An Ignoble Experiment

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Arizona's net metering program should spread the cost of maintaining a reliable electrical grid more fairly among all APS customers, according to a ruling by the Arizona Corporation Commission (ACC). In a vote of 3 to 2, the ACC instituted a charge on future customers who install rooftop solar panels. As part of the ruling, Arizona Public Service (APS) must provide quarterly reports on the pace of rooftop solar adoption to assist the Commission in considering further increases.

Credit: Sierra Club

The $0.70 per kilowatt charge will be effective beginning January 1, 2014, and is estimated to collect $4.90 per month from a typical future rooftop solar customer to help pay for their use of the electricity grid. The new policy will be in effect until the next APS rate case, which the ACC directed the company to file in 2015. Current solar customers or those who become solar customers prior to the end of the year will not be subject to the new fixed charge.

The ACC determined that the current net metering program creates a cost shift, causing non-solar utility customers to pay higher rates to cover the costs of maintaining the electrical grid. The fixed charge does not increase APS revenue, but will modestly reduce the impact of the cost shift on non-solar customers.

"The Arizona Corporation Commission has taken an important step in reforming the state's net metering policy. We applaud the ACC for cutting through the rhetoric and focusing on how the cost shift impacts non-solar customers. The ACC determined that net metering creates a cost shift," said Don Brandt, APS chairman, president and CEO. "Of course, having determined that a problem exists, we would have preferred for the ACC to fix it. The proposal adopted by the ACC, and surprisingly championed by the state's consumer advocate RUCO (Residential Utility Consumer Office), falls well short of protecting the interests of the one million residential customers who do not have solar panels. We will continue to advocate forcefully for the best interests of our customers and for a sustainable solar policy for Arizona."

The Solar Energy Industries Association also has concerns about the ACC's decision.

"While we applaud the ACC's decision to keep net energy metering in place -- and appreciate the Commission's last-minute efforts to find a middle ground when it comes to new fees on solar customers -- we are deeply troubled by today's precedent-setting action," said Rhone Resch, president and CEO of SEIA. "Imposing punitive fees on Arizona consumers -- without first proving the need and demonstrating the fairness of these charges through a comprehensive, transparent rate case where due process is afforded -- is patently unfair…Despite having some of the best solar resources in the nation, Arizona now has one of the shakiest policies for encouraging its development."

SEIA makes no secret of its concerns about APS and what it calls utility monopolies.

"We are…very troubled by the public campaign of misinformation, manipulation and distortion engineered by Arizona Public Service. This has never been a 'subsidy' problem as claimed by APS," Resch said. "Unfortunately, the utility exploited this debate and then used it as an opportunity to stymie competition, 'stick it' to consumers and bolster its bottom line. No one should be surprised. This is what monoplies do."

Environmental groups claim that this net energy metering ruling will discourage rooftop solar because of the extra $4 to $5 per month fee. However, the fee that the ACC approved was relatively conservative compared to the larger charge sought by APS.

Today's decision gives the green light to a change in policy that will mean Arizona Public Service (APS) customers who install rooftop solar will have to pay an extra fee, thus discouraging solar rooftop installations. APS and other large utilities had lobbied to curtail and damage the growth of the state's rooftop solar economy by advocating for a much larger charge on rooftop solar than the ACC approved. The expansion of rooftop solar energy production has come to represent a growing threat to APS' monopolized business model that relies on discouraging market competition, including rooftop solar.

"[The] decision to add new charges to Arizona's main rooftop solar program will stifle the growth of our clean energy economy," said Will Greene, Sierra Club's Phoenix organizing representative. "We acknowledge APS originally proposed a much larger charge, but our state's burgeoning private solar industry will still need to overcome this new challenge."

For more:
- see this article

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2. Is CCS ready for prime time?

By Barbara Vergetis Lundin

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3. Websites, IVRs demonstrate utilities' attempts to connect with customers

The House Subcommittee on Energy and Power last week held a hearing on EPA regarding proposed and existing power plant regulations and related legislation drafted by Senator Joe Manchin (D-W.Va.) and subcommittee Chairman Representative Ed Whitfield (R-Ky.).

A coal-fired power plant in Wyoming. Credit: Greg Goebel/Wikimedia Commons

Senator Manchin testified in support of his legislation, saying, "It's time we strike a balance between a healthy environment and a healthy economy…It's time the EPA started working as our partner, not our adversary, to achieve that balance. And the EPA can start by recognizing it is just common sense that regulations should be based on what is technologically possible at the time they are proposed."

There has been no "adequate demonstration" of CCS on any commercial scale, according to Laura Sheehan, senior vice president of Communications at the American Coalition for Clean Coal Electricity (ACCCE).

"…yet members of this Administration, including EPA Administrator Gina McCarthy and Department of Energy head Ernest Moniz, continue to falsely claim that the technology is ready," Sheehan said. "If EPA's New Source Performance Standards are enacted as they stand today, the United States will fall to the back of the line as a leader in developing this promising technology, while other nations eagerly steal our spot in what is expected to be a nearly trillion dollar industry."

Congress heard from technology experts, power plant operators and state regulators who also disagreed with the U.S. Environmental Protection Agency (EPA) that carbon capture and storage (CCS) technology is ready for use at power plants.

"These experts testified that CCS is a young, complex and unproven technology. The experts said much more work must be done to take CCS from pilot projects and field tests to fully integrated demonstrations and operations at the scale required by power plants before it is ready and reliable," said National Mining Association (NMA) president and CEO Hal Quinn. "Just because EPA believes CCS is ready doesn't make it so, and technology experts say it isn't. The last thing American households and businesses need is another 'rush-before-ready' policy that gambles with our economic and energy future."

