Press Release: Arizona Corporation Commission Decision on Solar Step Down
ACC Narrowly Decides to Maintain Compensation for Solar Customers
The ACC Voted on a 10% Solar Step down and May Consider a Complete Rewrite of the Value of Solar
Phoenix, Arizona — Yesterday, on Thursday, August 24th, 2023, the Arizona Corporation Commission (ACC) voted on a critical decision concerning equitable compensation for solar customers across the state. The Commission approved a 10% reduction in the Resource Comparison Proxy (RCP), which forms the bedrock of compensation for solar customers who contribute surplus energy to the grid.
The Commission first considered a more dramatic step down of 40% to 50%, which was met with disapproval by solar, energy, and economic justice advocates. The Commission ultimately chose to keep the precedent established by a lengthy value of solar proceeding completed in 2017, which requires that the value of the RCP step down at most 10% annually.
The RCP remains available to Arizona families interested in going solar for now. However, the ACC expressed interest in revisiting Arizona’s solar compensation foundations entirely. Additionally, before its October 11th meeting, the ACC invited the public to provide input about whether the ACC should reopen its 2017 decision regarding the RCP rate.
“Arizona families and businesses are facing rising energy prices, inflation, and high electricity bills following a summer of record-breaking heat. Rooftop solar is a solution to help consumers take control of their energy costs, and any reductions to the RCP undermine the affordability of solar energy and hinder the expansion of solar adoption in the state,” said Kate Bowman, Interior West Regulatory Director for Vote Solar.
Vote Solar, a nonprofit advocating for equitable access to solar energy, filed comments underscoring the origins and administration of the RCP rate, ongoing economic challenges that jeopardize energy affordability, and the potential negative economic consequences of a decline in the RCP value. Vote Solar’s comments note that utilities have not filed transparent, publically available data to support their RCP calculations. The RCP values put forth by utilities for 2023 have not undergone transparent scrutiny, potentially leading to unfavorable customer outcomes. Vote Solar concluded their comments with a recommendation that the Commission adhere to Decision 75859’s principles by maintaining the RCP step down at no more than 10% annually.
Vote Solar emphasized the principle of gradualism in ratemaking, allowing regulators to move customer rates towards the cost of service incrementally while promoting stability and avoiding rate shock that harms customers by upsetting household or business budgets.
The comments also highlighted the detrimental impact of the immediate amendments, the impact on customers’ financial planning, and the precedent the decision sets to undermine regulatory certainty in Arizona. Consumers and businesses rely on Commission decisions to make important decisions about their budgets and future investments, and dismantling the measured transition approach that the Commission initially championed creates destabilizing uncertainty.
“The stability provided by the RCP is the fundamental reason solar has continued to thrive in Arizona. Stable, predictable rates give solar companies and consumers certainty about the future and the confidence to invest in their homes and businesses,” said Bowman.
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FOR IMMEDIATE RELEASE
Date: August 25, 2023
Contact: Emerald Sage, Vote Solar, esage@votesolar.org