To strengthen its monopolistic position and wipe out rooftop solar, Arizona Public Service – Arizona’s largest electric utility, sent a proposal to the Arizona Corporation Commission requesting to either cut net metering payments by more than half, or add fees to rooftop solar customer’s bills. Net metering is the policy that gives rooftop solar customers fair credit for the excess energy they put back on the grid. Following a request by Commissioner Gary Pierce that ACC Staff analyze of the proposal, Commission staff filed a report on September 30 that rejects the APS proposal. The “Pierce Report” recommends that the net metering be addressed in the next rate case in 2016. The report also recognized the value inherent in distributed generation that APS’s proposal did not consider – such as avoided fuel costs and increased grid security, air quality.
To strengthen its monopolistic position and wipe out rooftop solar, Arizona Public Service – Arizona’s largest electric utility, sent a proposal to the Arizona Corporation Commission requesting to either cut net metering payments by more than half, or add fees to rooftop solar customer’s bills. Net metering is the policy that gives rooftop solar customers fair credit for the excess energy they put back on the grid. Following a request by Commissioner Gary Pierce that ACC Staff analyze of the proposal, Commission staff filed a report on September 30 that rejects the APS proposal. The “Pierce Report” recommends that the net metering be addressed in the next rate case in 2016. The report also recognized the value inherent in distributed generation that APS’s proposal did not consider – such as avoided fuel costs and increased grid security, air quality.
The report advised “that the Commission not approve either of the NM [Net Metering] cost-shift solutions proffered by APS in the instant application for the reasons discussed above. Instead, Staff recommends that no changes be made at this time, but instead, this issue be evaluated during APS’s next rate case."
Thirty thousand Arizona ratepayers have voiced their support of net metering, opposing APS.
With 500 new installations per month, rooftop solar is becoming an increasingly popular choice for the residents of Arizona. There are currently about 18,000 solar customers in the state (up from 900 in 2009), and the growing industry provides 10,000 jobs for installers, technicians, and electricians throughout the state.
So why is APS trying to put a stop to the growth of rooftop solar?
Rooftop solar is competing with APS, and it's the only major form of competition left now that deregulation has been overruled. A ruling took place recently that sided against deregulation and further secured APS’s position as a monopoly utility provider in Arizona. APS is trying to eliminate its only source of competition by proposing to slash net metering. Such an aggressive policy reversal would essentially put an end to the rooftop solar industry’s success in the state, while allowing APS to enjoy their monopoly status.
APS is justifying its position with false accusations that rooftop solar customers are unfairly pushing grid access costs onto ratepayers that do not have solar. The truth is that rooftop solar subsidizes the utility. A recent study in Arizona shows that APS customers save $34 million annually thanks to many factors including savings on expensive and dirty conventional power plants and the reduced need for transmission and distribution investments. The cost estimates cited by APS fail to take into account the savings in fuel, transmission, and infrastructure that rooftop solar customers are helping the utility and non-solar ratepayers to avoid. In addition, they do not incorporate societal impacts like benefits to public health and the environment, as well as, local job growth and increased local economic activity that generates tax revenue for state and local governments.
I’m optimistic that the Commission will stand by its ratepayers and its own analysis rather than succumbing to pressure from a utility over which it has regulatory authority.