AZ Corporation Commission Keeps Solar Increase Proposal Alive

You may have read about it in the Arizona Republic.  Yesterday the ACC voted 3/2 on a proposal that gives Arizona Public Service (APS) another opportunity to increase the cost to future solar customers.  We have been keeping our eye on this one for some time.  Here's what you need to know.

Background:

APS charges solar customers additional fees on top of standard service charges to offset some of the revenue they lose when people go solar.  That Lost Fixed Cost Recovery (LFCR) charge is currently about $5 for a solar customer.  The APS proposal would have increased that to about $21 each month for new solar customers (existing customers would be grandfathered).  APS adjusts their LFCR each January and is due to submit a rate case in 2016 for all customers. This proposal would "thread the needle" between these two existing mechanisms for changing what customers pay.

What Happpened:

The case went before the Administrative Law Judge, who reviewed all testimony and issued a Recommended Opinion and Order (ROO) for the Commission to vote on.  The ROO cited that the offset to non-solar customers from existing solar customers was about 21 cents per customer per month, not enough to justify a change at this time.  The ALJ recommended the request from APS be dismissed and that APS include it in their next rate case. 

The ACC then votes on the issue.  They can vote the ROO up or down as is, or they can modify it.  In this case, Commissioner Little submitted an amendment to the ROO that would give APS another chance to come before the commission prior to the next rate case.  In it, Little writes: 

"While this issue can be further explored in APS’ next rate case, that rate case will not be filed until sometime next year and will not be decided until over a year after that. Any resolution resulting from the rate case would likely not be in effect until over two years from today. We believe that is too long to wait to address the potential issues presented herein. We believe examination of an interim solution in an evidentiary hearing is appropriate..."

The Commission then voted 3/2 in favor of the amended ROO (Little, Forese, and Stump in favor; Bitter-Smith and Burns against).

What This Means for Verrado:

Nothing, yet.  Even if accepted, the measure wouldn't impact existing customers.  However, the issue will come back again and APS has another shot at convincing the ACC that future solar customers should pay more.  And, if that happens, it is a likely first step to increasing the LFCR charge for ALL solar customers in the next rate case.  

If you want to be heard in this issue, visit the Corporation Commission's website and submit a public comment form, citing the docket number: E-01345A-13-0248