For Immediate Release | 3-13-19      
  Media Contact | Holly Ward      
  Direct | 602-542-3847      
  E-Mail |      

Arizona Corporation Commission March 13 Open Meeting Highlights

PHOENIX — The Arizona Corporation Commission today convened the second day of its monthly Open Meeting followed by a Staff Meeting to discuss and vote on various water, electric, railroad, and tax reform agenda items. Here is a brief recap of the meeting highlights:

Valley Utilities Water Company, Inc. application to comply with Tax Act approved

Commissioners voted today to approve the application by Valley Utilities Water Company to comply with the Tax Act.

Valley Utilities Water Company, Inc. made a compliance filing stating that existing rates and related revenues were approved based on a 15 percent federal corporate income tax rate, which is lower than the 21 percent rate under the new Tax Act. The company states that implementation of the Tax Act rate of 21 percent could increase its authorized revenue requirement and that the regulatory expense of filing and processing a request for additional revenue could exceed the benefits of such a filing and therefore the company does not intend to file an application for a tax adjustor mechanism.

Corporation Commission staff agree the Tax Act rate could result in an upward adjustment to its authorized rates and revenue requirement and that no further action is required of the company regarding the Tax Act. Chairman Burns amendment, which was adopted, requires the company to file a rate case no later than June 30, 2022.

All documents related to this agenda item can be found in the Corporation Commission's online docket at and entering docket number W-01412A-18-0340.

Walden Meadows Community Co-Op Rate Case

Commissioners voted to approve an update to water rates for the Walden Meadows Community Co-Op. The company is a Class E nonprofit utility providing water service to approximately 290 customers within a 2.7 square mile area south of Prescott in Yavapai County.

Walden Meadows is currently operating under permanent rates and charges authorized in Decision No. 54802 issued in December 1985. The Corporation Commission authorized an interim emergency surcharge in Decision No. 76068, issued in April 2017, in the amount of $8.21 per month per customer, to be in effect from May 2017 to April 2018.

Commissioners voted on the water company's rate case today approving an increase for the typical residential bill for a 5/8 x 3/4-inch meter, with a median usage of 2,910 gallons, from $23.64 to $33.59, excluding the interim emergency surcharge, for an increase of $9.95 or 42.10 percent. Considering the now-expired interim emergency surcharge, the net additional increase would be $1.74 or 5.47 percent, from $31.85 to $33.59.

Today's decision also orders the water company to resolve several plant deficiencies requiring correction, the adoption of an Emergency Water Augmentation Surcharge Tariff for the company to recover costs incurred for water purchases when it experiences an emergency water shortage, and approved a Purchased Power Adjustor Mechanism to pass through increases or decreases due to changes in the rates charged for purchased power through a surcharge on customer bills.

All documents relating to this agenda item can be found in the Corporation Commission's online docket at and entering docket number W-02369A-18-0331.

Johnson Utilities rate case application dismissed

Commissioners narrowly voted to approve Johnson Utilities, LLC's request to withdraw its rate application. In a 3-2 vote, Commissioners approved a Recommended Order which orders Johnson, through its interim manager EPCOR, to file a new full rate case application no later than May 1, 2020. The company is to use a test year ending between August 31 and December 31, 2019, unless EPCOR can demonstrate to staff cause for a test year with an earlier end date.

Today's decision closes docket WS-02987A-17-0392 on the initial rate application and orders the company to establish a new docket when it files its full rate case application.

Arizona Public Service Company Application to Implement Phase II of Tax Expanse Adjustor Mechanism

Commissioners voted to approve the application by Arizona Public Service Company to pass savings on to ratepayers resulting from the Tax Act.

Arizona Public Service Company (APS) has filed an application to implement its Phase II Tax Act compliance. The company proposes to return excess earnings to ratepayers through two bill credit mechanisms, one addressing Phase I and one addressing Phase II, as a combined monthly bill credit to customers.

For Phase I, APS will replace its existing Tax Expense Adjustor Mechanism bill credit of $0.004912 per kWh with a modified rate of $0.004194 per kWh, which will result in a slight bill increase to current bills of approximately 80 cents for a residential customer using 1,100 kWh per month.

For Phase II, APS seeks to refund an additional $86.5 million of tax savings resulting from the federal Tax Act on its Excess Deferred Income Taxes. APS plans to refund this savings over an accelerated twelve-month period. The bill impact for residential customers will be a credit of $0.003048 per kWh, resulting in a bill decrease of approximately $3.35 for a residential customer using 1,100 kWh per month. APS proposes to combine these two bill credits as a single item on customers monthly bills, resulting in a bill credit of $0.007242 per kWh over the twelve-month period. The combined monthly bill credit will result in an approximate $2.55 bill decrease for a residential customer with an average monthly consumption of 1,100 kWh.

All documents related to this agenda item can be found in the Corporation Commission's online docket at and entering docket number E-01345A-18-0003.

Commissioners vote to reduce paperwork following the expansion of eFiling

Commissioners unanimously voted to eliminate an outdated mailing practice following the Corporation Commission's expansion of eFiling services. As part of the new eFiling system, it is now possible for any person to register for an account through which the person can choose to "follow" any docket in which the person is interested. After opting to follow a docket, the person receives an email, with a link to the filing, each time a filing is made in the docket. This includes viewing a related agenda through the online system. Learn how to register for an account on our "How to follow a docket" page:

Corporation Commission moves forward with ASU partnership

Commissioners directed staff to move forward with a partnership with Arizona State University to develop a modeling tool to assist the Corporation Commission with evaluating the energy grid in Arizona. Staff will work with ASU, energy companies, and other relevant stakeholders to develop and implement this tool.

Commissioner Sandra D. Kennedy in February docketed a letter requesting that the Corporation Commission investigate the possible use of a modeling tool developed by Arizona State University (ASU). According to Commissioner Kennedy's letter, ASU President Michael Crow has agreed to donate this modeling tool to the Corporation Commission at no cost. The tool models and evaluates the integration of various types of electric power generating sources at different levels into the Arizona energy grid. This could be helpful in analyzing and determining how the grid could handle the phasing-in of more renewable energy sources, as well as the retirement of various coal and natural gas-fired facilities. The modeling tool would be useful to the Corporation Commission during its Integrated Resource Planning process and its evaluation of Investor Owned Utilities proposals.

All documents related to this agenda item can be found in the Corporation Commission's online docket at and entering docket number E-00000V-19-0034.

A complete list of agenda items and a broadcast of the Commissioner's March Open Meeting is available on the Corporation Commission's website:
# # #

The Arizona Corporation Commission was established by the state's constitution to regulate public utilities and business incorporation. The five Commissioners elected to the Corporation Commission oversee executive, legislative, and judicial proceedings on behalf of Arizonans when it comes to their water, electricity, telephone, and natural gas resources as well as the regulation of securities, pipeline, and railroad safety. To learn more about the Arizona Corporation Commission and its Commissioners, visit