The Arizona Corporation Commission (ACC) struck down rule changes advancing renewable energy usage that would’ve increased the cost to taxpayers. The energy mandates would have required energy utilities to rely more on renewable energies following a certain timeline, which would have increased the revenue requirements of Arizona Public Service Company (APS) by nearly $4 billion and Tucson Electric Power (TEP) by nearly $1.13 billion — costs which taxpayers would’ve borne, as high as 43 to 58 percent more monthly.
These were energy mandates similar to those rejected by voters in the failed Proposition 127 of 2018, which would have required electric utility companies to acquire a certain percentage of their electricity from renewable resources each year, from 12 percent in 2020 to 50 percent in 2030. About 68 percent of voters rejected Proposition 127.
Chairwoman Lea Márquez Peterson joined commissioners Jim O’Connor and Justin Olson in their “no” votes against the rule changes. Commissioners Anna Tovar and Sandra Kennedy voted for the rules.
APS, TEP, and the Grand Canyon State Electric Cooperative Association (GCSECA) all expressed support for the rule changes.
O’Connor said that the utilities are “serious and sincere” with their clean energy efforts. He said that the utilities don’t need rules from the state, especially since they will pose risks to ratepayers.
“The proposed energy rules represent a multi-year, good-faith effort by a great many. During this long process and after years of opposition, our state’s major electric utilities have embraced clean energy and our proposed rules. I was surprised and I made it the focus of my efforts to understand that turnaround,” said O’Connor. “I have concluded its best for the utilities to remain in charge of their resource plans just as they have in the past and it is better for the commission to continue to rely on its prudent standard for holding utilities accountable for the resource decisions and their costs.”
Tovar said the commissioners should be ashamed that they wasted years of staff and commission work from “getting in the way of what is right.” Tovar called out two of the commissioners, O’Connor and Peterson, for “flip-flopping” on their stance concerning the rules. She lamented that commissioners weren’t willing to compromise, like she claimed she had, for the greater good: economic growth, health, and environmentalism through these rule changes. Tovar added that the rule changes had diverse, bipartisan support statewide.
“What this tells me is that these rules are failing because of politics. And basing our votes on politics is a dangerous game, and it is a dangerous game to play with something so important to Airzona’s future. Ensuring clean energy in Arizona is our future, and it’s one of the top priorities I had even before running for this commission. When I took office, I wanted to change the rules. Make them more aggressive. Get us to a clean future, sooner. But I looked at the fads and I knew there was much work to be done on them,” said Tovar. “Let me be clear: this isn’t the Green New Deal. This is Arizona’s clean energy package and [I am] very proud of the work that has been accomplished thus far.”
Olson expressed confidence that renewable energy was still attainable without costing customers more. He also mentioned how he attempted to compromise by introducing amendments that would help reduce the cost to taxpayers with passage of the energy rules. Olson indicated that Tovar’s characterization of commissioners switching votes was unfair because their change reflected new information that came to light.
“We as a commission should have a very clear policy that tells our utilities that they should invest in the technologies that are the most cost-effective method of meeting the energy demands of our customers. And what we have before us in these energy rules is not that,” said Olson. “That is the appropriate demand. That is what the constitution requires of us to expect of our utilities, and that is what we should continue to pursue. That does not prohibit us and our utilities from increasing the amount of renewable energy resources that our utilities use to provide the energy for their customers. In fact, it creates a win-win scenario where our utilities will be investing in the renewable energy projects that are the most cost-effective. We can benefit rate bearers and adopt these technologies at the same time. That’s the approach we should take.”
Kennedy said that clean energy was cost-effective with modern technology. She asserted that it wasn’t possible to determine future outcomes based on present actions.
Márquez Peterson said she supported clean energy by 2050, but an equal priority for her was affordability for consumers. Márquez Peterson expressed confidence that utilities had turned a corner and were willing to adopt clean energy of their own volition.
“It took years to get actual cost data that consumers have been asking for,” said Márquez Peterson. “I believe utilities should be justly and reasonably rewarded when they make prudent and proactive investments in the next generation of clean and renewable energy resources, so long as they don’t jeopardize the safety and reliability of the grid or the affordability of rates.”
In a statement to AZ Free News, Justin Olson asserted that the commission’s vote respected the will of voters.
