APS expected to seek 400% solar fee increase

Arizona Public Service hopes to more than quadruple the monthly fee it charges to solar customers, advocates for the rooftop solar industry say.

The move comes just weeks after the Salt River Project board approved a solar charge on users in its territory that is expected to average $50 per month.

Solar leasers and industry experts predicted APS would ask the Arizona Corporation Commission for an increase to the $5 monthly fee the Commission approved in 2013. Those predictions were bolstered when Prosper, an advocacy group that spent more than $1 million on APS’s behalf in 2013 supporting the utility’s solar surcharge, voiced support to SRP’s rate hike.

The fees are used to offset solar customers’ grid usage.

APS is meeting with commissioners and staff to discuss a potential proposal to increase the solar fee, Corporation Commission spokeswoman Rebecca Wilder confirmed Friday morning.

“There’s not a filing before the Commission, so the Commission can’t speak to any potential proposal until it has been filed,” she said.

David Tenney, the director of the Residential Utility Consumer Office, confirmed that his agency has met with APS, but said he hasn’t seen any concrete details of a plan.

“They certainly indicated that it’s something they’re looking at,” Tenney said of an increased fee on solar users.

In 2013, APS originally proposed a solar charge that would have cut the savings of customers with rooftop solar systems from almost 70 percent of their electricity bills to roughly about 20 percent. According to the Corporation Commission’s analysis, that would have reduced customers’ savings from $134 annually to only $35.

The details of a proposal aren’t known yet, but pro-solar group Tell Utilities Solar won’t be Killed, or TUSK, said today that APS would ask for an increase to $21 per month.

That figure comes from a 2013 report by RUCO, which said the solar fee should start at $1 per kilowatt of solar generated, then gradually grow to $3 per kilowatt. The average residential solar unit produces seven kilowatts per month, meaning the fee would max out at $21 per month.

Then-director of RUCO Pat Quinn stressed that the fee increase should be incremental.

“Anything more aggressive could start to trigger rapid declines in installations and significantly hurt the nascent solar industry,” the RUCO report says.

TUSK sent out a press release Friday morning decrying the potential increase.

“Rooftop solar power is under siege from utilities, through utility-backed anti-solar legislation and harmful rate hikes designed to drive the popular energy choice from Arizona,” the TUSK release says.

The Alliance for Solar Choice attorney Court Rich said he’s been told APS will unveil the proposal before the end of the month.

APS isn’t due for a rate case until 2016, so any proposal for a solar fee would happen outside of the ratemaking process.

APS said dialogue with the commission and stakeholders is ongoing, and the $5 per month solar charge was an interim provision. The decision in 2013 says explicitly that the commission can adjust the charge, according to APS.

“The only breaking news on this issue is that it looks like Arizona needs to brace itself for another political circus orchestrated by TUSK and TASC,” a statement from APS spokesman Jim McDonald says. “Instead of engaging in an honest discussion about how to ensure the sustained growth of solar in Arizona, this latest stunt repeats the same tired distortions and character attacks that long ago lost credibility with anyone serious about Arizona’s energy future.”

APS says people are using electricity differently, which requires a stable, modern grid system. In order to sustain such a grid system, “the way electricity is priced also needs to evolve over time.”

Despite APS acknowledgement that the utility is in talks with the commission, McDonald said “it would be premature to discuss future filings.”