A Tucson-area electric co-op’s plan to raise basic charges and cut energy credits to rooftop solar customers drew opposition at a public-comment meeting Tuesday in Tucson.
In what has become a familiar scene as Arizona utilities seek higher rates to recover lost fixed costs they blame on rooftop solar customers, about 30 ratepayers and consumer and environmental advocates attended the session on a rate settlement filed by Trico Electric Cooperative and the staff of the Arizona Corporation Commission.
Most of the speakers derided the settlement, which would raise bills for Trico residential customers about $2 month, by raising the basic monthly charge to $24 per month from $15 while lowering some usage-based rates.
The nonprofit, member-owned Trico serves about 40,000 customers in rural areas of Pima, Pinal and Santa Cruz counties.
The settlement also would cut energy credits to Trico customers with rooftop solar systems and add an informational “demand rate” — based on a customer’s highest usage in a month — though it would initially be set at zero.
Formal hearings on Trico’s rate case are scheduled to begin Aug. 17 in Tucson before a Corporation Commission administrative law judge who will make a recommendation to the full commission.
At Tuesday’s hearing, several speakers said the settlement proposal to raise the fixed, basic monthly fee would hit low-income ratepayers hardest, while diminishing the cost incentive to conserve power.
Echoing filings by other state-regulated utilities, Trico says it needs the increase to cover increasing losses from solar customers who, by cutting their grid-power usage, avoid paying about $2 million a year towards Trico’s fixed costs, such as transmission.
Trico member Robert Montgomery, a retired state electrical inspector, said that Nevada essentially shut down the solar industry when it voted in December 2015 to increase charges on solar customers while cutting the rate at which they are reimbursed for excess power they generate.
“Research shows that solar customers have a positive impact on utility finances, because they reduce electricity demand and therefore the huge expense of adding capacity,” he said.
But another Trico member said he believes customers with rooftop solar shouldn’t be subsidized by non-solar customers, as Trico contends is happening now to the tune of $80 a month.
“It seems unreasonable that I should incur additional charges to subsidize other customers on their rooftops,” said Tom Schmidt of Corona de Tucson.
“Self-generating, grid-connecting customers would be allowed to connect, but not at the expense of other customers,” he said.
Other speakers focused on the higher basic monthly charge, which at $24 would be among the highest in the state.
David Likness, who has worked as a volunteer tax preparer for AARP’s Tax Aide program in Tucson, said a $9-a-month increase in the basic charge doesn’t sound like much, but it would pose a hardship to many seniors.
“I’ve seen many, many low-income taxpayers who live only on Social Security,” he said, adding that many file tax returns just to get a $25 excise tax credit check from the state.
Steve Jennings, associate state director for AARP, said the group opposes any move to demand charges, though Trico’s settlement would not immediately impose actual demand charges.
He called such charges “mysterious and unpredictable” charges most customers won’t understand.
“People should not live in fear of their electric bills,” Jennings said.
Demand charges are commonly offered to commercial customers but have not been mandatory for residential ratepayers in Arizona or elsewhere in the nation.
Several environmental advocates said rooftop solar is needed along with other renewables to help reduce pollution and global warming, without affecting sensitive ecological areas like large solar and wind farms.
“We can be using all of the rooftops in the cities, instead of using undisturbed lands,” said Hester van Heemstra, a local climate activist, echoing comments by a Sierra Club official.
The debate over increased fixed charges and rooftop solar also is playing out in rate cases filed by two other Southern Arizona utilities.
A rate case filed by UNS Electric, a sister company to Tucson Electric Power Co. that serves customers in Santa Cruz and Mohave counties, is expected to go before the Corporation Commission for final consideration in early August. UNS recently backed off a controversial proposal to impose demand charges on all residential and small-business customers.
TEP also has proposed raising basic monthly charges and cutting credits to new solar customers. Hearings in TEP’s pending rate case before an administrative law judge are scheduled to start on Aug. 31.