“First of all this is a tremendous victory for ratepayers. I fought to enact policies to make rates as affordable as possible. Many times I was a lone voice crying at the wilderness — I was the only vote against these mandates,” said Olson. “This was the commission telling the utilities that they must invest in technologies that are the most cost-effective method of generating energy.”
The Arizona Corporation Commission (ACC) passed a motion to prohibit utility companies from mandating the COVID-19 vaccine for their employees, 3-2. Commissioners Lea Márquez Peterson, Justin Olson, and Jim O’Connor voted for a policy prohibiting COVID-19 vaccine mandates; Commissioners Sandra Kennedy and Anna Tovar voted against it. If utility companies do impose a mandate down the road, they will be subject to fines.
O’Connor insisted that it wasn’t good for employment or individual choice to allow utilities to mandate the COVID-19 vaccine. He reminded the commissioners that all of President Joe Biden’s vaccine mandates have been halted by federal courts.
“I think this is our good way of taking care of Arizona’s citizens, workers, and voters,” said O’Connor. “If you force-vaccinate everybody and either having a lot of people leave or fire a lot of people — how do you keep the lights on? How do you keep the water flowing? How do you keep running the business? […] And then, how are you going to treat these employees on their way out the door, after their ten, twenty, thirty years of insurance?”
Olson added to O’Connor’s remarks with a more pointed criticism of Biden’s mandate.
“The unconstitutional overreach of the Biden Administration needs to be challenged,” said Olson. “It is absolutely inappropriate for the government to require anyone to be vaccinated against their will. Anybody has the right to receive the vaccination, but we as the government do not have the right to be requiring folks to make a choice between receiving a vaccine against their will or losing their employment.”
None of the utility companies present at the meeting reported having a vaccine mandate. The companies all noted that they would comply with federal law and regulations.
Kennedy criticized the commission, saying that mandatory vaccinations aren’t new concepts and that those opposed to vaccine mandates are making the pandemic a partisan issue. She added that the vaccine didn’t fall under the question of freedoms.
“It is not responsible for a commission without a single expert in health care or medicine to weigh in on this issue,” said Kennedy. “It is also not responsible for commissioners to make statements spreading unfounded rumors which confuse and endanger the public. I would ask commissioners, before you take a stance possibly geared towards political ambition, to consider the Arizonans filling our hospitals and in ICU beds right now. Many hooked onto ventilators, dying alone.”
Olson responded by reiterating the ACC’s constitutional responsibility to protect employees’ freedom to choose.
Tovar said she felt it was premature to vote on something barring vaccine mandates when there aren’t any in place currently.
The policy to bar vaccine mandates was introduced by Olson and O’Connor last month.
If you don’t typically pay attention to the Arizona Corporation Commission, now is a good time to start.
The role of this government agency is to set rates and policies for utilities. That sounds simple enough, right? But for over a year now, the commission has been in the process of developing a “clean energy” plan that looks to ban all fossil fuels in our state. Next week, this renewable energy mandate will be brought up for a vote again. And the consequences could be a disaster.
Green New Deal mandates would cost ratepayers over $6 billion
In July 2020, the commission quietly released its plan to impose California-style energy mandates in our state. But it wasn’t until August of this year that an independent cost analysis had been completed. And the results were eye-opening.
In order to achieve the 100% clean energy mandate by 2050, utilities would need to phase out all fossil fuels, purchase more solar and wind generation, expand lithium-ion battery storage, and convert natural gas generation to green hydrogen. The cost for all this would be over $6 billion, which comes out to an estimated $60 per month or $720 per year for the average ratepayer.
Remember when the green energy lobby said that these mandates would actually save you money? It turns out that was just another lie. But the cost isn’t the only issue.
The Arizona Corporation Commission (ACC) could vote as early as next month on a proposal that would ensure the reliability of electric, gas, and water service across the state by protecting thousands of utility employees from termination for not receiving a COVID-19 vaccination.
Commissioner Justin Olson and Commissioner Jim O’Connor are advocating for the ACC to adopt a policy and associated rules to prohibit the agency’s regulated utilities -also known as public service corporations (PSCs)- from compelling employees to be vaccinated to keep their jobs. Each violation of the policy could come with a hefty fine under the proposal.
