The Arizona Corporation Commission voted last week to have staff draft rules to repeal the Renewable Energy Standard and Tariff requiring electric utilities to get at least 15% of their energy from renewable resources by next year.
The measure was enacted in 2006. The Commission’s latest action would also repeal a 2010 requirement setting 22% energy savings for gas and electric utilities.
The move will now start a set of hearings that will last into 2025 to solicit comments from the public and stakeholders.
Commissioners supporting the change say the requirements have been too expensive for customers, with data showing the mandates have led to nearly $3B in monthly billing surcharges to consumers for wind and solar project developments and rebates promoting energy efficiency.
They said utilities should select the most cost-effective mix of energy solutions without being restricted by government mandates that drive up costs.
Supporters of eliminating the renewable energy rules also said intended cost reviews included in the 2006 requirement were never conducted as they were initially intended.
Supporters of the change said the rules distort the market without providing protections to consumers.
Energy efficiency and environmental groups opposed the change, saying the programs have actually resulted in billions of dollars in savings by encouraging energy conservation and reducing the need for new power plants.
One efficiency advocate said research indicates each dollar spent under the programs between 2010 and 2022 yielded a benefit of $3.64.
Program supporters also claimed improvements to overall public health, along with economic benefits.
Solar energy representatives cautioned that becoming the first state to repeal the renewable energy mandate could harm economic development efforts, particularly by driving away “least-cost” solar and wind project developers, leading to more expensive power.
One impact of eliminating mandates, viewed as a positive by some and a negative by others, is the potential to reinforce plans by Tucson Electric Power and Arizona Public Service Company to replace significant portions of their current coal-fired production with gas-fired plants.
Supporters of the change point out that natural gas is the cleanest burning hydrocarbon and eliminates many of the secondary pollutants involved in energy production. Environmentalists and alternative energy advocates want additional CO2-free production like wind and solar that is buttressed by large energy storage systems. (Source)