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New Recommended Solar Order a Raw Deal for Arizona

Wednesday, Oct 12 2016

Tom Kimbis

On Friday, Arizona released a Recommended Order and Opinion that would end net metering as we know it in the state and give a raw deal to Arizonans. The proposal is particularly astonishing because Arizona has the greatest solar intensity in the nation.

Homeowners and small businesses are now compensated for any excess power their solar panels produce and sell back into the electric grid using retail electric rates as a base. The order would lower the amount of compensation by treating homeowners and small businesses as if they were big utilities, and reimburse them at a low, wholesale rate. Under that plan, utilities automatically make out, and solar rooftop consumers suffer.

As with many of these sorts of proposals, this one is not wholly negative for solar. It acknowledges the importance of “grandfathering” existing solar customers – keeping them on the more equitable net metering regime in place when they signed up for solar. But this is just a small sliver of sunlight in an otherwise dark proposal.

The proposal recommends replacing net metering with two methodologies. The first would implement an avoided cost approach that ignores the economic and societal benefits that solar distributed generation provides to all ratepayers. The second applies the costs associated with large scale solar projects to distributed generation. Both methodologies substantially undervalue the economic and environmental benefits provided by distributed generation and will harm Arizona ratepayers.

We hope that when the Arizona Corporation Commission hears from the local and state solar companies, business development interests, and Arizonans who value the freedom to choose their own power source, they will listen and consider the full value rooftop solar provides all ratepayers.

Ignoring the benefits would send the message that Arizona doesn't welcome high-tech, fast-growing rooftop solar, and distributed resource providers who can help grow Arizona's economy, provide good paying jobs and save everyone money long term. 

Tom Kimbis is interim president and general counsel of the Solar Energy Industries Association (SEIA).