Merchant Generator Groups Urges Quicker Implementation Of Expanded Buy-Through Competitive Customer Load Programs In Arizona

The Arizona Competitive Power Alliance (AzCPA), whose membership largely consists of independent power producers, urged the Arizona Corporation Commission to accelerate the contemplated expansion of the competitive buy-through programs which allow certain customers to procure competitive electricity supply

As exclusively first reported by EnergyChoiceMatters.com, the Arizona Corporation Commission in December adopted a policy statement to institute a competitive electric supply buy-through program open to medium-sized C&I customers

Currently, such a buy-through program (AG-X) is available to large customers at APS. Under AG-X, a capped number of large customers and load are permitted to procure alternative sources of generation supply, which is delivered to the utility, with the utility ultimately supplying the customer with such alternative generation. At APS, Rider AG-X is available to customers who have an Aggregated Peak Load of 10 MW or more and are served under Rate Schedules E-34, E-35, E32-L, or E-32 TOU L. At APS, total AG-X program participation is limited to 200 MW of customer load, 100 MW of which was initially reserved for customers with single-site peak demands of 20 MW or greater and with monthly average load factors above 70% unless not fully subscribed during the solicitation process.

The ACC in the adopted policy statement set forth a new program, called AG-Y, to be available for, "medium and large commercial customers."

The ACC specifically directed that implementation of AG-Y will not be until the utilities' next rate case. Furthermore, the policy statement does not define any thresholds for eligible medium and large C&I customers for AG-Y. Eligibility will be addressed in utility filings in response to direction from the ACC

In comments in a comprehensive energy rulemaking, the Arizona Competitive Power Alliance (AzCPA) urged the ACC to file implementation plans for the AG-Y programs before the utilities' next rate cases

AzCPA proposed that the utilities should be compelled to file their rules for this expansion in 2019, rather than in conjunction with their next general rate case.

AzCPA stated, "The AzCPA supports competition. And while technological advances and market forces may make retail competition inevitable, the transition is likely to be complex and time consuming. As such, AzCPA first prioritizes ensuring that consumers receive the full benefits of competitive procurement and wholesale competition through the immediate modernization of REST [renewable] Rules and the IRP process."

AzCPA stated, "AzCPA also believes ACC can expeditiously expand the existing AG-X program by removing the caps and expanding the eligible customer base. Additionally, the Commission can expedite the launch of the new AG-Y program. The utilities should be compelled to file their rules for this expansion in 2019, rather than in conjunction with their next general rate case. Given the timing of procurement, development and construction cycles, having the rules in place this year would allow eligible customers to secure the benefits of solar federal tax incentives prior to their expiration in 2023. Any delay in the development of an expanded retail program would likely preclude realization of these benefits and reduce the efficacy of the program to deliver low cost energy and attract new businesses to the State."

"To the extent the expanded program demonstrates success, the ACC can the build off this success to offer a broader range of consumers with retail access, while taking the time to ensure high regulatory and consumer protection standards are maintained," AzCPA said

Arizonans for Electric Choice and Competition (AECC) and Calpine each filed separate comments reiterating their prior comments (see story here) in favor of creating a separate track to review retail electric choice in Arizona

Docket RU-00000A-18-0284