Spurred by a flood of complaints, the Arizona Corporation Commission is in the midst of a study to determine whether Arizona Public Service adequately educated customers on its new rate structure.
The commission had approved a 4.5 percent rate increase for the million customers of the utility company, but a customer’s complaint says customers ended up paying 14 percent more during the first nine months the new rate plan was in effect.
The ACC on Jan. 9 ordered staff to do its own review of the rates before May 5.
The revenue review will focus on whether APS sufficiently educated customers. APS didn't explain how the estimated 4.5 percent increase had to do with a complicated calculation between increases and adjustments. Some of the plans have a complicated demand rate structure that penalizes customers for using power during peak periods. In many cases, APS picked the plan to shift customers onto based on past usage, not best price.
“Due to the significant amount of complaints of large bill increases received by the Corporation Commission, commissioners believe that APS may not have adequately performed its outreach efforts and might be earning profits beyond what was authorized in its recent rate case,” said the ACC in a press release.
However, the Commission stopped short of ordering a full review.
That’s not good enough, said customers who joined a rate review complaint filed by Stacey Champion.
“Customer education is not the problem,” wrote an intervenor in the Champion complaint in his brief filed at the ACC. “The problem is the rates themselves.”
Suzanne Treviño, media relations for APS, said the company worked hard to reach a consensus on the new rate structure with 29 parties, including those for low-income customers and the solar industry.
“A rates expert found that our customer outreach efforts through the change were unprecedented in the industry, and our work to inform and support customers is ongoing,” she said.
Between a lack of full disclosure on exactly how APS calculated the estimated 4.5 percent average increase and the peak demand charges, customers have seen electric bills increase 15 to 17 percent higher than before, according to an analysis of 10 million bills done by Abhay Padgaonkar, an expert hired by Champion for her case.
Champion and other customers filed their case in January of 2018 to demand the ACC accurately analyze the consequences of the new rate structure.
Of particular concern, the time of day rates have significant financial penalties for drawing more electricity between the hours of 3 p.m. and 8 p.m.
The Champion rate review case is the first time customers have requested a new rate hearing from the ACC. Usually companies’ request a rate case.
The Arizona Constitution gave the Commission the authority to set rates for private utilities that have a state-granted monopoly. Public utility companies like the Salt River Project have an elected board and don’t fall under the jurisdiction of the ACC.
The state Constitution says those rates must be “just and fair.”
ACC uses a complicated formula to determine if rates are “just and fair.” The formula takes into account loans, infrastructure investment and the company’s opportunity to earn.
“Each case stands on its own facts and circumstances,” said Elijah Abinah, the ACC utilities division director. “Similar to owning a home where one has debt and equity, a utility can have both debt and equity. Return on equity ... is the portion of the rate base deemed to be supported by the owners’ capital versus money that the utility borrowed.”
Staff then decides how much a utility can earn between paying off its debts, managing its operating costs and what it could potentially earn — or what ACC staff call a company’s opportunity to earn.
Intervenor in the Champion complaint, Warren Woodward argued several points created the higher rates. He believes unless ACC staff takes these points into consideration in their review, the rate structure will stand. They include:
• APS assumed customers would be spread out amongst the rate plans.
•APS forced a large majority of customers into a “most-like” rate, rather than a best price rate.
• The 3 p.m. to 8 p.m. demand rates, along with penalties for using extra power during those demand times cause APS to bill at higher rates than projected.
• APS did not adequately educate customers that it would take awhile to see the seven downward adjustors for energy efficiency, emissions controls on power plants, renewable energy and transmission lines the company anticipated to offset the 15.9 percent base rate increase.
“We will fully cooperate with the effort by the ACC to verify and validate that we properly implemented the approved rates,” Treviño said. “We strongly believe that we implemented the new rates exactly as approved and that the outcomes are what were expected for customers and our company. We believe this rate review will prove that.”
Residents in an apartment complex were jarred Monday afternoon when a vehicle plowed through a back patio.
Chantal Vanacker, who lives in the Aspen Cove Apartments at 801 E. Frontier St., said she ran outside just after noon when she heard a crash and then a woman screaming.
When she saw a yellow passenger vehicle crashed into the patio of a nearby unit, she grabbed her phone and called 911.
She talked to the driver of the vehicle, who she only knows as Kevin. He told her the gas pedal stuck, launching the vehicle into the building.
Officers with the Payson Police Department investigated and found Kevin Murry, 64, was drunk. They arrested him for DUI and he was booked into the Gila County Jail, said Police Chief Don Engler.
Vanacker, who worked as a nurse, said she was concerned to see blood on Kevin’s hand, but it appeared to be just a small cut.
The residents in the apartment were uninjured.
Probation officer Rob Deck draws a line on a piece of paper that forks. The upper line leads to a family, career, a home and travel — all the ingredients for a dream life. The other line falls quickly, tumbling toward drugs, jail and unemployment.
Now which path would you like to take?
For the vast majority of juveniles that Deck works with they point to the upper path. But how to get there?
In an exercise known as “time traveling,” Deck helps them envision a better life and the steps needed to get there.
For many of the teens, this is the first time they have ever thought of what their future could look like and the first time someone has encouraged them to do more.
“They have no plans at all,” he said. “It takes awhile for them to see how to live beyond instant gratification.”
