Phoenix, Ariz. —   The Arizona Corporation Commission on Tuesday, December 17, 2024, during an Open meeting voted 3-1 (with Commissioner Tovar dissenting, and Commissioner Marquez Petersen excused from the vote due to her unexpected absence to tend to a family emergency) to approve the Recommended Opinion and Order in the matter of the 2024 APS Rehearing on Decision No. 79293 – Grid Access Charge.  Based on the evidence presented during the 6-day rehearing that concluded in November 2024, the ACC found that the application of federal and Arizona law reflects that the Grid Access Charge (GAC) does not unlawfully discriminate against residential solar customers, is supported by substantial evidence, and is just, reasonable, and in the public interest.

Administrative Law Judge Belinda Martin stated in her Recommended Opinion and Order, the “salient point is that APS must provide safe and reliable service to all customers. In general, all costs related to such services should be equitably distributed to each class of service. As demonstrated . . . residential solar customers are paying less than 70% of the costs to serve them” (page 39)”.  Without the GAC, there is a cost-shift on non-solar residential customers, resulting in discrimination under the record evidence in this case since the cost to serve residential solar and non-solar customer groups are different.

Critics of the Recommended Opinion and Order in this case have publicly mischaracterized the GAC as a “solar tax” on about 184,000 Arizonans with rooftop solar.  The GAC is a nominal fixed charge – between $2 and $3 a month - to recover costs to serve residential solar customers who generate their own electricity.  Residential solar customers rely on APS’ power grid to provide electricity when their systems are not producing, similar to relying on the power grid as a battery source of energy.  It’s important to note that nearly 73,000 APS residential solar customers who are grandfathered under net metering are not subject to the GAC, therefore about 111,000 APS residential solar customers are paying the GAC.  The GAC helps recover the costs of maintaining the range of services and equipment that helps ensure safe and reliable electricity service.  Previously, these costs have been absorbed by other non-solar residential customers. 

“$61 million dollars were imposed on APS’ residential customers that do not have solar.  That means about one million customers have been paying the bill for those that have solar on their homes,” said Chairman Jim O’Connor, who cast his final vote as Chairman and Commissioner.

“I understand no one wants to pay more on their bills, but this is about parity and fairness for all ratepayers,” said Commissioner Kevin Thompson.  “I hope there’s a day when homeowners can live completely free from the grid, but we are not there now. I believe all costs related to providing service should be equally and fairly distributed among all classes of customers and we have a duty to address cost shifts and subsidies when they exist.”

Arizona’s Constitution grants the ACC the authority to set just and reasonable rates, and to make just and reasonable rules, regulations, and orders that govern the transactions of business by public service corporations in the state.  The Arizona Corporation Commission’s mission is to power Arizona’s future by ensuring safe, reliable, and affordable utility services.