In Arizona, a state that is naturally endowed to support a thriving solar power market, proponents and the state’s utilities are locked in controversy.
Leading this debate is the state’s largest utility, the Arizona Public Service Co. (APS), which contends that solar customers don’t pay their equitable share of the costs to keep them connected to the grid and that these costs are unfairly passed onto nonsolar customers.
The APS has a motion before the state regulator, the Arizona Corporation Commission (ACC), for an increase in its lost fixed cost recovery (LFCR) for solar customers from $0.70 per kilowatt (kW) to $3 per kW. This charge, also referred to as a “grid-access fee,” is designed to help the utility make up the lost revenue it needs to cover existing costs.
In late September, the utility floated a proposal before the ACC that created more controversy. It offered to drop its motion for an increase in the grid-access fee in exchange for a narrow analysis conducted by the ACC of the true costs of solar power. The motion asks the ACC to make findings about “the costs to serve APS’s residential customers with and without solar and how those costs are collected under APS’s current rate design.”
The proposal may seem fair enough, but some opponents argue that what it leaves out is as important as what it includes. Specifically, solar proponents want the analysis to also include the benefits of solar.
According to its own data supplied to the ACC, the APS asserts that the average solar customer does not pay about $67 out of the $118 it costs the utility to service them every month.
The APS has asked the ACC for a decision on the matter by March 31, 2016.