APS bill relief? From where it comes matters

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Let’s face it. If you are an APS customer, you are likely not pleased with the utility’s last rate hike or that it is now seeking an additional rate hike totaling $184 million. Relief from high utility bills was needed before COVID-19, and the number of households needing financial assistance now is even higher.

APS is currently seeking approval from the Arizona Corporation Commission to spend $16 million of funds already collected from ratepayers to provide additional relief to its customers. When it comes to using ratepayer money – the money that comes from paying monthly electric bills – it is important that the Commissioners consider all viable options, including the amount of relief to provide, where it comes from, and how it is tracked.

While we recognize the desire that exists to act swiftly to provide immediate relief to ratepayers, the APS proposal is incomplete in a number of ways. For example, the utility does not present potential sources of funding for COVID-19 relief other than the use of energy efficiency-related funds. And the APS relief package proposal is missing important details about how the utility plans to market, track, and evaluate the availability of funds and determine customer eligibility. Before Commissioners vote on this measure, they need to get answers to the above items, learn where APS is experiencing net cost savings and where they anticipate revenue shortfalls, and get a projected estimate on overall need.

The Role of Energy Efficiency in Providing Utility Bill Relief

Commissioners also need to take into account that using, not removing, funding designated energy efficiency programs and helping households lower their utility bills is especially important when more people are at home and many household incomes have been reduced or lost as a result of COVID-19. Additionally, according to E2, the national, non-partisan business entity, more than 44,000 locally-sourced jobs in Arizona are in the energy efficiency industry, and 59 percent of these jobs come from small businesses with one-to-five employees.  

By keeping current funding intact and by approving dedicated funding for APS energy efficiency programs in 2020, the Commission can provide long-lasting financial relief to ratepayers. Energy efficiency programs include such improvements as weatherization for low-income households to new delivery models that can be used in this time of social distancing, such as remote energy assessments, virtual inspections of installed measures, increased emphasis on do-it-yourself retrofits, and use of on-line stores and incentives for energy efficiency measures. Through Arizona’s Energy Efficiency Standard, which has secured funding for energy efficiency programs, from 2010-2017, every $1 of ratepayer money invested in energy efficiency by Arizona Public Service and Tucson Electric Power returned ~$4.00 in benefits to ratepayers and produced more than $1 billion in net economic benefits.

Furthermore, non-residential customer relief can be employed in a manner that can aid ratepayers as taxpayers and stimulate local economies. For example, increased incentives for energy efficiency projects implemented by the State of Arizona, local governments, and schools can provide cost savings on monthly electric bills and help offset decreased tax revenue, with financial benefits continuing long after the pandemic is over. And since many small businesses do not have up-front financing, enhanced energy efficiency programs that meet their needs will help small businesses recover much more quickly, while contributing to the local economy.

APS customers need relief. Energy efficiency provides relief. Now is the time to increase investments in energy efficiency programs for ratepayers.