Net Metering Reform Important For Arizona’S Solar Future

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by Steven Quinn, APS manager of energy delivery – Payson

At APS, our goal is to make Arizona the solar capital of America. We believe we’re well on the way with a plan to shape our state’s solar identity and create a sustainable energy future.

APS has supported the development of solar energy in Arizona for nearly 60 years, and our commitment continues to grow. By the end of this year, the amount of solar power in APS’s renewable energy portfolio will increase to 750 megawatts. That’s enough to power the homes of 185,000 APS customers, including in Rim Country. Overall, APS is investing nearly $1 billion in solar energy installations across the state.

Earlier this month, we began purchasing 100 percent of the power generated by one of the world’s largest solar thermal plants for APS customers. The Solana Generating Station, located in Gila Bend, uses solar energy for up to six hours at full capacity after the sun goes down to provide power to 70,000 customers. It’s a game-changing technology that extends the productivity of solar energy.

A sustainable energy future also includes rapidly increasing adoption of rooftop solar power by homeowners. To do that, however, it’s critical that we have a system in place to foster and sustain the growth of solar for everyone while still maintaining reliable electric service.

The current rules of net metering, the policy under which APS and other utilities compensate solar customers for the energy they produce, basically allow rooftop solar customers to use the electrical grid for free. The costs of maintaining the grid — the poles, wires, substations, etc. — are then shifted to the non-solar users.

Net metering creates a cost shift that unfairly burdens non-solar customers. It collectively costs non-solar APS customers $20 million annually, a figure that will continue to rise as more rooftop solar is installed in Arizona.

In California, a study released by the state’s Public Utilities Commission estimates that net metering will cost non-solar users there up to $1.1 billion a year by 2020.

That’s why fixing the current net metering rules now is critical. Following a series of public meetings, APS submitted a recommendation to the Arizona Corporation Commission that would update the way rooftop solar customers are compensated, which we believe is fair and enables solar to continue to flourish.

The recommendation ensures all customers, solar and non-solar, would share fairly in the cost of maintaining the electric grid. Solar customers are connected to the grid 24/7 — they need it at night, when it rains, on hot days when they are using more electricity than they are producing, and to send back excess electricity when their usage is low. As more people install solar on their homes, it becomes more important that everyone helps to keep the grid operating reliably at all times.

Customers who have already made the choice to install rooftop solar would not be affected by this change. We propose these customers be grandfathered under the current rules, which would remain in effect even if the house is sold.

At the same time, we voiced our support to increase up-front cash incentives for future customers who want the choice of rooftop solar. These incentives can make solar an affordable option for more customers — they can use the money to decrease the initial cost of installation or make a larger down payment on a lease. Importantly, the incentives can be reviewed and adjusted as the solar market warrants. As the cost of solar continues to decrease, the incentives can be lowered, with the savings passed on to customers.

Our plan to reform net metering is a fair approach that will continue Arizona’s leadership in solar energy while protecting the reliable electrical service we all use every day. With as much sunshine as we enjoy, solar power can and should have a bright and long future here.

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