The following column is the opinion and analysis of the writer.
It was shocking to learn that millions of people in California were cut off from power two weeks ago due to rolling blackouts. As intense heat hit the region, we learned that California was not prepared for the electricity demand. We also learned that California has become increasingly dependent on energy imports and that California did not have a plan for reserve energy in the event regional energy supplies or renewable energy resources were short during peak periods from 3 to 8 p.m.
As an Arizona Corporation Commissioner, it is my job to ask whether Arizona is at risk for a similar fate and to protect consumers. I requested Chairman Bob Burns host an emergency meeting last week to discuss why California’s rolling blackouts occurred and to receive assurances that our utilities in Arizona were on track and prepared to meet demand during one of the hottest summers on record. When the meeting was not called by the chairman, I hosted the emergency meeting myself and invited the CEO’s of APS, TEP and AEPCO to join me and my fellow commissioners. Thank you to Commissioner Justin Olson for his sharing in his concern for this critical issue.
As a result of the meeting, we’ve learned that the impact of high temperature days in Arizona, combined with electricity turnoffs from disconnections, can lead to serious health and safety concerns, especially for our most vulnerable populations such as seniors and young children. During the summer, the commission has required that utilities honor a moratorium on disconnections until October 15.
However, the moratorium does not apply to rolling blackouts, which would be especially concerning due to the large number of people working remotely and children learning from home during COVID-19.
Higher utility prices and lack of affordability are another growing concern in Arizona due to the large number of people furloughed or laid off during COVID-19 and the number of small businesses throughout the state that are struggling.
California’s energy crisis impacted the entire regional wholesale market, and we learned during the emergency meeting that the price of reserve energy shot up to $1,600 MWh at the peak of the crisis two weeks ago. While we received assurances that the spikes did not impact Arizona’s retail electricity prices at the time, it is clear that the lack of planning by California could have a long-term effect on the price of excess energy in the region.
During the emergency meeting, APS, TEP, and AEPCO spoke about the conservation requests made to their customers where they asked families to raise thermostats further and to reduce energy use. Each utility assured the public and the commission that they did not have plans in the near future to request conservation again. We also confirmed that 100% of any net revenue utilities receive from the sale of excess energy to the regional market that was created due to conservation efforts would be passed on to Arizona customers.
The emergency meeting was an indication that there are still many questions pending about Arizona’s risk of an energy shortage during this regional heat wave. I am submitting a question this week to the utilities to ensure their efforts are transparent to the public and that they are held accountable to provide reliable and affordable electric services throughout Arizona.
