application must include a review of each quarterly rate adjustment and the transactions and recorded costs of natural gas included in eachThere quarterlyis filingno andpresumption theof annualreasonableness rateor adjustmentprudence application.for anyion.

There is no presumption of reasonableness or prudence for any quarterly rate adjustment or for any transactions or recorded costs of natural gas included in any quarterly rate adjustment or the annual rate adjustment application, and the public utility has the burden of proving reasonableness and prudence in the proceeding.

(e) The Commission shall not allow the public utility to recover any recorded costs of natural gas which were the result of any practice or transaction that was unreasonable or was undertaken, managed or performed imprudently by the public utility, and the Commission- shall83rd orderSession the(2025) public– utility16 to– adjust its rates if the Commission determines that any recorded costs of natural gasgass if the included in any quarterly rate adjustment or the annual rate adjustment application were not reasonable or prudent.

An electric utility shall adjust its rates on a quarterly basis based on changes in the electric utility’s recorded costs of purchased - *SB417_R1* – 15 – fuel or purchased power.

If the Commission approves a request to make quarterly adjustments to the deferred energy accounting adjustment of an electric utility pursuant to this subsection, any quarterly adjustment to the deferred energy accounting adjustment must not exceed 0.25 utility’s deferred account varies by less than 5 percent from thectric electric utility’s annual recorded costs for purchased fuel or purchased power which are used to calculate quarterly rate adjustments, the deferred energy accounting adjustment must be set to zero cents per kilowatt-hour of electricity.

If the balance of the electric utility’s deferred account varies by less than 5 percent from the electric utility’s annual recorded costs for purchased fuel or purchased power which are used to calculate quarterly rate adjustments, the deferred energy accounting adjustment must be set to zero cents per kilowatt-hour of electricity.

The first quarterly adjustment to a deferred energy accounting adjustment must be made pursuant to an order issued by the Commission approving the application of an electric utility to make quarterly adjustments to its deferred energy accountingaccountingity to adjustment.

The electric utility shall begin providing- such83rd writtenSession notice(2025) to– its17 customers– not later than 30 days after the date on which the electric utility files a written notice with the Commission pursuant to paragraph (a).

(1) Must be printed separately, if included with the customer’s regular monthly bill, or the subject line of the electronic transmission must indicate that notice of a quarterly rate adjustment - *SB417_R1* – 16 – is included, if provided by electronic transmission pursuant to NRS 704.188;

(III) A statement that customers may send written comments or protests regarding the rate adjustment to the Commission;

protests regarding the rate adjustment to the (IV) A statement that the transactions and recorded costs of purchased fuel or purchased power which are the basis for any quarterly rate adjustment will be reviewed for reasonableness and prudence in the next proceeding held by the Commission to review the annual deferred energy accounting adjustment application pursuant to paragraph (d);

(d) The proceeding regarding the annual deferred energy accounting adjustment application must include a review of each quarterly rate adjustment and the transactions and recorded costs of purchased fuel and purchased power included in each quarterly filing and the annual deferred energy accounting adjustment application.

(e)- The83rd CommissionSession shall(2025) not– allow18 the– electric utility to recover any recorded costs of purchased fuel and purchased power whichwhichrecover were the result of any practice or transaction that was unreasonable or was undertaken, managed or performed imprudently by the electric utility, and the Commission shall order the electric utility to adjust its rates if the Commission determines that any recorded costs of purchased fuel and purchased power included in any quarterly rate adjustment or the annual deferred energy accounting adjustment application were not reasonable or prudent.

- *SB417_R1* – 17 – 12.

and (b) Supplement its general rate application with the same information,rate ifapplication.uch such information was not submitted with the general rate13. application.

13.

For the purposes of this subsection, a plan or an amendment to a plan shall be deemed to be accepted by the Commission only as to that portion of the plan or amendment accepted as filed or modified with the consentcon14. of the utility pursuant to NRS 704.751.

14.

and (b)- Authorize83rd aSession utility(2025) to– implement19 a– reduced rate for low- income residential customers.

implement a reduced rate for low- 15.

A public utility which purchases natural gas for resale or an electric utility that makes quarterly adjustments to its deferred energy accounting adjustment pursuant to subsection 8 or 10 may submit to the Commission for approval an application to discontinue making quarterly adjustments to its deferred energy accounting - *SB417_R1* – 18 – adjustment and to subsequently make annual adjustments to its deferred energy accounting adjustment.

