There is perhaps no greater attack on net metering ongoing than that being unleashed by the utility industry in Arizona. Starting in 2013, Arizona Public Service (APS), the state’s largest utility, admitted that it had paid a Koch-funded group (60 Plus Association) to run anti-solar ads after denying it was funding the campaign earlier in the year. Sean Noble, who has been described as the “wizard behind the screen” in the Kochs’ donor network, was running the coordinated attack on net metering at the time. This campaign led up to a November 2013 regulatory hearing on APS’ proposal to charge net metering customers between $50 and $70 per month. Regulators ultimately ruled that the utility could charge 70 cents per kilowatt, which comes out to a $5 per month fee.
In 2014, The Arizona Republic reported that, “APS is widely believed to have contributed to the independent groups that supported Forese and Little and ran $1.3 million in negative ads against Democrat Sandra Kennedy as well as primary opponents of Forese and Little.” The Arizona Free Enterprise Club and 60 Plus Association, ran ads in support of Republicans Tom Forese and Doug Little for the two open seats on the Arizona Corporation Commission (ACC). The ACC regulates and sets rates for the electric utility companies in the state.
This year, Tucson Electric Power (TEP), another utility in the state, proposed changes to weaken net metering in the state, as did APS and Salt River Project (SRP). The latter is a municipal utility that is governed by board of directors, not the ACC. 12 of 14 board directors of SRP voted to approve solar-rate charges that will add $50 to the average solar customer’s monthly bill. The fee increase began in April. Customers who already had solar installed will not see a fee increase for 20 years and anyone who buys a home with a solar system installed will be “grandfathered” from the fee during that 20 year period. The fee increase was hotly opposed. A crowd of over 500 people showed up at the SRP board meeting to protest the utility’s proposal and the increase prompted SolarCity to file a lawsuit against the utility for “violations of antitrust law.”
TEP’s proposal argued for adding monthly fees of about $22 onto solar customers current bills. The ACC staff recommended rejecting the changes, but only until the TEP proposal could be analyzed in a full rate case.
The ACC staff also recommended that regulators reject APS’ proposal to increase monthly fees for solar customers by about $21 per month, which is an increase from the current $5 fee that the utility has been charging since 2013.
The staff recommendations are not binding and commissioners may still choose to hear the utility proposals.
These policy and regulatory discussions were not the only developments in Arizona. A whistleblower in February revealed that a former utility regulator, Gary Pierce, held frequent “secret” meetings with the CEO of APS and other top executives from the utility during his time as commissioner. The allegations are under review by the state attorney general’s office. However, a review of commissions’ calendars by The Arizona Republic recently revealed more relationships between the commissioners and the companies they regulate.
The water got even muddier when it was brought to light that Justin Pierce, Gary Pierce’s son, received nearly half a million dollars from groups that were funded by APS during his campaign for secretary of state.