PHOENIX – The Arizona Corporation Commission met on July 13 and 14, 2021 to conduct its monthly Open Meeting. Commissioners discussed and voted on various utilities and securities items. Highlights from the meeting are below:
Arizona Public Service Company’s Amended 2021 Demand Side Management Implementation Plan Approved
Commissioners approved Arizona Public Service Company’s (APS) amended Demand Side Management Plan (DSM Plan). APS submitted its application for approval of its DSM Plan in December 2020 and submitted an amended DSM Plan application in April 2021. The 2021 DSM Plan will continue programs that were approved in its 2020 DSM Plan applicable across multiple customer segments. The 2021 DSM Plan also intends to continue programs intended to assist those impacted by Covid-19.
APS will be introducing a residential battery storage program as part of its 2021 DSM Plan. Customers who choose to add battery storage systems coupled with rooftop solar will receive a one-time incentive of $500/kW, with a cap of $2,500 per home that installs a residential battery storage system and enroll in a Time-Of-Use rate plan. Customers must commit to discharging their batteries during on-peak hours. Additionally, APS is offering an additional $1,250 one-time upfront incentive for customers who agree to share a portion of their battery capacity to serve the needs of the grid. To receive the benefit customers have to agree to a three-year commitment to share up to 80 percent of their storage systems capacity for a maximum of 100 events per year.
As part of its Existing Homes Program, APS offers various incentives for the replacement of old or broken HVAC units with newer and more energy efficient models as part of a whole-home approach to energy efficiency. Residential customers who have been impacted by the Covid-19 pandemic can take advantage of a Covid-19 Quality Installation incentive. This program gives qualifying customers a $1,000 credit for installation of all qualifying 14 SEER units, and $1,200 for all qualifying 15 SEER and above units. The HVAC replacement must be an emergency replacement of existing HVAC equipment that has failed or is failing; the incentive does not apply to early replacement or new HVAC equipment that is not replacing an existing unit. Customers must also self-attest that they have become unemployed because of the pandemic. This program will continue indefinitely due to an amendment from Commissioner Sandra D. Kennedy which removes a sunset on the program at the end of 2021, the program will now continue until further order of the Commission. Additionally, an amendment from Commissioner Anna Tovar expands the eligibility to take advantage of this program to those customers who meet guidelines for the company’s Energy Support Programs or Energy Support with Medical Program.
An Amendment from Commissioner Jim O’Connor will establish an Advanced Rooftop Control (ARC) Pilot Program. This program will be funded at a level of $2 million dollars annually based upon an assumption of an average of $50,000 in rebates per installation. The ARC program will be limited to public, private, and charter K-12 schools and non-profit facilities which provide emergency services and house the needy and homeless. Commissioner Sandra D. Kennedy’s amendment provides that APS dedicate at least 25 percent of its initial annual budget to Title I schools or schools with large populations of low-income and/or at-risk students or some combination thereof. Commissioners Kennedy and O’Connor agreed to merge their amendments. This program incentivizes the installation of energy management systems which allow large facilities to more efficiently heat and cool buildings by being able to set thermostats remotely and independently of one another.
Tucson Electric Power Company EV Charging Tariffs Approved
The Commission approved three applications from Tucson Electric Power Company (TEP) for new electric vehicle (EV) charging tariffs; stand-alone electric vehicle charging (DCFCX), sub metered electric vehicle charging for general service customers (Rider-19), and a stand-alone electric vehicle charging for small general service customers (Rider-20). These applications were filed and approved in response to Commission Decision No. 77289 from July 19, 2019. In that Decision, the Corporation Commission approved an Electric Vehicle Policy Implementation Plan that encourage public service corporations regulated by the Commission to propose EV pilot programs and design innovative rate structures to handle the increased adoption of electric vehicles in the state.
The DCFCX rate schedule will be available to general service customers within the TEP service territory where electricity is primarily consumed by EV charging stations that are metered separately from other facilities and allows for resale of the electricity. The DCFCX rate is a tiered structure tied to hours of use where delivered energy rates decrease as load factor increases. Monthly basic service charges under this new rate are structured as follows: small general service time of use, $29.00; medium general service time of use, $40.00; large general service time of use, $950; and large power service time of use, $2,000. The price of energy delivered will be at the following rates measured in kWh/kW: first 30, $0.150000; next 60, $0.100000; next 120, $0.062500; and any additional beyond that at, $0.031250. This rate structure encourages EV charging during super off-peak times.
The Rider-19 rate schedule is a new time of use, super-off-peak charging rate applicable for general service EV customers, with super-off-peak hours between 10 p.m. and 5 a.m. Service under Rider-19 will commence once appropriate submetering equipment has been installed. Customers are incentivized to charge their EV’s during super-off-peak times by providing a discounted kWh rate for the electricity. The base power charge discount rate ($/kWh) is as follows: small general service customers, $0.00750; medium general service customers, $0.00750; and large general service customers, $0.00500. This rate schedule allows for resale of electricity.
The Rider-20 provides customers rates according to TEP’s current small generation service time-of-use rate schedule and customers purchasing power under Rider-20 may resell the electricity. The purpose of this tariff is to expand rate options for DC fast-charging stations that avoid demand charges and was developed with input from EV industry stakeholders. Rider-20 will be available until June 30, 2031, after which all Rider-20 customers will have to take service under the DCFCX rate schedule, or any of TEP’s other medium or large general service rate schedules.
Commission Approves Rate Decrease for Saddlebrooke Utility Company
Commissioners approved a rate decrease for Saddlebrooke Utility Company (Saddlebrooke). Saddlebrooke is a Class C public service company providing wastewater service to approximately 5,156 customers in Pinal County, Arizona.
Because some operational factors have changed since Saddlebrooke’s last rate case in 1998 including significant growth and the federal income tax rates, the company’s application that was filed August 21, 2020 resulted in a rate decrease. Residential and commercial wastewater customers will see monthly bill decrease of approximately $4.35, from $39.30 to $34.95, or 11.07 percent.
Commission Finds Former Securities Salesman Defrauded Investors
The Corporation Commission ordered Tarleton J. Karry and Grand Oak Enterprises, LLC of Scottsdale to pay $403,000 in restitution to investors and a $96,000 administrative penalty for fraudulently selling promissory notes.
The Corporation Commission found that Karry sold the unregistered notes to seven investors, some of whom were friends, acquaintances and one who was a former, financial services client. The Commission found Karry represented himself and his affiliated company as a middleman for a construction company that would use investor funds for real estate projects with promises of interest payments paid to investors from Karry and Grand Oak Enterprises, LLC.
However, the Commission found Karry and his affiliated company failed to disclose to investors the financial risks or provide documentation associated with the investments, and that Karry was not registered to offer or sell investments in Arizona at the time of the sale. Karry was formerly registered as a securities salesman with the Corporation Commission’s Securities Division until April 2016.