Janet Dean, community affairs manager for Arizona Public Service Co., and Cholla Power Plant Manager Rick Nicosia attended the May 9 Holbrook City Council meeting, providing a rate review update and a report on the status of the Cholla Power Plant in Joseph City
Dean explained that APS is involved in a rate review process that is expected to be finalized next month with what she felt was a positive outcome for customers. She noted that the review was requested in order for the utility to move forward with the three tenets of “cleaner, smarter and stronger power.”
According to Dean, APS originally requested a 5.74 percent rate increase across all of its customer classes and the agreement brought that down to 3.3 percent. “For residential customers, it’s a little bit higher because we will have to deal with the increase in rooftop solar that impacts residential rates. So the increase for residential customers is 4.5 percent, down from an original request of eight percent. That means a $6 per month increase for our residential customers,” she said.
For non-residential or commercial customers the overall increase will be 1.9 percent.
“There’s also going to be a $15 million refund of surplus energy efficiency program funds that have not been expended. That will be refunded to customers through the first year of the rate review,” she said.
Dean noted that the Arizona Corporation Commission received a letter of concern from a Holbrook resident regarding the impact on limited income customers. In response to that letter and other similar reports of concern, the rate income agreement will increase funding from $35 million each year to $48 million into that program to provide discounts that people can qualify for and receive through APS. It will also now be a flat percentage discount rather than a varying discounted system. In addition, there will also be a $1.25 million emergency bill assistance fund.
Dean explained that new rate plans would also be in place. The off-peak and on-peak hours time of use plan now in use will add three more off-peak hours to the day and four more off-peak holidays throughout the year.
There is a new discount rate for schools in the agreement, as well as a new economic development option to encourage businesses to relocate or expand.
“There is also a new rate to attract highly efficient customers such as big data centers that can bring some economic benefit to our state,” said Dean.
Existing solar customers will be grandfathered into the contracts that they have now up to 20 years from the date of their installation. APS will be buying excess energy from new solar customers at a rate of about 12.9 cents. Solar customers will also have a number of different plans from which to choose. As part of the agreement, APS has agreed not to file another rate review before June 2019.
A series of education meetings will be scheduled following the ACC’s decision in June. These will provide information to customers regarding the changes that will take place.
Nicosia then informed the council that there have been no updates regarding the potential closure of Cholla Power Plant and that the plant is still scheduled to operate until 2025.
Nicosia noted that he had a few positive developments. APS recently completed negotiations with Peabody for a new coal contract. Units 1 and 3 are online, and Unit 4 went online last week. “We’re running a lot more this year than we did last year,” he said.
He also said that PacificCorp recently filed an integrated resource plan, and one of a number of scenarios for reducing coal generation includes the retirement of Unit 4 by 2020. “No decision has been made, though,” Nicosia emphasized.
For more information regarding the ACC proceedings and rate changes, go online to azenergyfuture.com.
