PHOENIX – The Arizona Corporation Commission held its monthly Open Meeting on November 9th and 10th, 2022, to discuss and vote on various utilities and securities items. Below are highlights from the meeting.
Commission Approves SunZia Transmission LLC Amended Transmission Project
Commissioners voted to approve a modification to the Certificate of Environmental Compatibility (CEC) for SunZia Transmission LLC (SunZia) which will allow it to construct new transmission lines in a corridor connecting Central New Mexico with South Central Arizona. The original CEC was approved in 2016 by the Line Siting Committee and the Commission for SunZia to construct the project, however, that decision was challenged in the Superior Court and then the Arizona Court of Appeals, both of which upheld the Commission’s Decision.
The CEC authorizes SunZia to construct a 550-mile transmission corridor from New Mexico to Arizona. The project consists of two 500 kV transmission lines, one alternating current (AC), the other either AC or direct current (DC), a 500 kV substation (Willow Substation), and a DC converter station (SunZia West). The project is expected to deliver wind energy from New Mexico into Central Arizona. This will be the largest renewable energy project in the Western United States.
In May 2022, SunZia submitted an application requesting that the Commission amend its original Decision and CEC. SunZia requested the amendment specifically to authorize the use of an updated structure design and additional structure types that result from the detailed engineering efforts associated with the DC facility. SunZia also sought to bifurcate the original Decision into two separate CECs to allow for separate ownership of each transmission line, which would enable the projects to be financed. Finally, they requested an extension of time for completion of the project from February 2026 to February 2028.
All documents related to this agenda item can be found in the Corporation Commission’s online docket at https://edocket.azcc.gov and entering docket number L-00000YY-15-0318-00171.
Transportation Electrification Plans for TEP and UNS Approved
Commissioners voted to approve Transportation Electrification Plans and Budgets from Tucson Electric Power Company (TEP) and UNS Electric, Inc. (UNS). Commission Decision No. 78383 from December 2021 required both utilities to file their plans. UNS’s 3-year budget is $1,278,500 and TEP’s 3-year budget is $34,793,775.
The objectives of each utility’s plans are:
Both TEP and UNS were ordered to supplement their plans to incorporate a High Adoption Rate scenario, which aims to have 20-percent of Arizona’s light duty vehicles be electrified by 2030, which is approximately 1.076 million EV’s by 2030. Each company will propose new rate designs for customers with EVs which seek to incentivize and accelerate the adoption of EVs in their service territories. Further, there are specific incentives for commercial and fleet customers to adopt EV technology included in their plans.
All documents related to these agenda items can be found in the Corporation Commission’s online docket at https://edocket.azcc.gov and entering docket number E-00000A-21-0104.
New Commercial EV Rate Approved for Arizona Public Service Company
Commissioners voted to approve an application from Arizona Public Service Company (APS) seeking approval for a GS-EV charging rate schedule for business customers to incentivize charging company electric vehicles (EVs) during off-peak hours.
The rate will be available to business customers taking service under APS’ general service Time-of-Use (TOU) rate plans. The GS-EV rate will provide an incentive to charge EVs at the customer’s site during the off-peak hours of 9 a.m. through 3 p.m., all days of the week Monday through Sunday. The off-peak period aligns with both business hours and the maximum hours of solar production on the APS system. The new rate consists of two elements, the off-peak kilowatt-hour credit and on-peak kilowatt-hour premium charge for the total energy used for the billing cycle.
All documents related to this agenda item can be found in the Corporation Commission’s online docket at https://edocket.azcc.gov and entering docket number E-01345A-19-0236.
Commission Approves Bond Issuance for Salt River Project
The Commission voted to approve an application from Salt River Project (SRP) which requested an order authorizing SRP’s issuance of Revenue Bond and Refunding Revenue Bonds. SRP sought authorization to issue Revenue Bonds in an amount not to exceed $1,800,000,000 and issue Refunding Revenue Bonds in an amount not to exceed $3,000,000,000, an aggregate amount not to exceed $4,800,000,000.
