Buffett's Win in Nevada Prompts SolarCity to Make First Job Cuts

  • `There won’t be any jobs to train people for' in Nevada
  • Nevada regulators approved new solar charges last month

SolarCity Corp. plans to eliminate more than 550 jobs in Nevada, most of its field workers in the state, after regulators approved new utility fees for solar rooftops.

The biggest U.S. rooftop solar provider will shift some employees to “business-friendly” states that don’t impose similar charges, San Mateo, California-based SolarCity said in a statement Wednesday.

This is the first significant cut in staffing for SolarCity, which has grown rapidly in recent years. Surging demand for rooftop power has generated friction between companies that install and operate the systems. and traditional utilities that see them as a threat to revenue.

Besides the job cuts, SolarCity closed a training facility near Las Vegas on Tuesday because “there won’t be any jobs to train people for,” Chandler Sherman, a spokeswoman, said in an interview.

SolarCity announced plans to stop sales and installation in Nevada on Dec. 23, a day after regulators approved changes to the state’s net-metering program, one of the main incentives for rooftop solar power. The company, which counts billionaire Elon Musk as its chairman and largest shareholder, has said the fees make solar power less attractive to consumers and will drive down demand.

Monthly Charges

As of Jan. 1, homes and offices that generate solar power are paying a higher monthly service fee and are receiving a smaller credit on their bills for electricity they feed to the local grid. Utilities have argued that the changes are needed to offset the loss of revenue as more customers produce their own energy.

Opponents of the fees plan to ask regulators Thursday for a stay on the policy, and the Nevada Public Utilities Commission is expected to discuss the issue at a Jan. 13 meeting.

Other solar companies may follow SolarCity’s lead, said Greg Butterfield, chief executive officer of Vivint Solar Inc., which opened two sales and installation offices in Las Vegas in July. (Vivint is being acquired by SunEdison Inc.)

‘Consumer Choice’

Nevada’s changes to its net-metering program “will costs jobs, economic output and consumer choice,” Butterfield said in a statement on Wednesday. “Were we and our competitors to proceed with operations in Nevada, customers would lose money.”

NV Energy, a unit of Warren Buffett’s Berkshire Hathaway Inc. that owns Nevada’s two biggest utilities, had sought the changes to recoup money that it says solar customers aren’t paying for grid operations. The company’s monthly fee for solar customers has jumped 40 percent to $17.90.

The job cuts represent “most” of SolarCity’s Nevada field workers, Sherman said. “We will keep some staff in the state to service existing customers.” The company has more than 15,000 employees, up from about 4,300 at the end of 2013.

Before it's here, it's on the Bloomberg Terminal. LEARN MORE