AriSEIA Files Comments on the Impact of the Court of Appeals GAC Decision on the Pending APS Rate Case

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The Arizona Court of Appeals recently vacated the solar-specific charges adopted in APS's 2022 rate case, concluding that they were imposed without providing customers and stakeholders the due process required under Arizona law.
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While the Court did not decide whether the Grid Access Charge (GAC) and Legacy Solar Rate Increase (LSRI) are substantively lawful, its decision reinforces what AriSEIA has consistently argued throughout the current APS rate case: APS has failed to demonstrate that residential solar customers impose unique costs that justify discriminatory solar-specific charges.

In response to the Court's decision, AriSEIA has recommended that the Arizona Corporation Commission:

• Reject any proposal to increase the GAC or LSRI in the current APS rate case.
• Eliminate both charges based on the existing evidentiary record.
• Decline to reopen the record or create a second phase to give APS another opportunity to justify the charges.
• Reserve only the question of potential customer refunds until the appellate process is complete, if necessary.

APS has argued that the Court's decision should have little impact on the current rate case. AriSEIA agrees that this case should be decided on its own evidentiary record. The difference is that AriSEIA believes the record demonstrates that the solar charges should be eliminated, not increased.

The evidence presented in this case shows that APS has again failed to identify unique costs associated with serving residential solar customers. APS's own witnesses acknowledged that resource adequacy planning is conducted on a system-wide basis for the benefit of all customers, not solely rooftop solar customers. AriSEIA witness Kevin Lucas also identified significant methodological flaws in APS's site-load Cost of Service Study, demonstrating that it does not provide a reliable basis for discriminatory solar-specific charges.

APS has also requested that, if necessary, the Commission postpone deciding the future of the solar charges by creating a second phase of the rate case. AriSEIA opposes that request. APS filed this rate case knowing the Court of Appeals challenge was pending and chose the evidence and methodology it presented. The Commission already has the evidence necessary to decide the issue, and delaying resolution would unnecessarily prolong the case while giving APS another opportunity to justify charges it has not supported.
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AriSEIA will continue advocating for fair, evidence-based ratemaking and equal treatment of Arizona's rooftop solar customers throughout the remainder of the APS rate case.