Last week the board of Arizona’s Salt River Project (SRP), a nonprofit public utility, chose to impose draconian fees on customers with new solar installations—despite public protests. The utility will impose rate increases across all of its customers and impose additional grid maintenance fees on solar users.
Solar has become increasingly contentious in Arizona over the past few years as more residents have added solar to offset their electric bills. However, most of the ire has been cause by the state’s largest utility, APS, as it tried to reduce net-metering for its customers.
Under the newly approved price increases all of SRP’s electric customers will see a 3.3 percent increase in rates in April 2015, adding about $3.85 to customers’ monthly bills. Next year the rates will increase 3.9 percent from what it is now, increasing home electric bills by about $4.60.
New solar customers can expect a number of additional charges on their electric bill that are expected to increase their bills by about $50 a month—offsetting significant amounts of savings on the electric bill that they would expect to see through net metering.
Even before SRP approved the changes last week the solar industry fighting against the new rates. The Arizona Solar Center’s Jim Arwood, for instance, wrote that: “In three hearings over the past month it has become increasingly clear that SRP views the solar leasing industry as a thorn in its side--so much so that management is blaming its proposed new fees on the solar leasing industry itself, saying out loud in a public hearing: ‘The issue is solar leasing, not SRP.’”
SRP is grandfathering existing customers into their existing plans for up to 20 years and if a home with an existing solar panel system is sold it will remain grandfathered from the time of the original installation, according to SRP.
"SRP will continue to support solar energy by seeking low-cost alternatives that provide maximum financial and reliability benefits for all of our nearly 1 million customers," said Mark Bonsall, SRP's chief executive officer. "Grandfathering continues this support for our existing solar customers, but the new price plan ensures that the cost shift to our 985,000 non-solar customers will not grow."
Arwood contended that “Management’s proposed new price plan for solar doesn’t treat all solar electric customers the same: it treats lease customers more harshly than those that own their solar electric systems.” Those who own their systems are grandfathered for 20 years while those who lease a system are only grandfathered for 10 years.
“By penalizing rooftop solar lease owners in what amounts to a crippling blow to the leasing industry, SRP is inflicting collateral damage to the entire solar industry,” Arwood says. “The new rules will turn thousands of Arizona solar lease holders into victims with bad experiences with solar. The resulting black-eye will taint all solar for years to come.”
The solar industry also is prepared to fight back. SolarCity CEO Lyndon Rive sent a letter to SRP President David Rousseau observing that the proposal alone significantly reduced applications for new residential solar installations in SRP’s service area.
Rive wrote: “The proposed price plan is unsupported and unsupportable, by any reasonable economic analysis. It is impossible to see the plan as anything but an effort to eliminate consumer choice offered by solar leasing companies, and maintain SRP’s monopoly power.”
Rive added that the company planned to file a suit against SRP if it made the changes it had proposed.Tweet