Millions in cash burned on one war over rooftop solar panels

Bloomberg

There’s a war brewing over the future of rooftop solar, and Arizona is at ground zero. Pinnacle West Capital Corp., which owns the state’s largest utility, last week said it has formed a third-party group to support candidates for an elected state board that regulates their industry. The move promises to inject $1 million into a race in which SolarCity Corp., a rooftop solar provider, is already planning to spend $2 million through a nonprofit it supports, according to officials from the two groups.
It’s the latest twist in a three-
year political battle that’s been punctuated by charges of undue influence, an ongoing probe by the US Attorney’s office and $300,000 in threatened state fines. At stake: A board ruling on a request to raise fees and drastically cut how much homeowners are paid for the solar energy they generate. It’s a decision, foes say, with the potential to hamstring a growing renewables industry.
“It’s not surprising that you are seeing campaign-style tactics in
what should be a wonky policy matter because there is a lot at stake here,” said Tyson Slocum, director of the energy program at Public Citizen, a consumer advocacy group. “The rooftop solar issue has become broadly politicized.”
Utilities nationwide are pushing regulators to cut mandated solar payments, an expense they say requires them to boost rates on non-solar customers in order to maintain the grid. Solar supporters, meanwhile, say a big drop in the amount paid to homeowners would undermine the benefits of switching to green power and imperil the industry’s double-digit annual growth.
A decision by Arizona, which last year generated the third most solar power in the US, could serve as a bellwether for national change at a time when as many as two dozen other states are weighing the same issue, according to a report by the North Carolina Clean Energy Technology Center. Pinnacle West’s Arizona Public Service unit has had 99 megawatts of home solar installed in its territory this year, an investor presentation filed Thursday shows.
In December, Nevada regulators voted to allow utilities to increase fees and reduce payments to home solar users. A month later, California rejected reduced solar credits. Now, the spotlight swings to Arizona, one of only 14 states with an elected board — the Arizona Corporation Commission — that sets regulatory policy and utility rates.
Arizona has long required utilities to pay consumers for solar energy they put back into the grid. In November 2013, the commission allowed utilities to assess a small connection fee to offset part of that payment. Now, the commission is being
asked to consider a proposal from Arizona Public Service that would almost triple the fee for some customers to $24 a month, and cut consumer credits for solar power by as much as 80 percent.
Arizona Public Service has more than 50,000 customers with home solar. To pay them, the company estimated it will have to raise bills for non-solar customers by $51 million annually starting next year. At the same time, a June report from Credit Suisse Group AG said approving the new proposal could make solar “uneconomic” across a state that is among the nation’s leaders in the use of home solar.