That was the case for Ares Lowery, 16, and Arianna Bravo, 15, two Payson teens who wound up under Deck’s supervision after they made a few too many bad choices.
Ares says, “It was a lot of bad choices and a lot I regret.”
Both teens are nearing completion of their probation stints. And both say they would not be on the path to a better life had they not gone through the program.
Since the Gila County Probation Department adopted the Kids at Hope initiative, officers focus less on teens completing court-ordered hours and more on setting them on a new path.
Deck warns it won’t be easy to get there. It will take work. But the other path, the one they were on, is all too easy.
“I ask them, ‘What is the first step?’ he said. “They come up with the solutions like get a GED or stay in high school. We build from there … My goal is to set them on the right course, not just get them through probation.”
According to Kids at Hope research, helping children experience and practice hope helps them understand and define where life’s journey can lead.
Kids at Hope was founded in 1993 and is based on the idea that students perform better when teachers hold them to higher expectations. This was demonstrated in the classroom in a study about the Pygmalion effect where one’s expectations about a person eventually lead that person to behave and achieve in ways that confirm those expectations.
According to research, programs, like probation, should focus beyond the minimum standards and limit pegging teens as “troublemakers” or “at-risk.” These labels only solidify teens’ choices and keep them on the downward path.
Instead, officers should help probationers dream of a better life and believe they can get there.
For Ares, troubles started in sixth grade. He and a friend were bored and vandalized a property. Later, he started using marijuana.
Eventually, he got caught with drugs. When officers handcuffed him, Ares said the gravity of his choices finally sunk in and he was “really scared.”
“That day I didn’t know my life would change, but from that day forward, I always looked at life differently.”
He started probation, which included drug testing and community service. He went to counseling while his mother Becky attended parenting classes. Afterward, they would get together and work on issues together to fix “the underlying problems.”
Becky said it was one of the greatest things she ever did and helped her reconnect with Ares.
He learned to make better choices and when he “time traveled” he saw his life headed in a positive direction.
“For my future I see myself pretty happy. I want to be a franchise owner, a small-business owner,” he said.
Ares is working to complete his GED and has a job. The money goes toward paying off his court fines.
“Life is absolutely what you make of it,” he said.
Arianna saw her life headed in a downward spiral when police caught her.
She moved to Payson in 2015 to live with grandparents after her parents could no longer care for her due to their own addictions.
She thought she would have a fresh start, but instead she took her newfound freedom and went “crazy.”
She was depressed and sad and started acting out.
She realizes now she was looking to get her parents’ and her grandparents’ attention.
She started drinking and used that to mask her pain.
“I didn’t want to cope, life was just too much,” she said.
In middle school, she met a group of kids that were nice and accepted her. They started using marijuana and drinking together. She eventually got caught.
As part of her probation, she attended counseling and started serving out her community service hours.
She became an aide in a classroom, working with special education students. She found that she loved working with the students and it made her happy to see them succeed.
She is now in the DECA club and dreams of one day owning her own business. Ideally, she would open a business, like a skating rink, so the teens in Payson have something to do besides get in trouble.
Rob Keefe, juvenile programs/treatment manager with Gila County Probation, said both Ares and Arianna are remarkable teens who have turned their lives around thanks in part to Kids at Hope.
The probation department wants to expand their efforts and hopes to open a teen center.
For more information on the probation department, visit their Facebook page, Gila County Juvenile Probation.
A wildfire in Prescott Valley last weekend demonstrated wildfire knows no season.
With the federal government shutdown dragging toward its second month, Rim Country finds itself without Forest Service fire protection.
For Prescott Valley residents, the fire happened on state land. With the quick response of state fire personnel, only 300 acres burned.
“I just drove through 89A on Saturday coming back from (a conference in) Laughlin,” said David Staub, fire chief for Payson. “It’s all standing dry winter cured grass. With enough wind it got going. Now it was on 300 acres of grass land (and) it didn’t get into houses.”
Staub said Rim Country had its own winter wildfire in 2006. The fire burned for a week on the Rim charring more than 4,000 acres.
These winter fires beg the question — what will happen if a wildfire breaks out in Rim Country during the government shutdown?
The government has furloughed Forest Service employees, including fire personnel.
Every Forest Service employee the Roundup contacted gave a canned message indicating they sit furloughed, waiting for the shutdown to end.
None of Rim Country’s federal representatives including Rep. Paul Gosar and Senators Martha McSally and Kyrsten Sinema, responded to questions from the Roundup on the shut down and wildfire services.
Staub said local firefighters would not abandon Rim Country in the event of a wildfire.
“Our intention is that we will deploy to protect our lands,” he said. “We lost a tool in our tool box. We are better together, (but) we would deploy anyway.”
Local firefighters regularly respond to wildfires along with Hotshots.
But local firefighters prepare for different needs.
“We are qualified to fight fires in the wildland,” said Staub. “We are better suited to do the structure and they are better at wildfires. Usually the green trucks and red trucks, we work pretty seamlessly together (yet) it’s going to slow down all of the responses.”
Staub has another concern as well.
“It is hurting our preparedness,” he said. “Fortunately it’s wet now (but) we are dealing with 10 mph winds gusting up to 15 mph.”
During this time of the year, Hotshots or Forest Service engine crews work on thinning projects or prescribed burns.
With the shutdown, none of that is in the works, leaving acres of untreated forest as fuel for the next wildfire.