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APS ups the ante in solar competition

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There is a new kid on the rooftop solar block, and it’s a century-old company called Arizona Public Service.

The state’s largest utility today asked the Arizona Corporation Commission to let it to directly install solar rooftops on 3,000 homes to produce 20 megawatts of energy.

If approved, the proposal would put APS in a position to more forcefully compete with rooftop solar firms and potentially eat into the latter’s market share. Currently, roughly 30,000 homes have solar panels on their rooftops.

The program will cost APS between $57 million and $70 million.

APS executives, however, insisted the utility is not competing with rooftop solar firms. Rather, the executives view the strategy as a way to make solar accessible to consumers who may not have the ability to buy or lease a solar system.

“It opens the opportunity for solar to everybody… in the community,” said Daniel Froetscher, APS’s senior vice president for transmission, distribution and customers.

Marc Romito, manager for APS’ Renewable Energy Program, said it’s not a “competitive scenario.”

“They (consumers) will be able to participate in rooftop solar when they never had access before,” he said, explaining the program will allow those who may be interested in solar energy but never had the opportunity to put panels on their rooftops.

Under the utility’s proposal, participating homeowners do not have to pay a cent for the installation. APS will even pay for maintenance, and more significantly, it is also guaranteeing a $30 credit each month for the next 20 years.

For a participating home, that comes out to $360 a year in savings – or $7,200 over the course of the program. That’s bigger than the monthly electric bill savings of $5 to $10 per month for a typical leased solarized home, which is what solar executives told the Corporation Commission during the net metering battle last year.

APS said it will partner with installers, preferably those based in Arizona, to install the panels.

Sean Seitz, president of the Arizona Solar Deployment Alliance, said APS’s proposal will not take away people’s options to enter into a lease or to purchase solar rooftop equipment.

“It’s 3,000 [rooftops]. APS already has 30,000 [consumers who either own or lease solar panels],” he said. “It’s a piece of the market.”

What it does, however, is create a conversation about solar energy, he said.

“The reality is customers that purchase [a solar rooftop system] can save significantly more than $30 a month,” he said. The typical solar rooftop system costs about $18,000.

In a fact sheet, APS, which is in the thick of a brawl against the solar rooftop industry, insisted that it’s about providing more options to customers.

“Planning ‘what’s next’ for Arizona’s energy future is our top priority. We know our customers want more options for receiving energy to power their lives. This program allows us to partner with our customers and local installers to bring more solar energy to Arizona communities,” APS said.

Essentially, APS is asking the commission, which regulates utilities and set their profits, to allow it to produce 20 MW of solar energy by renting the rooftops of single-family homes.

Under the AZ Sun Program, which the commission approved in 2010, APS is permitted to build up to 200 MW of solar plants across Arizona.

APS said nine plants are either online or under development and are expected to produce a total of 170 MW.

APS told the commission it has two options to bring more solar energy online: Build a community-scale solar plant or install solar panels on rooftops. The company expects the commission to hold a hearing on its proposal this fall.

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