Arizona Corporation Commission
1200 W. Washington Street
Phoenix, AZ 85007-2996
 
RE: Resource Planning and Procurement in 2021, 2022, and 2023 (Docket No. E-99999A-22-0046) and In the Matter of Resource Planning and Procurement in 2019, 2020, and 2021 (Docket No. E-00000V-19-0034)
 
Chairman O’Connor and Commissioners,

At the February 2022 Open Meeting, scheduled for February 8th and 9th, 2022, the Commission voted to acknowledge the 2020 Integrated Resource Plans (IRPs) of Tucson Electric Power (TEP) and Arizona Public Service (APS).[1] In addition to acknowledging the IRPs, the Commission placed numerous other requirements on the utilities, including a requirement to provide stakeholders and Commission Staff with the requisite tools to meaningfully participate in the subsequent modeling process.

IT IS FURTHER ORDERED that Arizona Public Service Company, Tucson Electric Power Company, and UNS Electric, Inc. shall in future Integrated Resource Plans negotiate a project-based licensing fee that permits up to 12 Resource Planning Advisory Council members and Staff the ability to perform their own modeling runs in the same software package as these load serving entities, and to provide all necessary data and support to fully utilize the models. The load serving entities shall absorb the cost of the licensing fees.[2]

To date, nearly 15 months after this vote, neither utility has complied with the Order. Stakeholders have been requesting access since Q4 2022. Stakeholders are still waiting on Nondisclosure Agreements (NDAs) from TEP and were told by APS that training on the software would occur in April 2023. Only the utilities have the ability to execute NDAs, provide the licenses and data, and conduct the requisite training. Without these tools, stakeholders are unable to meaningfully participate in the manner desired by Order 78499.

We ask the Commission to direct both TEP and APS to provide all of the above mentioned tools no later than May 31, 2023. Additionally, because of this lengthy delay, we ask for the IRP filing deadline to be extended past August 1, 2023. That is simply not enough time to conduct modeling and provide meaningful feedback on the results. Finally, we ask that the Commission take this issue up as soon as possible, at either the May 2nd Open Meeting or the May 11th Contingency Meeting, because the June Open Meeting is too close to the IRP deadline to permit resolution of these issues with sufficient time to carry out the analysis envisioned in the Commission’s Order.

Respectfully,

Autumn T. Johnson
Executive Director
Arizona Solar Energy Industries Association (AriSEIA)
520-240-4757
autumn@ariseia.org

[1] Open Meeting Notice, Docketed February 3, 2022, Agenda Item 26, available here: https://docket.images.azcc.gov/0000205866.pdf?i=1682712327380.

[2] Decision No. 78499, Docketed March 2, 2022, Page 14, Lines 9-14, available here: https://docket.images.azcc.gov/0000206081.pdf?i=1682710289643.

Arizona Corporation Commission
1200 W. Washington Street
Phoenix, AZ 85007

RE: Joint Comments in the request of Tucson Electric Power Company for approval of the PPFAC rate adjustment, Docket No. E-01933A-19-0028

Dear Chairman O’Connor and Members of the Arizona Corporation Commission, 

Vote Solar, the Southwest Energy Efficiency Project (SWEEP), and the Arizona Solar Energy Industries Association (AriSEIA) appreciate the opportunity to provide these comments on Commission Staff’s Recommended Opinion and Order (ROO) regarding Tucson Electric Power’s (TEP) request to increase the Purchased Power and Fuel Adjustment Clause (PPFAC). If approved by the Commission, TEP’s proposal would increase the average residential bill by $13.11 (10.8%) on top of the previously approved PPFAC, which was $6.36 (5.1%). The Staff’s proposal would increase the average residential bill by $12.07, plus the existing $6.36, for a total impact of $18.43 per month. 

The volatile nature of natural gas costs is an important reminder that the Commission should consider all tools at its disposal to mitigate significant increases to customer utility bills via fuel adjustors. After all, TEP’s request equates to a $19.47 monthly charge for the average residential customer. Notably, greater investment in reliable, affordable energy efficiency and renewable energy are vital solutions to insulate customers from this price shock and volatility. At the Energy Reliability Summit and Summer 2023 Energy Preparedness special open meeting, several commissioners reinforced the importance of demand response in maintaining reliability. Tools like demand response can also save costs for individual customers and the grid. 

Further, energy efficiency is well documented to cost less than other alternatives, including gas resources. During times of upward utility bill pressure, TEP’s energy efficiency offerings are especially vital because they can help residents and businesses control their energy costs, drive down energy bills, and redirect savings to the local economy. Additionally, renewable energy, such as wind and solar, offers a price-stable alternative because it has no fuel costs. However, the current structure of fuel adjustors passes 100% of fuel costs on to customers, significantly reducing the utilities’ incentive to make every effort to mitigate increasing costs. Utilities must consider fuel and other operations and maintenance costs when making resource procurement decisions because customers pay for the totality of those costs, not just capital costs. 

