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Arizona Net Metering: Solar Customers to Pay Surcharge

Linda Hardesty

Energy Manage APS logoIn a 3 to 2 vote, the Arizona Corporation Commission (ACC) instituted a charge on future customers who install rooftop solar panels and directed Arizona Public Service (APS) to provide quarterly reports on the pace of rooftop solar adoption to assist the Commission in considering further increases. The charge of $0.70 per kilowatt will be effective on Jan. 1, 2014, and is estimated to collect $4.90 per month from a typical future rooftop solar customer to help pay for their use of the electricity grid.

The new policy will be in effect until the next APS rate case, which the ACC directed the company to file in 2015.

ACC’s ruling comes after a contentious battle in Arizona, including controversial advertisements.

The Alliance for Solar Choice (TASC) considered the ACC decision a compromise and said, “This decision by the ACC shows a respect for competition, customer choice, and economic growth in Arizona. Against APS’ wishes, the Commission imposed a compromise fee on solar users that is just 5 percent of what the utility monopoly had been seeking.”

In making its decision, the ACC determined that the current net metering program creates a cost shift, causing non-solar utility customers to pay higher rates to cover the costs of maintaining the electrical grid. The cost shift to non-solar customers is what prompted APS to propose net metering reforms earlier this year. ACC professional staff and Arizona’s Residential Utility Consumer Office (RUCO) also agreed that a cost shift exists.

The fixed charge does not increase APS revenue, but instead will reduce the impact of the cost shift on non-solar customers. The ACC acknowledged that the new charge addresses only a portion of the cost shift.

Current solar customers and those who submit an application and a signed contract with a solar installer to APS by Dec. 31, 2013, are not subject to the new fixed charge.



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