Article Summary –
Arizona’s APS seeks to increase residential energy rates by 16%, impacting retirees on fixed incomes. The company also proposes shifting to formula rates, allowing yearly adjustments with less oversight. Consumer advocates warn of burdens on vulnerable residents and reduced scrutiny on future hikes.
PHOENIX – Edward Van Ness’s hands shook as he addressed the Arizona Corporation Commission in downtown Phoenix.
Before him sat a judge and a commission member, deciding next year’s energy bill costs. Van Ness, Sun City Homeowners Association president, represented his neighbors, fighting APS rate increases as residents struggle with living costs.
This was the penultimate public comment before the APS rate case hearing in May.
Most Sun City residents are retirees on fixed incomes. Van Ness highlighted their struggle: “Do I pay my bills, or do I buy food?”
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Arizona’s largest energy firm, APS, plans a major billing overhaul. Residential customers might see a 16% average monthly bill hike, around $20 more, as APS seeks to raise $579.2 million in revenue.
For many, a $20 increase feels burdensome.
“It’s demeaning,” Van Ness said. “Why am I sticking around? I can’t afford to live anymore.”
While rate hike concerns loom, a significant change is APS’s request to alter its funding method, potentially reducing oversight.
Current APS rates are based on 2021 and 2022 expenses, per Anne Carlton, APS regulatory compliance manager.
“With economic changes, the cost of grid components has risen, some over 70%,” Carlton noted.
If approved, APS’s formula rates would allow yearly, incremental increases without new rate cases for five years, affecting residential customers for the first time.
Under the formula rate, APS adjusts rates annually based on a cost of service study.
“Yearly studies will adjust costs, especially with large customers like data centers,” Carlton explained.
Diane Brown, Arizona PIRG executive director, has been engaging APS customers statewide, advocating through town halls.
“With formula rates, increases could occur annually, with less oversight,” Brown said.
Intervenors such as The Kroger Co., Walmart, and Attorney General Kris Mayes have filed interventions in the APS rate case.
“A $20 monthly increase would deeply affect households,” Brown stated.
The proposed increase affects all classes: 14% on average, 16% for residential, 6%-8% for businesses, and 30%-45% for data centers.
Moreover, APS aims to double the Grid Access Charge for solar customers, seen by critics as a “solar tax.”
Donna Levy, a Peoria resident with 31 solar panels, finds APS pays little for her solar energy.
“A neighbor decided solar wasn’t worthwhile after consulting APS,” Levy shared.
Next in the rate case is May’s final hearing. APS and intervenors will present to a judge and commissioners, who’ll decide the rate hike’s approval and extent.
“You need power to live,” Van Ness said. “It’s disheartening knowing people must make dire choices affecting their future.”
This article first appeared on Cronkite News and is republished under a Creative Commons License
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