Arizona Public Service recently presented a $16 million proposal to the Arizona Corporation Commission to provide relief on utility bills for APS ratepayers who were financially impacted by the COVID-19 pandemic. The plan, while imperfect, was carefully designed to provide financial assistance to unemployed individuals and small businesses with the greatest need. Consumer and energy efficiency advocates, such as ourselves, appreciated APS’s desire to help ratepayers struggling to pay their electric bills. However, we thought the aid should come from a source other than energy efficiency funding, which also provides relief to customers.
Unfortunately, APS and the commission instead supported a proposal to use even more funding designated for energy efficiency programs – $36 million – to provide refunds of less than $8 on average to each household considered a small residential customer and $50,000 on average to each Extra-Large General Service customer, hardly the relief purported in their initial request.
Don’t get us wrong. Refunding money to customers is often a good idea, and in general, one we support. However, raiding funds intended for energy efficiency programs fails to recognize the strong return-on-investment energy efficiency brings to customers and our state’s economy. From 2010-2017, every $1 of ratepayer money invested in energy efficiency by APS and Tucson Electric Power returned approximately $4 in benefits to ratepayers. Additionally, energy efficiency is widely acclaimed as providing long-term relief that helps customers lower their bills, reduces energy waste, creates jobs, and boosts the local economy.
While the proposal APS supported and the Commission approved fails to provide significant short-term relief for ratepayers most in need, the Commission can still provide long-term relief to APS customers by voting for a strong APS 2020 Demand-Side Management (DSM) Plan next month. The DSM Plan has the potential to boost weatherization in low-income homes, provide an increase in HVAC rebates, and conduct virtual energy audits. Since 2010, DSM Plans through Arizona’s Energy Efficiency Standard have saved money for ratepayers, led to job creation, and produced more than $1 billion in net economic benefits.
As evidenced above, APS and advocates are not always on the same page. Yet, we agree the APS 2020 DSM Plan deserves a Commission vote ASAP and that APS ratepayers can receive long-term relief through strong energy efficiency programs. For many APS ratepayers, particularly those with a mounting accumulation of unpaid bills, utility bill relief will be needed beyond the next couple of months. Energy efficiency provides utility bill relief not only for months but for years and years to come. And energy efficiency provides financial benefits not only to those who utilize the programs but to all ratepayers through the avoidance or deferral of costly capital expenditures.
The commission can provide long-term relief to APS ratepayers. Commissioner Lea Marquez Peterson and Commissioner Sandra Kennedy have already signaled their support for advancing the APS 2020 DSM Plan. Now is the time for the commission to act.
Diane E. Brown is the Executive Director of the Arizona PIRG Education Fund, an organization that conducts research and education in the public interest. Caryn Potter is a Program Associate with the Southwest Energy Efficiency Project, an organization that promotes greater energy efficiency programs and policies in Arizona, Colorado, Nevada, New Mexico, Utah, and Wyoming.