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Arizona needs a full analysis of rooftop solar benefits

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As the chairman of the Federal Energy Regulatory Commission under two presidential administrations, I had a system-wide view of America’s electrical grids. But as I look at the stalled debate over Arizonans’ access to solar energy, I’m reminded of my time as Nevada’s first Advocate for Customers of Public Utilities.

There, I was able to approach the grid from the perspective of the ratepayer. What’s best for the people? What do they tell us they want, and how can regulators accommodate them?

Wellinghoff, Jon

Jon Wellinghoff

For the past three years, the rooftop solar debate in Arizona has been a “he said/she said” between utilities and rooftop solar companies regarding the value and benefits net-metered rooftop solar provides to ratepayers. Both parties have a financial interest in winning this debate, and the tone has at times obscured the fact that it is really about what’s best for the people of Arizona.

There is a simple way for the state’s regulators at the Arizona Corporation Commission to end this back and forth: undertake a comprehensive cost-benefit analysis, conducted by an impartial third party group, that will finally look at the full range of benefits that rooftop solar provides to all Arizonans.

SolarCity recently partnered with the Natural Resources Defense Council to undertake such an analysis in Nevada, where in December a thriving rooftop solar industry was shut down virtually overnight by a decision of the Public Utilities Commission (Nevada’s version of the Corporation Commission). The study analyzed a complete list of benefit categories for solar, as had been suggested by Nevada regulators. The results showed that Nevada rooftop solar benefits all ratepayers, including those who don’t install solar.

We believe the same results will be proven true in Arizona if the ACC will request that a full and fair study be done.

Last week, one of Arizona’s administrative law judges filed her recommendations for the state’s first of six upcoming utility rate proposals. She made the common sense suggestion that no decisions be made until after the ACC’s ongoing value of solar proceeding finishes, and delivers a methodology that captures all of the benefits and costs of rooftop solar. This is an encouraging example of regulatory leadership insisting on fact-based decision-making that the public expects.

SolarCity recently joined with six New York utilities and other solar companies to propose a data-driven investigation into rooftop solar’s benefits to the local grid. Critically, all parties agreed to maintain net metering policy for a period of three years, so that a thorough investigation can be conducted without upending consumer choice or job-creating industry. I implore the Commission to likewise balance any necessary changes with a gradual, phased-in approach so as not to destabilize consumers, solar businesses, or utilities.

I believe it is in the interests of all Arizonans, both those with solar and those without, to conduct an impartial study that recognizes the full benefits that distributed solar extends to all ratepayers. It is also in the people’s interest to take on any disruptive changes on a gradual, manageable timeline. Arizona has too much potential as a national and global solar leader to do otherwise.

Jon Wellinghoff, the new chief policy officer of SolarCity, is the former chairman of the Federal Energy Regulatory Commission and former general counsel and consumer advocate at the Nevada Public Utilities Commission.

3 comments

  1. Not a bad idea except NDRC are not impartial. Find another outfit.

  2. Jon Wellinghoff is 100% correct when he states that “It is also in the people’s interest to take on any disruptive changes” (regardless of timelines) and that “Arizona has too much potential as a national and global solar leader to do otherwise.”
    It is encouraging that the ALJs of the ACC are weighing a third party analysis into the consideration before ruling on this issue.
    If a regulatory commission is truly acting in the public interest of Arizonans, and exercising consideration for more than one party, it’s analysis and rulings should result in policy that encourages incentives and partnership between both sides; Arizona’s utilities and solar ratepayers.
    When Arizona ratepayers and utilities begin to adopt a different (and non-traditional) long view to partner together and produce/wheel power to other states the result would have both lower energy cost for Arizona ratepayers and greater amounts of energy that Arizona utilities could resell into higher priced energy markets.
    It is time for Arizona utilities to end the adversarial upward rate spiral (including proposed solar taxes, predatory demand charges, unending rate increases) with their ratepayers and learn how to build a partnership to prosper from the abundant energy rooftop solar systems harvest every day in Arizona.

    metrowatertucson.com

  3. What Arizona and the whole country needs is NOT a benefit analysis, but an analysis of why solar still costs too much to be competitive on a level playing field. All the incentives and pricing gimmicks that are funded by taxpayers and ratepayers simply make it too easy for the costliest alternative (solar) to look good. In fact, the incentives have only served to increase profitability (or reduce losses) of the solar companies.

    Get rid of all the “disincentives” and make the solar industry (manufacturers, distributors and installers) actually become cost-competitive with traditional energy alternatives. Only then will solar be a truly economical answer, and the benefits of solar be real. We don’t need some high-priced consultants’ theories on how “beneficial” solar can be, we need the market to tell us that.

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