Page 6 - the Noise October 2017
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APS IS grAnted ‘SmArt meter’ FeeS
In spite of accusations of using dark money to secretly influence multiple state elections including those of the Arizona Corporation Commission (ACC), reports of health and safety concerns from across the country, protestations from consumers and communities across the state, and even federal indictments and an ongoing FBI investigation — Arizona Public Service (APS) has been granted a rate increase and the go-ahead to implement fees for customers who have refused installation of so-called “smart” wireless electrical meters.
On August 15, the ACC voted 4-1 to allow APS to collect an additional $95 million a year from its customers. The lone dissenting vote was from Commissioner Bob Burns who has been embroiled in a quest to examine what he contends is, at the very least, a problematic re- lationship between the state’s largest electric utility company and other members of the ACC.
For the better part of the last two years, Commissioner Burns has been trying to exercise his legal right — which was supported some time ago by Arizona Attorney General Mark Brnovich — to examine APS’ financial records to determine just how much money the utility and its parent company, Pinnacle West, funneled into campaigns to elect officials who would be favorable to its positions. Mr. Burns’ efforts have been stonewalled; both by Pinnacle West/APS CEO Don Brandt and his own fellow commissioners who are sworn to regulate the utility.
APS says the rate increase will average about 4.5%, or about $6 a month, for residential customers. The rate decision also includes an increase in basic charges for flat rate custom- ers. Those using less than 1,000 kilowatts per month will see their fee go from under $9 a month to $15. For higher use customers, the base rate will increase to $20 a month. APS Vice President Barbara Lockwood says that this and other provisions included in the new rate plan are to encourage consumers to switch to alternate rate structures the company considers “more modern.”
Time-of-use rates and demand charges are the plans APS is pushing on its customers. Time-of-use plans include higher per kilowatt hour charges during peak usage periods with lower rates during off-peak times. Previously, APS offered this program with peak hours set from Noon to 7PM. Under the new plan, peak usage time will change to 3-8PM. This caused concern for some consumer advocates. In particular, the inclusion of the late eve- ning hour of 7-8PM in peak usage time might make it difficult for many households to bear the higher overall rates as additional family members tend to be home during that time.
Another provision of the approved rate plan will allow APS to automatically put new customers (or existing customers who move to a new home) on a time-of-use rate for the first 90 days of service. Only after that initial period will the consumer be allowed to decide whether a flat rate service plan would save them money over time-of-use rates.
Demand rates are another way APS says it will modernize its rate system and “help con- sumers save money” while practicing “better usage and conservation of electricity.” Demand rates are set by looking at the one hour of the month during which on-peak use is the high- est. Averaging the consumer’s kilowatt usage during that hour sets the peak rate for the rest of the month. Once that rate is set, it doesn’t change for the rest of that billing period.
Demand rates, however, are nothing new. APS first introduced them in the 1980s, making them mandatory for new customers that had air conditioning in their homes. The plan proved unpopular. Rates were changed and the mandatory provision was lifted in less than 3 years.
Commissioner Burns tried to have a provision inserted that would guarantee a refund if it turns out new customers would have paid less if they had started with the flat rate. He urged his fellow regulators to make sure that consumers pay “not one penny more” than actual costs of delivered power. APS opposed Mr. Burns’ modification. Ms. Lockwood said, if the company was to make such a guarantee “then there’s really no purpose or reason for customers to actually experience the rates” under time-of-use plans.
In another 4-1 vote on September 12, ACC commissioners approved provisions specific to “smart” meters and fees for ratepayers who have refused their installation. Commissioner Burns was, again, the one vote against the plan.
Administrative Law Judge Teena Jibilian made the decision to separate the smart meter issue from the larger rate case but never made her reasons clear. Citing lower fees negoti- ated through a settlement deal between APS and 30 of the 40 stakeholders that intervened in the case, Judge Jibilian called the agreement a “fair and reasonable balancing of all APS ratepayers and the utility.” She said allegations that the meters pose a risk to safety, privacy, health and other concerns expressed by opponents were unfounded and should not pre- vent the agreement from moving forward.
APS originally asked for a monthly $30 fee to be imposed on ratepayers who refused to have a smart meter installed. In the settlement agreement, the ACC approved a lowered fee of $5 per month, one of the victories of compromise lauded by the judge. However, local Sedona activist Warren Woodward, who has participated in the case as an intervener from the beginning, says the fee is unacceptable at any amount. “Any payment to avoid harm or the threat of harm is extortion,” he said in an email. “I will still be appealing the ACC’s order.” But his appeal will not prevent APS from rolling out changes beginning October 1.
Another provision of the order is that no residential customers will be allowed to keep their analog meters and no commercial or solar customer can refuse a smart meter. Mr. Woodward calls this provision discriminatory as it does not give commercial and solar cus- tomers the same right of refusal as residential customers will have.
6 • october 2017 | the NoISe arts & news |

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