A Bring Your Own Device (BYOD) program is another option to reduce customer exposure to  volatile fuel prices. Dispatch of customer-sited batteries, when demand is high, reduces the need for utilities to purchase more expensive peak power. As a result, customer-sited solutions like a BYOD program benefit the grid while reducing reliance on fuel adjustors.
​
In conclusion, the current structure of the PPFAC creates significant exposure to fuel price volatility that results in variable and unpredictable customer bills. Accordingly, the Commission should examine the structure of fuel adjustors like the PPFAC to determine if the reinstatement of a cost-sharing provision to protect ratepayers from skyrocketing fuel costs is warranted. We believe this examination should occur in the Company’s current pending rate case or through a separate proceeding before the following PPFAC rate period proposal is filed. 
We appreciate your consideration of these comments and ongoing efforts to protect Arizona ratepayers.

Respectfully,
​
Kate Bowman
Interior West Regulatory Director
Vote Solar 
kbowman@votesolar.org 

Caryn Potter
Arizona Representative
SWEEP
cpotter@swenergy.org

Autumn Johnson
Executive Director
AriSEIA
autumn@ariseia.org

Arizona Corporation Commission
1200 W. Washington Street
Phoenix, AZ 85007
 
Re: Support for Approval of Revisions to Rate Schedule E-32 L SP, Docket No. E-01345A-22-0281
 
Chairman O’Connor and Commissioners,
 
Vote Solar and the Arizona Solar Energy Industries Association (AriSEIA) are supportive of the Arizona Public Service (APS) Company’s Application for the approval of revisions to rate schedule E-32 L SP and encourage the Commission to approve this rate.
 
APS’ proposed revisions are pursuant to Decision No. 78317 (November 9, 2021), which directed APS to engage in a collaborative with interested stakeholders to explore possible improvements to E-32 L SP (Large General Service Storage Pilot).[1] Following a series of collaborative meetings that took place from February to October 2022, APS has proposed revenue-neutral design changes that improve upon the Large General Service Storage Pilot rate.

The Large General Service Storage Pilot rate is a pilot rate available to large commercial customers who choose to adopt energy storage systems. The purpose of E-32 L SP is to promote the economic dispatch of customer-sited energy storage systems in a manner that aligns with high peak load. To date, no customers have chosen to take service on E-32 L SP. APS’ revisions to the rate include higher energy charges during all hours and months of the year, and significantly higher energy charges during summer on-peak periods between 4:00 and 9:00 PM. Demand charges have been reduced commensurately, resulting in a rate design that is overall revenue-neutral. 
 
APS’ revisions address a flaw in the current E-32 L SP by increasing the emphasis on volumetric energy rates. As a result, the revised Large General Service Storage Pilot will provide greater investment certainty for commercial customers. Demand charges present operational challenges for customers seeking to reduce their energy bills because they are calculated based on the customers’ highest 15-minute period of energy usage throughout the month. A customer who proactively dispatches their energy storage system during all but a single 15-minute period of the month will pay a demand charge equal to what they would have paid had they not adopted energy storage at all. Demand charges can penalize customers who adopt energy efficient technology, especially new and unfamiliar technology, because it is challenging to forecast savings and there is significant risk that small changes in operation of the energy storage system could threaten forecasted savings. In contrast, emphasis on volumetric rates gives customers the opportunity to save money on their utility bill in a manner that is proportional to the benefit they are providing through dispatch of energy storage during times of peak load. APS’ proposed revisions - particularly the increases in the summer on-peak energy rate from 6.5 cents per kilowatt-hour to 17.6 cents per kilowatt-hour - maintains a strong price differential that will encourage the dispatch of customer-sited storage during periods of high load in the summer.
 
We recommend one additional change to the E-32 L SP tariff. While the current tariff defines the on-peak period as 4:00 to 7:00 PM on weekdays, the revised tariff re-defines the on-peak period as 4:00 to 9:00 PM every day. We recommend narrowing the on-peak window to weekdays, as this better aligns with the hours when APS is most likely to experience high customer load and normal hours of business operations. The Commission could direct APS to evaluate this change as part of their current rate case in Docket No. E-01345A-22-0144. We do not wish this evaluation to delay approval of the revised tariff at the May 2 Open Meeting.
 
Arizona is poised to lead on the adoption of distributed battery storage through the development of rates that encourage economically efficient adoption of customer-sited batteries. Increased adoption of customer-sited batteries gives utilities an additional tool to flexibly and cost-effectively meet their customers’ energy needs and can provide significant cost and grid resilience benefits for all ratepayers. We appreciate APS’ efforts to work with stakeholders to improve the E-32 L SP tariff. We urge the Commission to approve APS’ Application today and consider whether changes to the on-peak hours are warranted through evaluation as part of APS’ rate case.
 
Thank you for your consideration of this important matter.
 
Respectfully,
 
Kate Bowman
Interior West Regulatory Director
Vote Solar
kbowman@votesolar.org
703-674-8637

Autumn Johnson
Executive Director
AriSEIA
autumn@ariseia.org
520-240-4757

[1] Decision No. 78317, November 9, 2021, page 441 lines 15 - 21.