“The Biden administration has unconstitutionally sought forced vaccinations and has intimidated companies into complying with this inappropriate policy,” Olson said of the proposal presented to the other three commissioners last week. “Workers should not have to choose between losing their jobs or being forced to receive a vaccine against their will.”
But Olson told AZ Free News on Tuesday he has another concern with the mandates, one that involves potential negative impacts to Arizona’s regulated utilities due to losing valuable employees through COVID-19 related resignations or terminations.
“Our utilities rely on a highly experienced and trained workforce.” Olson said. “We cannot allow Biden’s unconstitutional vaccine mandate to drive away critical employees whose skills are necessary to maintain safe and reliable power and water.”
The letter Olson and O’Connor sent to their fellow commissioners points out that the agency has the authority in the Arizona Constitution to “make and enforce rules, regulations, and orders” related to the safety and health of employees of PSCs.
“This is especially true when the federal government is intimidating companies to develop, implement and enforce such mandatory vaccine policies,” the letter states.
There are currently two federal COVID-19 vaccination mandates which could impact Arizona’s utilities. One is an executive order issued by President Joe Biden requiring federal contractors and subcontractors to impose mandatory COVID-19 vaccination policies.
According to Olson and O’Connor, the broad language of the executive order implicates the very PSCs which the ACC regulates “that have legally enforceable agreements with the federal government, including military bases in Arizona.”
The other mandate was issued by OSHA. It requires all private employers with 100 or more employees to implement a vaccination policy that can require stringent, invasive testing. The OSHA mandate is currently on hold while under review by federal courts across the country.
One of those courts, the Fifth Circuit Court of Appeals, said OSHA’s mandate “raises serious constitutional concerns” and grossly exceeds the agency’s statutory authority.
Olson and O’Connor have asked that their concerns be placed on the agenda for discussion and possible vote at the ACC’s Dec. 15 and 16 open meetings.
On Tuesday, Justin Olson will call on his fellow members of the Arizona Corporation Commission (ACC) to move forward with providing Arizona Public Service Company customers with alternatives for procuring electricity, and in turn avoid possible litigation stemming from the agency’s failure to comply with state law.
Olson told AZ Free News there is a mandate in Arizona law, specifically ARS 40-202(B), which clearly states that “a competitive market shall exist in the sale of electric generation service.” In fact, about a dozen applications have been filed with the ACC over the years by companies interested in providing such service.
However, those applications have not been acted on, Olson said.
“It’s time that the Corporation Commission complies with state law and authorizes competitive power companies to provide energy services to Arizona residents,” he said. “Customers deserve an alternative to the government granted monopoly.”
The monopoly Olson is currently focused on is held by Arizona Public Service Company (APS), whose October 2019 rate increase request is slated to be discussed at the commission’s Oct. 26 meeting.
APS, a for-profit owned by S&P 500 company Pinnacle West Capital, currently serves 2.7 million customers in 11 of Arizona’s 15 counties, from Coconino County in the north, Yuma County in the southwest, and Douglas in the southwest corner of Cochise County. The majority of its customers, however, are in the Phoenix metropolitan area.
During Tuesday’s meeting, Olson will introduce an amendment to APS’ current ratemaking case to call attention to the lack of competition enjoyed by the company. The amendment would move the ACC toward compliance with the statutory competitive market for electric generation mandate while bringing hope to APS customers who told commissioners about being dissatisfied with the company’s rates and customer service.
“My amendment frees captive APS customers and empowers them to choose what company will provide energy to their homes,” Olson explained. “This amendment will unleash the powerful forces of the marketplace to benefit all Arizonans.”
Even if his fellow commissioners vote down the amendment to the current APS rate case, Olson said he is committed to bringing the ACC into compliance with state law. Doing so is the right thing, he says, to bring more options and better service to Arizona’s electricity customers.
It will also ensure taxpayers won’t end up footing the bill if any of the stalled applicants initiate legal action.
“I will continue to advocate for the Arizona Corporation Commission to come into compliance with ARS 40-202(B) while doing what I can to improve options for all customers,” Olson said.
Olson has been on the ACC since 2017. He announced earlier this month that he has entered the race for the Republican nomination for U.S. Senate.