Phoenix, Ariz.— At the Arizona Corporation Commission’s (ACC) August 8, 2023, regular open meeting, the Commission adopted eight amendments proposed by Commissioner Nick Myers, resulting in a reduced rate increase for TEP customers. 

In TEP’s initial rate case application, filed in June 2022, it requested a Return on Equity (ROE) of 10.25 percent and a return on the fair value increment (FVI) of 0.66 percent, resulting in an estimated bill increase of $14.22 for the typical TEP residential customer of average monthly consumption.

“I’m grateful the majority of my fellow Commissioners voted in favor of the eight amendments I proposed,” said Commissioner Myers, “My amendments reduced rates, eliminated subsidies, and protected customers from hidden charges.”

Commissioner Myers’s amendments:

• Established a ROE of 9.55 percent with a return on FVI of 0.00 percent. This combination of ROE and FVI resulted in an overall lower revenue requirement than proposed by the Administrative Law Judge in the Recommended Opinion and Order.  
• Eliminated an unfair subsidy only benefitting electrical vehicle (EV) owners. “It is unfair for certain customers to get a discount on all of their electric energy usage simply because they own an electric vehicle,” said Commissioner Myers.
• Required TEP to refund to customers any unused Demand-Side Management Surcharge (DSMS) funds remaining after December 31, 2023.
• Eliminated adding Energy Efficiency (EE) and Demand-Side Management (DSM) resources into Rate Base. “Adding these types of resources into Rate Base makes them less transparent to customers and creates additional costs because TEP would earn a return on these resources,” commented Commissioner Myers. 

Commissioner Myers’s remaining amendments modified TEP’s EV rate plans to encourage off-peak vehicle charging, added customer protections for a proposed Bring-Your-Own-Device program, and eliminated Phase 2 of the rate case, saving time and resources for ACC Staff, TEP, and Intervenors.  

“Although the Commission has yet to confirm the final calculations provided by TEP, I was pleased to see TEP announce that the estimated bill increase for the typical customer with average monthly consumption will only be around $11,” said Commissioner Myers, “This relatively modest increase balances the Commission’s constitutional duty to establish just and reasonable rates that protect customers and that protect the reliability of the electric grid.”  

For more information about these amendments, please contact Amanda Hasty at myers-web@azcc.gov