AriSEIA Submits Letter to ACC In Opposition to Elimination of EE and DSM Rules

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Arizona Corporation Commission
1200 W. Washington Street
Phoenix, AZ 85007
 
RE: Opposition to Repeal of the Electric Energy Efficiency Standards Rules in Docket No. RE-00000A-24-0025
 
Dear Chairman and Commissioners:
 
The Arizona Solar Energy Industries Association (AriSEIA) respectfully submits these comments in opposition to the wholesale repeal of the electric energy efficiency standards rules in the above-referenced docket. At the very least, please preserve the sections of the rule that pertain to filing Demand Side Management (DSM) plans R14-2-2405 through R14-2-2410, as well as any other provisions that Hearing Division deems necessary to DSM plan submission and approval.
 
Arizona is experiencing significant load growth and has repeatedly set new system peak records.[1] In this environment, demand side management programs are more critical than ever. Energy efficiency and demand side management resources provide cost-effective capacity, reduce reliance on volatile wholesale markets, and enhance reliability during times of peak demand. Arizona Public Service (APS) alone meets 14% of demand from DSM program, that is equal to the share of coal in their portfolio and exceeds the amount of utility scale renewables on their system.[2] APS has more than 2 GW of DSM on their system.[3] Eliminating the framework that enables these programs would increase costs for ratepayers and threaten grid stability.
 
We are particularly concerned about the proposed repeal of R14-2-2405 and the immediately following sections. These provisions are where utilities currently house their demand side management plans, including their virtual power plant (VPP) programs. The Commission has already twice voted to uphold these programs as valuable and cost-effective resources. These programs deliver capacity for less than market purchases and help utilities manage peak load reliably.
 
The Commission itself ordered the APS VPP pilot program in Docket No. E-01345A-22-0144, following review in a contested rate case and a year-long dedicated stakeholder process. The second year of funding for that program is now included in APS’s pending DSM plan in Docket No. E-01345A-23-0088. Repealing the DSM rule sections that house these plans could undermine the ability of the Commission and stakeholders to continue building on programs that have already been vetted and approved.
 
Energy efficiency and demand side management programs are not abstract policy ideas. They are in operation today, they are working, and they are providing measurable value to Arizona utilities and ratepayers. They save money, improve reliability, and ensure that Arizona can meet the challenges of rapid growth.
 
For these reasons, AriSEIA urges the Commission to reject the wholesale proposed repeal of the electric energy efficiency standards rules. Preserving at least portions of these rules, especially the DSM provisions, is essential to maintaining affordable, reliable, and resilient power for Arizona families and businesses.
 
Thank you for your consideration.
  
Respectfully,
 
/s/ Autumn T. Johnson
Executive Director
AriSEIA 
(520) 240-4757
[email protected]

[1] Arizona Corporation Commission, Arizona Electric Utilities Set Record High Demand Again; Demand Soars Above Original Forecasts for 2025, August 8, 2025, available here https://azcc.gov/news/home/2025/08/09/arizona-electric-utilities-set-record-high-demand--again--demand-soars-above-original-forecasts-for-2025.

[2] Arizona Public Service, Form 10-K 2024, December 31, 2024, p.5,  available here https://s22.q4cdn.com/464697698/files/doc_financials/2024/ar/PNW-2024-12-31-10-K.pdf.

[3] Arizona Public Service, 2023 Integrated Resource Plan, November 2023, p.26, available here https://www.aps.com/-/media/APS/APSCOM-PDFs/About/Our-Company/Doing-business-with-us/Resource-Planning-and-Management/APS_IRP_2023_PUBLIC.pdf?la=en&hash=F601897086C6836F7FD33C5C2F295F47.