​FOR IMMEDIATE RELEASE
 
Contact:
Autumn Johnson
(520) 240-4757
[email protected]
 
Phoenix, AZ – Arizona Public Service (APS) is once again advocating for a tax on all solar customers in its service territory. APS seeks a fee increase that amounts to a tax on APS’ nearly 200,000 solar customers where they pay 15% more than all other residential customers. The Arizona Corporation Commission (ACC) recently ruled that this solar tax increase was enacted without proper public notice and deprived parties of due process and ordered a rehearing to fix these important constitutional issues.
 
The Arizona Solar Energy Industries Association (AriSEIA) has opposed this discriminatory solar tax that raises costs for families all over Arizona.  AriSEIA asked the ACC to reconsider the APS rate case to evaluate the fairness of this fee and cure due process deficiencies. The ACC granted AriSEIA’s rehearing request, but APS has since fought to exclude approximately 74,000 solar customers on “Legacy Rates” from the rehearing and has fought to limit the evidence the ACC can even consider in determining if the fee is legal. Today the ACC issued a decision siding with APS on these two issues. This decision means that there will not be a fair hearing on this new solar tax and that hundreds of thousands of Arizonans that invested their hard-earned money in solar will not be treated fairly.
 
“APS has proven time and again that they will always take whatever actions they can to try and penalize solar customers,” said Autumn Johnson, Executive Director of AriSEIA. “APS fights against rooftop solar for one reason: money. When customers exercise their right to install solar, APS has less justification to build new powerplants that they earn a profit on. Solar customers use their own money to add energy to the grid and reduce peak energy demand, saving all customers money. And these customers increasingly also install batteries that provide APS with power at the exact moment they need it most. Yet, APS, time and again, seeks to hurt solar customers at every opportunity.”
 
The ACC is conducting another hearing in November about these new APS-backed solar taxes that only impact solar customers. It is unclear from the decision today whether or not that hearing will resolve any of the legal concerns of AriSEIA or solar customers, which led to the request for a rehearing in the first place. More information can be found in Docket No. E-01345A-22-0144.
 
About AriSEIA: The Arizona Solar Energy Industries Association (AriSEIA) is the State’s leading trade association dedicated to promoting the adoption of solar, storage, and electrification technologies. AriSEIA advocates for policies that support the growth of Arizona’s solar industry and provides resources and education to ensure that solar energy continues to thrive in the State.
 

ACC Staff filed a unusual motion this week seeking to arbitrarily restrict the scope of the APS rate case rehearing for no legitimate reason. AriSEIA filed again explaining that the reasons for rehearing apply to all not just some solar customers and that without the cost of service study, you would have absolutely no basis to charge solar customers more than everyone else for the same thing. Therefore, all solar customers and the cost of service are part of the rehearing.

AriSEIA, along with the Attorney General's Office, Western Resource Advocates, and the Sierra Club, filed an Application for Rehearing today in the Unisource Electric (UNSE) Certificate of Environmental Compatibility (CEC) case. In this case, UNSE asked the ACC to "disclaim jurisdiction" over essentially all new gas plants in the State. The Line Siting Committee voted against them 9-2 after a two day hearing, but the ACC voted along party lines to overturn that decision. AriSEIA asked for rehearing, which is a necessary next step to appeal.

Arizona Corporation Commission
1200 W. Washington Street
Phoenix, AZ 85007
 
RE: Docket No. E-01575A-23-0299
 
Chairman, Commissioners, Staff, and Sulphur Springs,
 
AriSEIA was not aware of this docket until recently and we understand that the Company intends to raise this issue in its forthcoming rate case application. However, we want to make it clear that an export rate (in this case the DGEE) below avoided cost is a violation of federal law. The Company’s filing makes it clear that its avoided cost is $.0629 and its current DGEE rate is $.041310.[1] The Company then filed for a withdrawal of the proposed tariff seeking to rectify this discrepancy one day later stating, “[a]fter working with ACC Staff we learned that the last approved export rate year can remain in effect multiple years until SSVEC filed for an update.”[2]
 
The Public Utility Regulatory Policies Act (PURPA) was enacted by Congress in 1978 for the primary purpose “to lessen the country's dependence on foreign oil” and to encourage the development of renewable energy technologies as alternatives to fossil fuel.[3] The Federal Energy Regulatory Commission (FERC) develops rules to implement PURPA. PURPA achieves its purpose by requiring electric utilities to purchase energy and capacity from qualifying facilities (QFs).[4] Those rates are set at avoided cost. The utility's avoided cost is the “incremental cost to an electric utility of electric energy or capacity or both which, but for the purchase from the [QF]…, such utility would generate itself or purchase from another source.”[5] The avoided cost rate must be just and reasonable, in the public interest, and nondiscriminatory against QFs.[6] PURPA prohibits utilities from engaging in price discrimination when they borrow supplemental power from or to small energy producers.[7] Congress enacted PURPA to “overcome obstacles imposed by [] utility monopolies for non-utility generation, including customer-sited small renewable generation.”[8] Qualifying small power producers includes residential customers with rooftop solar.[9]

Importantly, the courts have determined that QFs are entitled to key protections against discriminatory rates and charges. “For example, when a home or business with solar panels needs to buy extra power from or wants to sell surplus power to the local utility, PURPA bars the utility from charging that home or business different rates than it would any other customer or supplier.”[10] “Section 210(f) requires state public utility commissions and nonregulated independent utilities to ‘implement’ the rules issued by FERC under Section 210(a) by incorporating them into their regulations and procedures.”[11] 

The Commission’s decision as to the implementation of PURPA can be found in Docket No. 81-0045. The Commission last visited PURPA in Docket Nos. 17-0360, 16-0272, and 18-0087 in 2019.
 
