PHOENIX — Gov. Doug Ducey has named former Republican congressional contender Lea Márquez Peterson of Tucson to the agency that decides how much utilities can charge their customers.
Thursday’s announcement came just after Ducey said that Andy Tobin will leave the Arizona Corporation Commission to become head of the state Department of Administration. That agency handles internal matters for state government, like payroll and managing office space.
Márquez Peterson, former president of the Tucson Hispanic Chamber of Commerce, will fill out the balance of Tobin’s term on the Corporation Commission, through 2020.
She will be the first Southern Arizona resident to sit on the commission since Paul Newman, a Bisbee Democrat, left office in 2013.
The announcement comes at a particularly critical time at the commission, which is looking at whether Arizona Public Service, the state’s largest electric utility, is earning too much. The regulators gave the go-ahead in 2017 for APS to collect another $95 million from customers.
Commissioners voted earlier this month not to reopen that rate case. On Thursday, just hours after Tobin resigned, the commission voted to push ahead with a plan to have APS file a new rate case, using 2018 as the test year, to determine if the charges being imposed are too high and should be scaled back.
That followed disclosure a month ago that Pinnacle West Capital Corp., the parent company of APS, reported profits in the first three months of 2019 of $17.9 million, versus $3.2 million for the same period a year ago.
Pinnacle West gave Márquez Peterson $2,500 in the Republican primary election last year. Her congressional campaign also was the beneficiary of $5,000 from David Hutchens, chief executive of Tucson Electric Power, and $350 from TEP lobbyist Steve Eddy.
But she told Capitol Media Services those donations are different than the money APS funneled into commission races in 2014 and 2016 to help elect regulators of their choice.
“That was an entirely different race, a different position, representing a district in Southern Arizona,” Márquez Peterson said. “So I consider that completely separate from a role at the Arizona Corporation Commission.”
Anyway, she said, Pinnacle West also gave $5,000 to Ann Kirkpatrick, her Democrat opponent, who went on to win the congressional seat.
“I had many different citizens and businesses and others support me in my race for Congress,” Márquez Peterson said. “And I don’t think that made be beholden to anyone in particular.”
The Tucson Hispanic Chamber, under her leadership, took a position last year against an initiative that would have required utilities like APS and TEP to generate half of their electricity from renewable sources.
But Márquez Peterson, noting other business groups also opposed the measure, said that does not necessarily align her with the interests of the utilities.
“The reason ... was the dramatic impact it would have on the cost for small business to do business in the state of Arizona,” she said, calling the renewable energy goal “too fast of an increase and too short of a time period.”
The defeat of that measure kept in place the current commission-established standards that require regulated utilities to generate 15 percent of their electricity from renewable sources by 2025.
Márquez Peterson said she has taken no position on the question of whether APS is earning too much.
“At this point I’m starting to do further research,” she said, adding that she was planning to meet with commission staff for the first time “and really start engaging.”
Ducey has proven himself an ally of APS. Last year the Republican governor signed legislation, crafted by APS, to protect utilities if voters had approved the renewable energy initiative, by making any violations subject only to a fine of as little as $100.
California billionaire Tom Steyer, who crafted the renewable energy initiative and spent $28 million in the unsuccessful campaign, blasted Thursday’s appointment.
“Utility monopoly APS bankrolled Ducey’s campaign for governor and now Ducey has returned the favor by appointing another beneficiary of APS campaign cash to the commission that regulates APS,” Steyer said in a statement to Capitol Media Services.
Pinnacle West donated $10,200 to the Ducey campaign through its PAC. CEO Don Brandt gave $5,100 each to the governor’s reelection campaign and to the separate Ducey Victory Fund. Brandt’s wife, Ginger, also put in $5,100 to Ducey’s campaign.
Aside from donations by other executives, Pinnacle West gave $100,000 of corporate money to the Republican Governors Association, which then spent money on commercials attacking Ducey’s Democratic challenger David Garcia.
