Arizonans Demand a Corporation Commission that Shields Consumers from Utility Monopolies

The Arizona Corporation Commission (ACC) is facing criticism for its perceived alignment with utility monopolies at the expense of consumers. Recent utility bills reflect a troubling trend, indicating that the commission is not acting in the best interests of Arizonans.

Under Arizona’s Constitution, the ACC is mandated to establish fair and just utility rates. However, allegations have surfaced claiming that it has repeatedly favored dominant utility companies, including Arizona Public Service (APS), Tucson Electric Power (TEP), UniSource Energy Service (UNS), and Southwest Gas. As a result, energy prices in the state have skyrocketed, placing Arizona among the highest in the nation.

Critics argue that the commission’s chairman has misrepresented the situation, asserting, “I am proud that Arizona has the second most affordable energy in all of the U.S.” Despite such claims, independent analyses suggest that Arizona ranked seventh in total energy prices and twelfth for residential rates in 2022. Recent rate hikes have exacerbated the situation, with Southwest Gas seeking an additional 12% increase on top of already high prices.

Comparisons reveal that the three regulated electric utilities charged consumers 28% more than SRP, which operates without commission oversight. This disparity is estimated to cost Arizonans an extra $1 billion annually. In fact, current electric rates exceed average prices in 38 contiguous states and are significantly higher than those in neighboring states like New Mexico and Utah.

Despite this, the ACC continues to circulate misleading statements regarding the cost-effectiveness of energy in Arizona, claiming that higher bills may lead to lower overall costs for ratepayers. When pressed for evidence supporting this claim, a commission spokesperson could not provide clarity, deferring to the utilities themselves.

Furthermore, while rooftop solar and energy efficiency programs have effectively reduced power demand, the commission seems to undermine their value. These initiatives have helped lower average household energy usage in APS territory despite rising temperatures. In 2023 alone, rooftop solar installations generated an impressive 3.8 million MWh, contributing substantial market value to the power grid.

However, for-profit utilities have expressed discontent with these programs, which threaten their profit margins. The commission has responded by imposing surcharges on solar users and weakening energy efficiency and renewable energy standards.

Adding to the concern is the rise of data centers consuming vast amounts of energy. These facilities are causing consumers’ bills to rise while diminishing the power grid’s reliability. For perspective, operating a 1,000 MW data center is akin to adding a thousand large grocery stores. Interestingly, APS charges residential customers rates that are three times higher than those applied to data centers.

This growing trend threatens to destabilize the power grid and increase electricity costs for everyday Arizonans. It is essential for the Arizona Corporation Commission to reevaluate its approach to utility management and prioritize the needs of the public over corporate interests.