Arizona Forecast: Rate Cases on the Horizon

Arizona is ground zero for the national net metering debate with five separate utility proposals to the Arizona Corporation Commission to make changes to the successful crediting program for rooftop solar. Clean energy advocates (including Vote Solar) argued that changes to utility net metering rates for rooftop solar should be considered within a full rate proceeding not handled in these one-off, single-issue attacks.  And it looks like that’s what we’ll get.

Prompted by an Administrative Law Judge (ALJ) recommendation on June 10 that Tucson Electric Power’s (TEP) proposal should be included in a full rate case, a domino effect of utility net metering application withdrawals has started. Shortly after the ALJ recommendation, TEP withdrew their motion and opted instead to file their proposed net metering changes as part of their full rate case. Trico filed a notice to withdraw their application on July 6, and Sulphur Springs Valley Electric Coop (SSVEC) is rumored to be following suit.

We thank Arizona Corporation Commission staff for not pursuing attacks on solar through single issue ratemaking.  So what’s next?  Rate cases, and lots of them. The way utilities structure their electric rates has a huge impact on solar’s return on investment. We argue that rate design should not discriminate against solar customers and in fact should preserve customers’ right to produce their own power and to save through energy efficiency measures (see our Rate Design Guiding Principles for more).

Vote Solar is currently involved in the UNS Electric rate case, and we have plans to get involved in the TEP rate case later this year. Trico’s recent filing indicates they will file their rate case as early as October 2015.   We’re still waiting on final decisions by APS and SSVEC, but one thing is certain: Arizona will be keeping our rates team plenty busy this year.