For more:
- see the draft legislation

By Barbara Vergetis Lundin

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4. CPUC approves EPIC for utilities' clean energy investment

Many utilities are enhancing their customers' online experiences through their websites; some are doing better than others. E Source has once again named the top-rated U.S. and Canadian electric and gas utility websites.

Credit: Rodolfo E. Aristimuño/Wikimedia Commons

The U.S. honors go to Wisconsin Public Service, Pacific Gas and Electric, and Avista Utilities. Énergie NB Power, BC Hydro, and Union Gas Limited make the top-rated Canadian utility websites.

This is the second time since 2011, Wisconsin Public Service and Énergie NB Power, have held the top spots in their respective regions.

E Source usability scores, which measure how easy it is to use a feature on a website, continue to improve. In particular, the usability score for the Make a Payment feature has dramatically increased.

"The improvement in the usability score for the Make a Payment feature is encouraging," said Rich Goodwin, manager of Customer Experience & Marketing at E Source. "Think about it: Customers want to pay their bill online. But by and large, utilities were not making it easy to do so. This should be one of the highest-rated features for usability."

The look and feel has also improved with the top utilities providing aesthetically pleasing websites using big, bold text and bright colors. Further, more utilities are offering mobile-optimized features than ever before.

Here are the E Source regional rankings:

Canada: Énergie NB Power, BC Hydro, Union Gas Limited

US, Midwest: Wisconsin Public Service, Vectren Corp., Ameren Illinois

US, Northeast: PPL Electric Utilities, PECO, NSTAR

US, South: Duke Energy, Florida Power & Light Co., Duke Energy

US, West: Pacific Gas and Electric, Avista, Portland General Electric

Here are the E Source rankings by utility type:

Electric: Énergie NB Power, PPL Electric Utilities, Duke Energy

Gas: Southern California Gas Co., Nicor Gas Co., NW Natural

Combined gas and electric: Wisconsin Public Service, Pacific Gas and Electric, Avista

Utility interactive voice response systems (IVR) also continue to improve, offering customers a better experience than in years past, according to E Source.

The top-rated U.S. electric and gas company IVRs are Pacific Gas and Electric, Columbia Gas of Pennsylvania, and Portland General Electric. Union Gas Limited, Nova Scotia Power, and Hydro-Québec operate the top Canadian utility IVRs.

"The increased effort put forth to make the IVR experience positive is great news for consumers," said Goodwin. "Although more and more customers are turning to the website to conduct business, there will always be a segment that wants to use the telephone as a contact channel, at least in the foreseeable future. It's very encouraging to see that utilities haven't given up on this contact channel and continue to improve it."

Further, those utilities that also scored high in terms of their website want to provide their customers with a good experience consistently, regardless of the channel the customer is choosing.

The following utilities ranked top in their respective regions:

Canada: Union Gas Limited, Nova Scotia Power, Hydro-Québec

U.S., Midwest: DTE Energy, American Electric Power, Peoples Gas

U.S., Northeast: Columbia Gas of Pennsylvania, Public Service Electric & Gas, National Grid

U.S., South: Duke Energy Progress, Florida Power & Light Co., South Carolina Electric and Gas (SCANA)

U.S., West: Pacific Gas and Electric, Portland General Electric, Arizona Public Service

E Source ranked the following utilities top in their respective utility types:

Electric: Portland General Electric, American Electric Power, Florida Power & Light Co.

Gas: Columbia Gas of Pennsylvania, Peoples Gas, Union Gas Limited

Combined gas and electric: Pacific Gas and Electric, Duke Energy Progress, DTE Energy

For more:
- see this review
- see this review

Read more about: E Source, top utility websites
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By Barbara Vergetis Lundin

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5. Xcel maximizing wind energy investment

The California Public Utilities Commission (CPUC) has approved plans for coordinated public interest investments by utilities in clean energy research and development in order to reduce the costs and broaden the benefits of the state's efforts to mitigate climate change.

Credit: Sacramento, California. Credit: Devin Cook/Wikimedia Commons

In 2012, the CPUC established an Electric Program Investment Charge (EPIC) to fund public interest investments in clean energy research, development, demonstration, and deployment. Since then, the California Energy Commission, Pacific Gas and Electric Company, San Diego Gas and Electric, and Southern California Edison -- the bodies charged with administering the program -- developed initial investment plans through public processes. This Decision approves these 2012-2014 investment plans and establishes strict program administration and accountability requirements.

The EPIC program is designed to encourage the development of new and emerging technologies in California, while providing assistance to commercially viable projects and is funded at $162 million per year.

"EPIC was created to fill the gaps in funding resulting from the expiry of the Public Goods Charge. The state Legislature has ratified the CPUC's ability to oversee EPIC, confirming the CPUC's strong belief that EPIC has clear value to ratepayers," Commissioner Mark J. Ferron.

The CPUC adopted metrics and potential areas of measurement for evaluating the investment plans, and established an annual report outline to facilitate consistent reporting by the administrators on project results. The CPUC also adopted contract and grant solicitation guidelines for the utilities to follow when soliciting competitive bids for EPIC contract work and evaluating any bids received.

"The state has ambitious plans to mitigate the universal threat of climate change. We will not succeed without research, development, and deployment of new clean energy research technologies," said CPUC President Michael R. Peevey. "…we have set up a framework under which the investment plans of the administrators are likely to provide electricity ratepayer benefits by promoting greater reliability, lowering costs, and increasing safety."

For more:
- see the proposal

By Barbara Vergetis Lundin

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