Arizona Public Service proposes cuts to NEM for residential customers

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Arizona's largest utility company has today filed proposals to state regulators designed to choke the growth of the residential market, according to industry advocates.

Arizona Public Service filed its proposals to regulators at the Arizona Corporation Commission requesting approval that all new Net Energy Metering customers would switch to a different rate schedule or agree to a bill credit option. The proposed switch to the ECT-2 rate would almost double daily demand charges for residential customers from a standard fixed fee of $0.285 to $0.556 per day.

The bill credit option would allow APS to pay just $.04c per kilowatt hour and sell it for $0.12c or more, according to Tell Utilities Solar won’t be Killed.

TUSK chairman Barry Goldwater said: “APS wants solar customers to pay more because they use less power. Only a monopoly would come up with a plan like that. Let’s hope our Arizona Corporation Commissioners don’t fall for it.”

The proposals include grandfathering qualifying existing residential rooftop solar customers.

Arizona's NEM programme has no limit to capacity and covers all market segments except utility scale, but system load may not exceed 125% of customer’s total connected load. APS's proposals, however, clearly target the flourishing residential market.

APS says that PV installations have grown from 900 rooftop systems in 2009 to 18,000 in June 2013, averaging an additional 550 installations each month. The utility claims that solar customers avoid $1000 a year for services such as grid connection, shifting $18m a year to non-solar customers. Every year this is unresolved this growth costs APS $6-10m, according to APS.

Carrie Cullen Hitt, senior vice president of state affairs for the Solar Energy Industries Association, said: “Today’s filing from APS comes at the conclusion of a long and challenging stakeholder process in which SEIA has been heavily engaged. While we have voiced some serious concerns throughout this process related to the transparency of APS’ decision-making process and its method for determining the value of net energy metering for all its ratepayers, we remain committed to working with both APS and the ACC.

“Arizona has just begun to scratch the surface of its solar potential. It’s essential that we keep smart policies like net metering in place.”

Arizona boasts the most solar per capita of any state in the nation with 1,146MW of solar capacity. Beyond making a smart energy choice, a recent study commissioned by SEIA shows that these customers’ investments provide $34 million in financial benefits per year to all APS customers. Overall, Arizona ranks second in the country for most installed solar, with enough capacity to power more than 145,500 homes.

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