The Salt River Project (SRP) power district announced earlier this week that customers who want to add solar power panels to their homes will be charged an extra $50 per month starting next April if the SRP governing board approves the new fee.
SRP says they need to find a way to charge those customers who generate their own solar power for the costs of maintaining the district’s power grid, because they still use it even though they’re generating much of their own electricity. They claim their average solar customer receives about $51 in “unpaid services” each month. There’s no itemized expense, however, on the monthly bills of SRP’s residential customers for these “fixed” grid costs.
SRP’s proposal also includes a provision to increase the price of its electricity by 3.9%, which would increase the average residential customer’s bill by about $4.61 per month. They say this hike is necessary to pay to help pay for the more than $1 billion they’ve spent on a new natural-gas power plant and other grid upgrades.
So, SRP is claiming they can payoff a $1 billion dollar investment by raising the bills of their residential electric customers by less than $5 a month, but they need to charge new solar customers $50 per month to help maintain their electric grid. It doesn’t pass the smell test.
So what’s the real reason SRP is proposing the solar fee? If they are truly worried about fairness, why don’t they focus on the extra grid maintenance costs created by their large commercial customers? For example, do they charge mines, factories, car dealerships, and big-box retail stores the full cost of hooking them up to the power grid? And after they hook them up, do they charge them more for grid maintenance? If not, then residential utility customers are being forced to subsidize the electrical expenses of large commercial electricity users.
The future of SRP, and all utility monopolies, is certainly threatened by the growth of dispersed solar power generation. So SRP might just be trying to postpone their inevitable obsolescence as a monopoly. But there appears to be a lot more to it than that. The argument that solar customers should pay more to help maintain the electric grid was undoubtedly spawned from some conservative think tank because it’s the same argument that Arizona Public Service Company (APS) used earlier this year when it tried to impose a $50 to $100 fee upon its solar customers. Public outcry against the APS proposal prompted the Arizona Corporation Commission, which regulates public utilities, to reduce the fee to just $5 per month.
The fact that about $3.7 million in dark money was spent on advertising to try and get the APS solar fee approved provides a clue about who is really behind the anti-solar campaign. There isn’t much of a paper trail about where the money came from, but the old journalistic axiom of “follow the money” can still be applied. You just have to ask who benefits from the existing structure of the power industry so much that they’re willing to spend a lot of time and money to preserve it?
SRP customers who support the growth of dispersed solar power generation still have an opportunity to stop the implementation of the new fee. The SRP power district isn’t a public utility but a quasi-municipality so it isn’t regulated by the Arizona Corporation Commission. Instead, it’s run by a 14 member board that’s elected by its customers, and the board is accepting comments on the fee proposal and is expected to vote on it at their February 26 meeting.
On February 26, 2015, the SRP board voted to begin imposing an extra fee of about $50 per month on their customers who use solar panels.