In its application, SRP stated that the issuance of bonds is necessary to pay or reimburse SRP for the construction costs of improvements, replacements, additions, extensions, and betterments to its electric system. SRP argued that the capital investments are needed in anticipation of significant population growth in Maricopa County that will require 35-percent growth in peak electricity demand by 2030. SRP stated that it is in the process of transitioning its generation fleet and its transmission and distribution system to support a low carbon energy future. The issuance of the bonds is critical to being able to finance the addition of needed generation capacity, and the transmission and distribution improvements necessary to meet SRP’s 2035 sustainability commitment. The Refunding Revenue Bonds will be used to refinance existing debt if it is financially advantageous to do so.
All documents related to this agenda item can be found in the Corporation Commission’s online docket at https://edocket.azcc.gov and entering docket number E-02217B-22-0208.
Commission Approves First Step in EPCOR Standpipe Application for Rio Verde Foothills
The Commission voted to approve waivers of certain administrative requirements for EPCOR Water Arizona, Inc. (EPCOR) in order to begin the process of establishing standpipe water service to the Rio Verde Foothills Community (Rio Verde) and a limited Certificate of Convenience and Necessity (CC&N) to serve the community. EPCOR requested the limited CC&N for the purpose of providing the standpipe water service strictly to the residents of Rio Verde. Because of the limited nature of the CC&N, various waivers of preliminary filing requirements were requested by EPCOR, which the Commission approved.
All documents related to this agenda item can be found in the Corporation Commission’s online docket at https://edocket.azcc.gov and entering docket number W-01303A-22-0264.
Commission Approves Sale of Golden Corridor Water Company to Arizona Water Company
The Commission voted to approve a joint application from Golden Corridor Water Company (GCWC) and Arizona Water Company (Arizona Water) for the sale and transfer of GCWC’s assets to Arizona Water, and for an extension of Arizona Water’s Pinal Valley Certificate of Convenience and Necessity (CC&N) to include the territory served by GCWC. The joint application also approved Arizona Water to charge its existing rates to GCWC customers and an approval for an acquisition adjustment surcharge to recover the acquisition premium paid to acquire the GCWC system.
GCWC is a Class E water utility located near Casa Grande, Arizona, that serves approximately 62 connections. Its CC&N was revoked in 2007 and since that time Arizona Water has been serving as Interim Manager of the system. Arizona Water is a Class A water utility with 24 public water systems across eight counties in Arizona, serving approximately 103,000 customers.
Under the new rate structure approved with the sale and transfer of assets, former GCWC customers with an average consumption of 6,300 gallons on a ¾-inch meter will see rates increase by approximately $33.05, or 84.97-percent. Their existing rates had been in place since 1992.
All documents related to this agenda item can be found in the Corporation Commission’s online docket at https://edocket.azcc.gov and entering docket numbers W-02497A-22-0010, W-01445A-22-0129, and W-02497A-22-0129.
Commission Sanctions Tucson Investment Adviser Rep with License Suspension and Penalty, Orders Restitution for Investors
The Corporation Commission sanctioned investment adviser representative MaRico Tippett of Tucson with a 30-day license suspension for failing to disclose a material conflict of interest to his clients. The Commission also ordered Tippett to pay $28,231 in restitution and a $2,500 administrative penalty.
The Commission found Tippett earned $28,231 in sales commissions from selling $327,345 worth of unsecured promissory notes in Premier Global Corporation but failed to disclose this information in writing to his clients. The Commission found the failure to disclose this material conflict of interest could have reasonably impaired the rendering of unbiased and objective investment advice from Mr. Tippett.
In settling this matter, Tippett admits to the Commission’s findings and agrees to the entry of the Commission’s consent order.
All documents relating to this agenda item can be found in the Corporation Commission's online docket at https://edocket.azcc.gov and entering docket number S-21198A-22-0162.