ACC Votes to Do Away With Solar Grid Access Fee

11.1 kW Rooftop Solar installation in Phoenix, Arizona with Silfab 360 watt modules.

ACC Votes to Do Away With Solar Grid Access Fee

As a final result of their most recent rate case this month, the Arizona Corporation Commission has voted to do away with APS’ grid access fee for solar homeowners. The ACC is the governing body that oversees APS’ rates and overall finances. It is estimated that the adoption of the amendment will reduce annual electric bills for solar customers by about $100. This will translate to thousands over the life of the system. The commission voted to eliminate the decade-old solar fee while also modifying the time-of-use plan times and ruling on a couple of other issues. These rulings come as a much-needed change of position for the commission which has a long history of favoring APS.

The Final Result

This decision comes as the result of the most recent analysis performed by the ACC of APS’ financials. This time around, the process started out with APS asking for another $184 million in revenue in the form of a rate increase. The commission, led by Chairwoman Lea Marquez-Peterson, voted to instead lower APS’ revenue, primarily by lowering APS’ return on equity from 10% to 8.7%. The predicted result of the rate case was a decrease in APS’ annual base revenue by $119 million. This will result in a modest decrease in everyone’s bills, especially those with solar.

The most controversial part of the rate case resulted in the ACC voting to only allow APS to reclaim a little less than half of their $400 million investment in the Four Corners coal power plant, which is closing. This last issue has APS promising to sue the ACC over these rulings, but we have yet to see what could come of such a case.

The Background

In 2017, the ACC passed a rate increase and re-design that caused confusion and hurt solar homeowners in particular. This newest ruling is a big step for the commission, which has since been entirely replaced by the Arizona voters.

This time around, the ACC asked APS to perform a self-audit, and APS responded. Instead of the requested revenue increase, however, the commission voted 3-2 to lower their rates for the first time since 1996.

Sandra Kennedy, the commissioner who originally proposed the solar-specific amendment, sided against the measure because she felt it did not go far enough to compensate people from coal-impacted communities. The commission did, however, vote to distribute $144.5 million of APS funds to communities negatively affected by the Four Corners and other closures (tribalbusinessnews).

The Threat to Sue

APS has responded to all of this by threatening to sue, as well as threatening homeowners that the move is going to increase their electric bills in the long term even stating that the decision will “put our state’s economic future at risk.” APS would most likely have to appeal the ruling through all of Arizona’s state courts before being able to pursue any sort of trial.

Chairwoman Marquez-Peterson said in a statement that the Commission serves as the substitute for market competition and that “when we’re dealing with captive customers and monopoly utilities, effective rate regulation is the solution.”

A Bump For Solar

While the results of a promised lawsuit have yet to be seen, it is interesting to note that APS makes no mention of the solar grid connection fee in their complaints. If this ruling stands, it is a huge step for the ACC and for the future of solar in Arizona.

To get a quote for a solar system including zero grid-access charges, inquire today!

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