Arizona Public Service (APS), Arizona’s largest utility filed a proposal that would raise residential rates by 7.96 percent, significantly reduce the rate it offers for new rooftop solar customers and institute a demand charge.
It’s the utility’s biggest rate hike proposal in years and biggest effort to curb rooftop solar to date—even though it attributed only a fraction of the proposed hike to rooftop solar. It’s not it’s most recent effort to curb rooftop solar in the sun-drenched state either. Last year it tried to impose a significant service charge hike specifically on rooftop solar customers but ended that attempt.
The proposal, which would raise $3.6 billion for the utility, has drawn the ire of solar advocates and others in the state. "The loss of net metering in Arizona would mean the loss of thousands of jobs and consumer choice. Arizona will take a giant step backwards in transforming its energy future if this proposal is approved,” contended Kris Mayes, of the Energy Freedom Coalition of America (EFCA). Mayes is a former member of the Arizona Corporation Commission, the entity to which APS made its regulatory filing.
The utility said that it currently has 40,000 customers with rooftop solar power and that paying for rooftop solar net-metering requires the utility to raise rates by 1.25 percent even though 96 percent of its customers don’t have solar power. It said that existing customers and those that complete an application for rooftop solar by July 1, 2017, would be grandfathered into the existing net-metering system.
The utility also said that it wants to offer residential customers a change in volumetric pricing and institute demand charges for residential customers to help them reduce the impact of the rate increase.
“These new rate options would give customers more ability to control their energy bills by taking a few simple actions,” said APS CEO Don Brandt. “We already have 120,000 customers on demand-based rates—it’s our fastest-growing rate plan because it works for customers.”
However Mayes contended that “Demand charges are a dangerous plan that will force customers to constantly monitor their energy use out of fear of exorbitant charges. They especially penalize customers who have made substantial investments to reduce energy and contribute to more resilient Arizona energy future."
"This effort by APS to impose demand charges poses a serious setback to the ability of all Arizonans to produce their own power," said Dru Bacon, co-chair of Conservative Alliance for Solar Energy (CASE). "We call on the Commission to reject this anti-competitive plan."
APS has filed studies with the commission showing the impact of rooftop solar and why it wants to increase rates dramatically. But it’s interesting to note that in neighboring California the grid operator and one of the state’s leading utilities recently canceled 13 energy infrastructure projects, saving its customers $192 million because of rooftop and distributed solar power in it’s grid.Tweet