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Arizona Commission Won't Direct Staff To Develop Draft Rules For Full Retail Electric Choice At This Time

Staff Will Continue Research, Report In January 2020, December Workshop Set

September 11, 2019

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Copyright 2010-19
Reporting by Paul Ring •

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The Arizona Corporation Commission won't, at this time, direct Staff to develop a rules package for full retail electric competition for all customers.

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As first reported by, Arizona Corporation Commission Chairman Bob Burns had previously proposed that Staff develop such a draft rules package to be docketed, for discussion, by January 10, 2020. Commissioner Justin Olson favored this approach

However, as previously reported, the three other Commissioners raised various concerns with such an approach

At a Staff meeting today, Commissioners recognized that there was not consensus, or majority, to proceed with Burns' proposed approach

Burns, in seeking support for his proposal, had compared his approach to a legislative budget process, in which an initial budget is filed at the beginning of session to work off of, but which undergoes numerous changes.

Burns emphasized that the draft would have served as a "starting point" to provide "focus" for discussions.

Commissioner Boyd Dunn, however, reiterated that he could not think of a policy of greater magnitude for customers than retail choice, and contrasted it with the legislative budget process, which is expected as it occurs annually

Dunn did not want to get ahead of the Commission's process of reviewing retail choice by issuing a draft set of rules

Commissioner Lea Márquez Peterson reiterated her concerns (see story here) that a draft set of rules could create an anchor bias. Peterson also said she had identified 11 topics she would first like addressed at workshops

Utilities Division Staff said that, absent unanimity from Commissioners, if Staff were tasked with creating a set of rules at this time, Staff would need to develop six documents -- one reflecting each of the Commissioner's concerns, and one with Staff's recommendation.

Utilities Division Staff asked that it be permitted to continue its research of electric choice in other states, and said that it would report on such research in about three months, in January 2020. Staff will docket its research as it progresses. Utilities Division Staff suggested that Commissioners could provide further direction upon reviewing such research (as well as additional stakeholder comment to be sought as noted below)

Utilities Division Staff emphasized the "huge shift" in the electric industry in the state if full retail competition were adopted

Commissioners agreed to schedule the next workshop concerning retail choice for December, likely on December 19

Commissioners agreed to provide Staff with time to continue its research, and did not direct the development of a rules package for full retail choice at this time

Commissioners will also docket any questions or issues to be addressed in the immediate term. Staff will compile these and issue them for stakeholder comment, with parties to be given 60-90 days to respond

Commissioner Sandra Kennedy asked the Commission's counsel when Commissioners would need to disclose any contributions from organizations who favor competition. Counsel reported that such disclosure would be required before a vote is taken, but not before that. Kennedy said she hoped Commissioners would make such disclosure sometime during the process

Counsel also reminded Commissioners that, to the extent an RTO is required, the Phelps Dodge decision held that the Commission cannot require utility membership in an RTO. Accordingly, counsel wanted to flag this issue, with respect to the schedule, to the extent the Commission needs to coordinate with the legislature. Burns noted that one of the questions in the review is whether an RTO is needed for retail choice

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