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Utility customers have option of installing rooftop solar systems

For an American energy sector that hasn’t changed much in a century, rooftop solar represents consumer choice, competition, and innovation.

This is the key to understanding the increasingly anti-solar actions by APS.

When an Arizonan goes solar, they buy less electricity from APS, while saving money for their family. This is good for Arizonans, but APS views it as a threat.  APS makes money by justifying infrastructure investments— a new power plant, or new power lines — which are paid for by ratepayers and which earn the utility a guaranteed profit. As solar allows Arizonans to use less energy, it becomes harder for APS to justify charging ratepayers for more stuff.  According to the APS

2012 annual report to Wall Street, solar has an “adverse impact on [APS’] financial condition.”  That’s Wall Street talk for “bad.”

So while solar is good for the rest of us, it threatens a 100-year monopoly that has served utilities very well. And it is very good to be a monopoly: While APS’ primary expense — electricity itself — has declined by nearly 60 percent over the past five years, ratepayers have not seen a discount on their monthly bills. Quite the opposite; APS rates have gone up for consumers. And since 2008, during enormously trying economic times for its ratepayers, APS net profits increased 51 percent.

Ratepayers used to have no choice but to live with this. But now many have the option of installing solar systems on their roofs. They pay a low monthly lease payment to their solar provider, and between that amount and their new APS bill, they save money every month. Choice and competition empower consumers.

But solar customers are not the only ratepayers to benefit. When one homeowner’s system produces more solar energy than is currently being consumed onsite, that clean energy powers its neighbors’ homes. The solar customer is then credited for their contribution of energy to the grid. The policy which makes this fair exchange possible, and which APS would like to undermine to protect its monopoly, is called net metering.

Net metering makes our electrical grid more efficient: When solar energy is shared locally, APS doesn’t import electricity from large power plants hundreds of miles away. This reduces electricity losses, and saves ratepayers on the costs of paying APS to build and maintain power lines. Many solar customers go solar to save money for themselves and their families, but it actually benefits all ratepayers.

If Arizonans want to make an investment that will save them money on electric bills, they should have the choice to pursue it. So as APS asks the Arizona Corporation Commission to make Arizona — the sunniest state in the nation — the first state to end net metering, we call on the ACC to consider the interests of ratepayers above the interests of the monopoly utility. Ending net metering will do harm to the Arizona rooftop solar industry — currently employing more Arizonans than APS — and deprive consumers of the solar choice that drives innovation, lowers costs, and saves Arizonans money. Between two competing self- interests — the people’s and the utility’s — the choice is clear.

— The authors are CEOs of companies related to solar energy:  Andrew Birch of Sungevity; Edward Fenster of SunRun; Lyndon Rive of SolarCity and Nat Kreamer of Clean Power Finance.

5 comments

  1. Only problem is, we folks who can’t afford solar are also being billed to pay for those who can.

  2. That’s not quite true. Most of the tariff money is now being spent on large, privately operated solar farms, like the ones around Gila Bend. Homeowners can only get a measly $0.10/watt incentive for their home systems. You’re really paying for the big players. The Corporation Commission is not looking out for the little guy. If they kill net metering I think distributed solar is dead.

  3. This debate is all about customer fairness.

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