(a) “Deferred energy accounting adjustment” means the rate of a public utility which purchases natural gas for resale or an electric utility that is calculated by dividing the balance of a deferred account during a specified period by the total therms or kilowatt- hours which have been sold in the geographical area to which the rate applies during the specified period, not including kilowatt-hours sold pursuant to an expanded solar access program established pursuant to NRS 704.7865.

(b) “Electric utility” has the meaning ascribed to it in NRS 704.187.

(c) “Electric utility that primarily serves densely populated counties” means an electric utility that, with regard to the provision of electric service, derives more of its annual gross operating revenue in this State from customers located in counties whose population is 700,000 or more than it does from customers located in (d) “Electric utility that primarily serves less densely populated counties” means an electric utility that, with regard to the provision of electric service, derives more of its annual gross operating revenue in this State from customers located in counties whose population is less than 700,000 than it does from customers located in counties whose population is 700,000 or more.

Sec.

16.

NRS 704.762 is hereby amended to read as follows:

704.762 1.

The Commission shall adopt regulations to establish procedures for an electric utility to apply to the - 83rd Session (2025) – 20 – The regulations must:proval of an alternative rate-making plan.

(a) Establish the alternative rate-making mechanisms that may be included in such a plan and any limitations on such alternative rate-making mechanisms as the Commission deems appropriate, including, without limitation, any restrictions on the types of alternative rate-making mechanisms that may be used in concert within the same alternative rate-making plan.

(b) Provide the information that must be included in an alternative rate-making plan and an application submitted pursuant to the regulations adopted pursuant to this section.

(c) Specify the circumstances under which an electric utility for which the Commission has approved an alternative rate-making plan is required to file a general rate application pursuant to NRS 704.110 including, without limitation, if the alternative rate-making plan ceases to meet the criteria established by the Commission pursuant to paragraph (g).

regarding the available alternative rate-making mechanisms thatility may be included in an alternative rate-making plan.

(e) Establish requirements for an electric utility for which the Commission has approved an alternative rate-making plan to keep or cause to be kept any information and records which the utility would have been required to submit to the Commission as part of an application pursuant to NRS 704.110 or 704.187, if the filing of any such application is delayed or excused pursuant to the alternative rate-making plan.

(f) If the Commission determines that it is practicable, require an electric utility to include in its application for the approval of an alternative rate-making plan:

(1) One or more cost of service studies.

(2) An analysis estimating and comparing:

(I) The rates that would be charged and the revenue that in the application;

andr the alternative rate-making plan proposed (II) The rates that would be charged and the revenue that would be collected pursuant to the rate-making process established by NRS 704.110.

(g) Establish criteria for the evaluation of an alternative rate- making plan which may include, without limitation, whether the plan:

(1) Aligns an economically viable utility model with state public policy goals.

- 83rd Session (2025) – 21 – to rates established pursuant to NRS 704.110.tes that are comparable (3) Enables the delivery of electric service and options for services and pricing that customers value including, without limitation, the development and the use of renewable resources by customers that prioritize such resources above other factors, including price.

(4) Fosters statewide improvements to the economic and operational efficiency of the electrical grid.

(5) Furthers the public interest including, without limitation, the promotion of safe, economic, efficient and reliable electric service to all customers of the electric utility.

(6) Enhances the resilience and security of the electrical grid while addressing concerns regarding customer privacy.

(7) Ensures that customers of an electric utility benefit from lower regulatory administrative costs where appropriate.

(8) Facilitates the research and development of innovative electr(9) Balances the interests of customers and shareholders by providing for services that customers want while preserving reasonable shareholder value.

2.

In addition to any requirement adopted by regulation of the Commission pursuant to subsection 1, if an electric utility files an application for an alternative rate-making plan that includes formula rates or a multi-year rate plan, the alternative rate- making plan must include, without limitation:

(a) An earnings-sharing mechanism;

and (b) A discussion identifying any changes in risk to the electric utility and a calculation to adjust the rate of return of the electric utility based on the changes in risk to the electric utility, which must demonstrate the impact of the changes on the rates charged to customers of the electric utility.

3.

The Commission is not required to accept applications to determines, after a reasonable investigation, that the use of an alternative rate-making plan is not consistent with the criteria established by the Commission pursuant to paragraph (g) of subsection 1.

Sec.

