ARIZONA SOLAR S O L A R S T O R M

Size: px

Start display at page:

Download "ARIZONA SOLAR S O L A R S T O R M"

Anthony Waters
8 years ago
Views:

1 ARIZONA SOLAR S O L A R S T O R M

2 BACKGROUND AZ Coops are fully regulated by Arizona Corporation Commission (ACC) While AZ Distribution Coops are subject to ACC Renewable Energy (RE) Standard Rule, they are not subject to the 15% RE by 2025 requirement. RE Requirements are for Distribution and not AZ G&T. 30% of the 15% RE Requirement must come from DG This is the first of the ingredients needed for solar companies to want to do business in your state. The other ingredients that solar company models are built on are Net Metering and Investment tax credits.

3 BUY VS. LEASE First solar roof-top units were owned by our members Cost of Solar was high - $25k to 30k Limited no. of customers were willing to spend the $ and could use ITC (100 systems a year per Cooperative by mainly affluent customers). Market evolved to a leasing model Members can now lease solar roof-top systems for 20 years with little or no money down but need good credit. For some of the cooperatives, during a two month period at end of 2014, the no. of new leased solar rooftop systems has increased by 50% of total no. of systems installed over the last 9 years. For one cooperative, that amounts to $1 million revenue loss that is growing.

4 NET METERING & ITCS Net Metering : Incentives were paid by all cooperative members in form of surcharge on bills to buy down cost Net metering Payment of 12 cents for all power produced in excess of energy used Cooperative would only have paid 4 cents to buy this power on market so there is an 8 cent subsidy. This problem is compounded by the fact that the fixed customer charge does not recover the Distribution or G&T fixed costs, a good portion of which are recovered through the kwh rate. Federal Income tax incentives of 30% and State Income Tax Incentives

5 NET METERING As time goes on, the number of these rooftop systems grows quicker than projected due to the no money down leasing model. AZ Cooperatives are pro-solar but conclude: Revenue losses are in Millions for cooperatives and growing rapidly. Solar should stand on its own and not be subsidized Our non-solar members should not have to pay/subsidize new solar installations but will continue to do so if nothing is done to address net metering payments and low customer charges.

6 NET METERING The ACC has several applications to eliminate the subsidy paid through Net Metering by paying avoided cost for new solar customers. As a result, Solar companies have formed organizations (i.e. TASK, TUSK, Checks and Balances) that enlist existing solar customers, use contributions from solar companies, intervene in all utility matters, attack utility board members, management and ACC Commissioners and other elected officials who support changes to Net Metering. These organizations main message is the utilities are trying to kill solar.

7 NET METERING Our members like solar and believe they are doing the right thing by placing it on their rooftops. Our members do not understand/realize that the members without solar are subsidizing the costs of members with solar. Difficult to explain this net metering subsidy issue to members. This discussion about the subsidy makes members feel guilty about solar ownership. My mother installed solar cause she believed she was helping the environment The Cooperatives supported members buying solar

8 UTILITY ACTIONS TAKEN APS has requested demand charge be paid by solar customers of between $50 to $100 per month. ACC only allowed $0.70 per KW or $5 per month in 1 st application. APS has now requested a $3 per KW charge or $21 per month on average. Two coops have filed rate case applications requesting increases in monthly charge from $10 to over $20. One Coop has requested a separate charge for solar customers. Both Coops have requested that after a certain date for new solar customers that only avoided cost paid for all energy generated over usage.

9 NET METERING - LESSONS Need to educate members on true costs of solar Messaging may need to stress that cooperatives need to modernize rates rather than eliminate subsidy Grandfathering the net metering subsidy for existing solar customers eliminates most of the current solar owners complaints. Cooperatives need to be prepared for attacks by solar companies. Get prepared for public records requests.

10 ARIZONA CORPORATION COMMISSION MAKE THE HEADLINES Roberts: Little and Forese: In the bag for APS? Who? Us?, AZ Republic, 10/7 Attorney: ACC can't subpoena utility records over campaign spending, AZ Daily Star, 10/7 Solar customers not happy with local utility, Sierra Vista Herald, 9/30 BURNS SUBJECT OF COMPLAINT FOR LOBBYING STATUS Exclusive: ACC, APS surprised by intensity of the solar industry challenges, attorneys say, Phoenix Business Journal, 9/23, Utility regulator Susan Bitter Smith faces new conflict-ofinterest complaint, AZ Republic, 9/22, 3 Arizona Corporation Commission members hit with new bias complaints, AZ Republic, 9/19,

Distributed Generation and the Retail Utility of the Future

Distributed Generation and the Retail Utility of the Future May 15, 2014 National Governor s Association Policy Academy Workshop Kris Mayes Director, Utility of the Future Center, Arizona State University