APS offers fair solar choice plan for Arizona

July 11, 2013

PHOENIX–(BUSINESS WIRE)–APS will submit a plan tomorrow at the Arizona Corporation Commission (ACC) that, if adopted, will foster a sustainable, fair and broad-based solar energy future for Arizona.

The plan is built around two options, either of which would ensure that APS customers who choose rooftop solar in the future will be compensated fairly for the electricity they generate and pay a fair price for their use of the electricity grid.

  • Under the “Net Metering” option, future rooftop solar customers would be compensated through the current “net metering” structure, and would pay a charge for their use of the grid, based on how much electricity they use.
  • Under the “Bill Credit” option, net metering would be replaced by a bill credit given to solar customers for the energy they generate, at a price set by the ACC and based on the market rates APS pays other generators for power.
  • The plan applies only to residential customers, because business customer rates already are designed to fairly reflect their use of the grid.
  • APS also supports increasing the up-front cash incentives for customers who choose solar, enabling rooftop solar to continue thriving in Arizona.

“As a national leader in utility-scale solar, we believe APS can help make Arizona the solar capital of America,” said APS Chairman and CEO Don Brandt. “One of our responsibilities is to make sure the infrastructure is in place to support a future of rapidly increasing solar adoption.”

Today’s rooftop solar customers benefit from a reliable electricity grid that ensures they have the power they need, whenever they need it – at night, in the rain, or when it is so hot they need additional power to run their air conditioners. These customers also use the grid to sell power back into the system when they have more than they can use.

Under current rules, rooftop solar customers are allowed to use the grid essentially for free. As a result, customers who can’t afford solar panels, don’t have a suitable place to put them, or simply don’t want rooftop solar end up paying higher rates. As the number of customers installing solar goes up, it drives rates even higher for non-solar customers, making the problem more difficult to solve.

“As more customers install solar on their homes, it becomes even more important that everyone who uses the grid shares in the cost of keeping it operating reliably for the future,” said Brandt.

Customers who already have installed rooftop solar, along with those who have submitted an application to interconnect a system by mid-October, would be given a 20-year grace period before the new policy takes effect. This grandfathering provision will help protect their long-term commitment to solar.

APS also is supporting an increase in the up-front cash incentive that makes rooftop solar a more affordable option for customers who want to “go solar.”

“We support an incentive program for rooftop solar that is transparent, reviewed frequently by the ACC, and shared fairly among customers,” said Mark Schiavoni, APS executive vice president of Operations.

“Either of the options we have proposed, together with the up-front incentives, preserves the choice for customers to install solar and makes rooftop solar an ongoing sustainable resource, which is not the case today,” said Schiavoni. “Solar customers will be compensated fairly for their solar energy while paying their fair share of the cost of the grid. The result is a system that allows all customers to benefit from solar energy in Arizona.”

Arizona is a national leader in solar development, ranking first nationally in solar power per capita and second in total solar installations. APS ranked fourth among all U.S. utilities for solar installed in 2012. By the end of 2013, APS will have more than 700 megawatts of solar, enough to serve 175,000 customers.

APS also has developed the Community Power Project in Flagstaff, an innovative research pilot studying the effects of large concentrations of rooftop solar in neighborhoods.

“We know solar power is going to play a big part in meeting Arizona’s future energy needs,” said Brandt. “We’re doing our part to help make that happen.”

APS, Arizona’s largest and longest-serving electricity utility, serves more than 1.1 million customers in 11 of the state’s 15 counties. With headquarters in Phoenix, APS is the principal subsidiary of Pinnacle West Capital Corp. (NYSE: PNW).