NRS 704.7621 is hereby amended to read as follows:

704.7621 1.

Except as otherwise provided in subsection [2] 3 of NRS 704.762, and in accordance with the regulations adopted by the Commission pursuant to NRS 704.762:

- 83rd Session (2025) – 22 – (a) Not sooner than the first Monday in January 2020, an electric utility that primarily serves less densely populated counties may apply to the Commission to establish an alternative rate-making plan which sets forth the alternative rate-making mechanisms to be used to (b) Not sooner than the first Monday in January 2021, anan.

electric utility that primarily serves densely populated counties may apply to the Commission to establish an alternative rate-making plan which sets forth the alternative rate-making mechanisms to be used to establish rates during the time period covered by the plan.

2.

The Commission shall approve, with or without modifications, or deny an application submitted pursuant to subsection 1 not later than 210 days after the Commission receives a copy of the application unless the Commission, upon good cause, extends by not more than 90 days the time to act upon the application.

If the Commission fails to act upon an application within the time provided by this subsection, the application shall be deemed to be denied.

3.

The Commission shall conduct at least one consumer session pursuant to NRS 704.069 to solicit comments from the public before taking action on an application submitted pursuant to subsection 1.

4.

The Commission shall not approve an application submitted pursuant to subsection 1 unless the Commission determines that the plan:

(a) Is in the public interest;

(b) Results in just and reasonable rates, as determined by the Commission;

(d) Satisfies the criteria established by the Commission pursuantty;

to paragraph (g) of subsection 1 of NRS 704.762;

(e) Specifies the time period to which the plan applies;

and (f) Includes a plan for educating the customers of the electric utility regarding the alternative rate-making mechanisms included in the plan.

5.

An alternative rate-making plan may include, without limitation:

(a) An earnings-sharing mechanism that balances the interests of customers that purchase electricity for consumption in this State and the shareholders of the electric utility.

(b) A term or condition waiving the requirement that the electric utility file a general rate application every 36 months pursuant to subsection 3 of NRS 704.110 or extending beyond 36 months the time between required general rate application filings.

- 83rd Session (2025) – 23 – (c) Any other term or condition proposed by an electric utility or any party participating in the proceeding or that the Commission finds is reasonable and serves the public interest.

6.

If the Commission approves an application for an costs of a capital expenditure:at authorizes the recovery of the (a) The electric utility must prove that the capital expenditure was prudent at the time the electric utility files a general rate application pursuant to NRS 704.110 or at any time established by regulation of the Commission;

and (b) If the Commission determines during a general rate case proceeding conducted pursuant to NRS 704.110 that the electric utility did not prove that the capital expenditure was prudent, the Commission shall require the electric utility to refund the customers of the electric utility the amount previously recovered through charges to customers of the electric utility for the costs of the capital expenditure.

7.

The Commission may at any time, upon its own motion or after receiving a complaint from any customer, the Consumer’s Advocate or the Regulatory Operations Staff of the Commission, investigate any of the rates, tolls, charges, rules, regulations, practices and service relating to an alternative rate-making plan, and, after a full hearing as provided in NRS 704.120, by order, make such changes as may be just and reasonable to the same extent as authorized by NRS 704.120.

[7.] 8.

(a) “Deferred“Electric energy accounting adjustment” means the rate of a public utility whichthat purchasesprimarily naturalserves gasdensely forpopulated resalecou(b) or“Electric an electric utility that isprimarily calculatedserves byless dividingdensely thepopulated balancecounties” ofhas a deferred account during a specified period by the totalmeaning thermsascribed orto kilowatt-it hours which have been sold in the geographical area to which the sold pursuant to an expanded solar access program establishedatt-hours pursuant to NRS 704.7865.704.110.

(b)~~~~~ “Electric25 utility”- has83rd theSession meaning(2025) ascribed to it in NRS 704.187.

(c) “Electric utility that primarily serves densely populated counties” means an electric utility that, with regard to the provision of electric service, derives more of its annual gross operating revenue in this State from customers located in counties whose population is 700,000 or more than it does from customers located in counties whose population is less than 700,000.

(d) “Electric utility that primarily serves less densely populated counties” means an electric utility that, with regard to the provision of electric service, derives more of its annual gross operating revenue in this State from customers located in counties whose population is less than 700,000 than it does from customers located in counties whose population is 700,000 or more.

H - *SB417_R1*