Shine On: APS Withdraws Rate Increase Proposal

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The hits keep coming for net-metering opponents. Last week, the utility Arizona Public Service (APS) withdrew its proposed net metering increase. Instead, the utility has requested that the Arizona Corporation Commission (ACC) launch a report to study the value of solar.

The utility asked for the ACC to reach a decision by March 2016 so the results could be included in the next APS rate case proposal. The report would focus on both the true cost of solar to APS and its customers. This would include the impact of solar on the grid.

As reported in the Arizona Daily Sun, APS said in a statement, “We hope our proposal will provide an alternative for the ACC to move forward with a much-needed discussion about how to update electricity pricing to reflect energy innovations like rooftop solar, battery storage and home energy management systems.”

History

In the spring, APS requested a rate increase from 70 cents per kilowatt to $3.00 per kilowatt. For most customers, this would amount to an increase from $5.00 per month to $21.00 per month.

This figure is not arbitrary. In 2013, the ACC considered approving the $21.00 rate, but agreed to the solar industry’s request for a lower rate at that time. They reserved the right to increase the rate in the future.

APS was hoping that this might be their time. However, earlier this year, the ACC ruled that Tuscon Electric Power (TEP) needed to wait to increase any solar fees until their next full rate case. Shortly thereafter, Trico Electric Cooperative (TEC) also withdrew their request for a solar increase, stating that they, too, would wait until their full rate case. However, over the objections of the solar industry and an administrative law judge, the commission agreed to hear the APS case.

Allegations of Conflict of Interest

As the battle raged on between solar advocates and APS, information came to light about some members of the commission. Allegations of a conflict of interest for three of the five members caused solar industry advocates and two former members of the ACC to call for their recusal from the case and an investigation.

Commissioners Tom Forese and Doug Little have been accused of accepting what is known as dark money. This is money that comes from sources that are not required to disclose their donors. Some of this money was alleged to come from APS.

Commissioner Bob Stump’s conflict stems from his remarks made on social media and in media outlets that net metering is a subsidy.  Solar advocates maintain that these comments demonstrate his bias.

As Arizona Central reports, Hugh Hallman, who filed the motions for recusal, said, “He’s already concluded before any evidentiary hearing that net metering is a subsidy.”

“The specific issue is whether or not there is a cost of service from distributed generation solar panels to non-solar-panel using ratepayers,” Hallman said. “APS seeks to create a discreet examination precisely because they want to eliminate the cost of other generation and benefits of solar panels.”

Future of Arizona Net Metering

For now, the state net metering cases appear to be in a holding period. The utilities will unveil their solar net metering proposals with their full rate increase filings.

This could mean only a temporary reprieve for solar customers. However, other states that have made similar decisions have learned that their customers actually benefit from the solar systems that tie into the grids.

While no-one can predict what the future holds for Arizona solar customers, this victory for solar is worth celebrating.