While the Company intends to file a rate case sometime at the end of this year, that means solar customers have been underpaid for at least a year, depending on how long the rate case takes to resolve. AriSEIA believes this delay is in violation of PURPA and that it was inappropriate to withdraw and then close this docket. AriSEIA respectfully requests that the Company include a proposal to rectify this situation in its 2024 rate case, including a mechanism to make these solar customers whole. AriSEIA also requests that future filings that make it clear the export rate is lower than avoided cost be resolved promptly.
 
Respectfully,
 
/s/ Autumn T. Johnson
Executive Director
AriSEIA 
(520) 240-4757
[email protected]

[1] Sulphur Springs Valley Electric Cooperative, Tariff Filing, Docket No. E-01575A-23, Filed November 6, 2023, available here https://docket.images.azcc.gov/E000032051.pdf?i=1720586124384.

[2] Sulphur Springs Valley Electric Cooperative, Tariff Filing Withdrawal, Docket No. E-01575A-23, Filed November 7, 2023, available here https://docket.images.azcc.gov/E000032051.pdf?i=1720586124384.

[3] FERC v. Mississippi, 456 U.S. 742, 745-46 (1982).

[4] 18 C.F.R. § 292.303.

[5] 18 C.F.R. § 292.101(b)(6).

[6] 18 C.F.R. 292.304(a)(1)(i)-(ii).

[7] 16 U.S.C. § 824a-3-(b).

[8] Petition for Enforcement Under the Public Utility Regulatory Policies Act of 1978 under EL24-54, Docket EL24-54-000, p. 2, filed January 12, 2024, available at https://elibrary.ferc.gov/eLibrary/filelist?accession_number=20240112-5029&optimized=false [hereinafter Vote Solar PURPA Petition]; Am. Paper Institute v. Am. Elec. Power Serv. Co., 461 U.S. 402, 405 (1983).

[9] 16 U.S.C. § 796(7)(A), (C), & (D). See also 18 C.F.R. §§ 293.203(a), 292.201(a)(1), (d)(1), 292.204(b)(1)(i); In re Westar, 460 P.3d 821, 824 (Kan. 2020); Sun Edison LLC, 129 FERC 61,146 at 18 (2009).

[10] Solar v. City of Farmington, 2 F.4th 1285, 1287 (10th Cir. 2021); 16 U.S.C. § 824a-3-(b).

[11] Id. at 1288.

Arizona Corporation Commission (ACC) Staff issued a second set of questions regarding the new Value of Solar docket. AriSEIA responded to the first set and submitted responses today to the second set. We continue to oppose any increase in the annual step down or any decrease in the 10-year lock in period.

The Arizona Corporation Commission (ACC) granted rehearing of the APS rate case because it surprise added a new fixed fee on solar customers that was never a part of the case in the final order. Since then, APS has been trying to narrow the scope of the rehearing, no matter how illogical. First, APS has tried to argue that only some solar customers are part of the rehearing, despite the fact the added charges apply to all solar customers. Then APS has tried to argue that the cost of service study upon which the charges are based is not part of the rehearing. AriSEIA has opposed both maneuvers. 

UNSE continues to call for a Motion to Dismiss on AriSEIA's complaint against them for violating Arizona's Line Siting statutes for nearly two decades. AriSEIA argues that position is premature given the likely rehearing or appeal on the underling disclaimer of jurisdiction docket.

The Arizona Corporation Commission sent AriSEIA a letter regarding our UNSE press release, requesting changes. AriSEIA filed the request along with a letter objecting to the inappropriate request in the docket and declined to make the requested changes.

The administrative law judge has imposed a stay on AriSEIA's complaint against UNSE pending the outcome of the UNSE CEC docket, which AriSEIA does not oppose at this time.

FOR IMMEDIATE RELEASE

Contact:
Autumn Johnson
(520) 240-4757
[email protected]

Phoenix, AZ - Today, the Arizona Corporation Commission (ACC) voted 4-1 along party lines to overturn the 9-2 decision of their own Arizona Power Plant and Line Siting Committee. The ACC's vote will eliminate environmental review of new gas plants in Arizona going forward. It reverses 53 years of consistent application of Arizona law regarding the siting of new thermal power plants.

UNE Electric (UNSE), the sister company of Tucson Electric Power (TEP), plans to add 200 MW of new gas at Black Mountain Generating Station in Mohave County. Plants greater than 100 MW are required to obtain a Certificate of Environmental Compatibility (CEC) from the Line Siting Committee. UNSE argued that A.R.S. 40-360(9) should be reinterpreted to only require a CEC for turbines that are greater than 100 MW, regardless of how many there are or the overall size of the plant. This loophole will now mean that no utilities in Arizona will need ACC review of any new gas (or nuclear) plants as long as the individual units are smaller than 100 MW.

"The ACC overturned their own Line Siting Committee and 53 years of legal precedent today to achieve the policy goal of making it as easy as possible to build more gas generation while simultaneously stating that the legislature should require additional regulation of renewables," said Autumn Johnson, Executive Director of the Arizona Solar Energy Industries Association (AriSEIA). "We had a 2 day hearing in front of an 11 member Committee and UNSE lost overwhelmingly because they did not prove their case. And yet, we can now expect that every utility in Arizona will start building new plants with no environmental review. This is a major setback for the clean energy transition."

The intervening parties have 20 days to ask for a rehearing before they can appeal to Superior Court. The full docket can be found here.

About AriSEIA

AriSEIA is the leading voice of the solar industry in Arizona, dedicated to advancing solar energy through advocacy, education, and collaboration. With a commitment to promoting sustainable energy solutions, AriSEIA serves as a catalyst for the growth and development of Arizona's solar industry.