I’ve introduced House Bill 2701 to save utility customers money.
Did you know that in 2010 alone utility customers will pay over $120 million in tariffs added to their utility bills caused by unreasonable mandates imposed by the Corporation Commission?
WHAT MY BILL DOES:
1. Gives the legislature exclusive authority over setting renewable energy policy. The legislature can set a statewide energy policy that is good for AZ and for utility customers. This will streamline our state’s energy policy by keeping it within one body, as opposed to two entities with separate agendas and will make sure that the citizens have more say in setting energy policy since they can contact their elected representatives.
2. Adds nuclear and hydro-electric to the mix of clean energy sources that can be used to reach a 15% clean energy goal.
WHY I’M INTRODUCING THE BILL:
1. The renewable energy mandates imposed on the utility companies by the Corporation Commission are costing utility customers MILLIONS of extra dollars every year. To give you an example:
· APS and Tucson Electric are forced to charge their customers over $120 Million this year to pay for the mandates.
· Sun City Recreation Centers paid over $52,000 in these extra tariffs in 2009 alone.
· In these economic times, it is not right to ask hard-working Arizonans, Senior Citizens, and businesses to shoulder these extra costs
2. The AZ Constitution gives the Corp. Commission authority over rate-making only. The legislature has authority over setting policy, not the Corporation Commission.
3. The Corporation Commission mandates LIMIT clean energy sources that can be used to satisfy their mandates to wind, solar, geothermal, and biomass. Although these are good options that will continue to be pursued, AZ needs a diverse mix of energy sources that can produce base load (not intermittent) energy and not force more expensive and less-reliable energy onto consumers. After all, solar energy costs between .13-.16 per Kwh, whereas nuclear costs .02 cents.
1. In 2006, the Corp. Commission mandated that all electric utilities (except SRP since they are a govt entity) get 15% of their energy from wind, solar, geothermal, and biomass by 2025 (each year up to 2025 they have to reach a certain %)
2. In addition, the Corp. Commission mandated that of that 15%, 30% has to come from distributed energy (example: solar panels on the roof) by 2012.
3. In addition, the Corp. Commission mandated that of that 30% of distributed energy, half has to come from commercial and half from residential.
4. Penalties can be imposed by the Corporation Commission.
5. The Corporation Commission mandated that the utilities charge all the utility customers a tariff on their bills to pay for incentives and compliance costs to meet the mandates. THIS TARIFF AMOUNTS TO MILLIONS IN COSTS TO UTILITY CUSTOMERS EACH YEAR. (For example: APS will charge their customers $81 million over and above their energy usage this year. Tucson Electric will charge $40 Million)
5. To date, the utilities have not been able to reach the distributed energy portion of the mandates because it relies on individual homeowners being able to afford expensive solar panels.
6. In order to meet the mandates, the utilities have to give huge incentives to customers to install solar panels on their roof. One of the lobbyists has $54,000 solar panels on his roof. After federal, state, and utility rebates and credits, he paid $14,000 out of pocket. That means the taxpayers and other ratepayers subsidized his solar panels 74%.
ANSWER TO CONCERNS:
1. Some of the solar companies will say they are opposed to my bill even though I have reached out to them and offered compromises to address their concerns. Let’s face it…they have a good deal going on: The Corporation Commission mandates force the utility companies to buy electricity from them no matter what the cost or the reliability of the electricity….of course they like the current deal. Unfortunately, the tariffs that pay for the subsidies going to them are being forced upon hard-working Arizonans and businesses, many of which can not even afford to buy solar panels themselves, but have to pay for someone else’s.
2. I believe the solar company concerns are over-dramatic. I have spoken to all the utility companies including APS and SRP. They have all said they will continue to pursue solar and other alternative energy sources no matter if my bill passes or not. The momentum for solar is already moving ahead and the support for it is evident by the various solar tax incentives the legislature has already passed. The legislature is not going to put the solar companies out of business. In fact, I believe the legislature is a much friendlier environment for enacting a state wide energy policy.
3. The Corporation Commission is threatened by my bill because it takes away some of their authority. I have spoken to several of the Corporation Commissioners and share many of their visions for energy in our state. However, I believe it is clear that the legislature, not the Corporation Commission, has authority over setting policy in this state and that the Corporation Commission over-stepped their constitutional authority.
My bill is a first step in the process of setting up a statewide comprehensive energy policy in our state that is not only diverse, but also affordable to our citizens.