| LOS ANGELES
LOS ANGELES Nov 14 Proponents of solar power
will face off with Arizona's biggest utility on Thursday in a
last-ditch effort to sway regulators who are preparing to rule
on the fate of a little-known solar subsidy that, if altered,
would be a blow to the burgeoning U.S. rooftop solar industry in
one of its biggest markets.
The Arizona Corporation Commission's expected vote will be
watched closely by utility and solar players far beyond the
Grand Canyon State. That's because the two industries are
increasingly at odds over a policy known as net metering, which
allows homeowners with rooftop solar systems to sell the power
they don't use back to their utilities at retail rates.
The policy has buttressed the growth of rooftop solar
because it helps reduce the cost of going solar for homeowners.
But utilities say it has another impact: it shoulders citizens
who don't have solar panels with an unfair share of the cost to
maintain the electric grid.
The Arizona Commission's five-member panel kicked off a
two-day hearing in Phoenix on the issue on Wednesday, listening
to dozens of comments on the issue from members of the public.
The commissioners, who are elected, will weigh various proposals
on modifying net metering policies on Thursday before taking a
final vote on the issue.
Arizona became the nation's top battleground over net
metering when its biggest utility, Arizona Public Service,
earlier this year sought approval from regulators to either add
a charge to solar customers' bills or to lower the price at
which it will buy the excess power their panels generate.
The utility argued that the dramatic growth of residential
rooftop solar in its service territory - systems are being added
at a rate of about 500 a month - has shifted $18 million in
annual costs to non-solar customers.
Commission staff have recommended the panel take no
immediate action on net metering and instead evaluate the issue
during APS's next rate case in 2015 - a solution the solar
If the Commission adopts either of APS's proposals,
companies like SolarCity Corp, Sunrun and others who
finance or install residential solar systems could see the
critical part of their sales pitch - monthly payments on their
solar panels that are less than what they were paying the
utility company - erode significantly.
Not only would policy changes hurt the fast-growing market
for financed solar systems, they would also either extend the
payback period for consumers who lay out the roughly $20,000 to
$30,000 to own their solar panels outright, or force installers
of those systems to take a hit to their margins.
That would be a big setback to solar businesses in sunny
Arizona, which was the No. 2 state for photovoltaic solar
installations in the second quarter of this year. The state's
solar industry employs about 10,000 people.
The hearing in Phoenix mainly featured testimony from solar
system owners and company employees who said they were against
the APS proposals. The chief executive of SolarCity, the
nation's top solar panel installer, also made an appeal.
"The truth is APS is afraid of the competition and doesn't
want to give consumers the control," CEO Lyndon Rive said.
Some people testified, however, that they were concerned
about burdening low-income ratepayers who can't afford to go
solar with all the costs of maintaining the grid.
Challenges to net metering have cropped up in several
states, but it has yet to be rolled back in any of the 43 states
with such policies.
In Arizona, the two sides in the last few months have waged
high-profile ad campaigns to win over the public.
APS's parent company, Pinnacle West Capital Corp,
said earlier this month it had spent $3.7 million on lobbying
efforts tied to the net metering issue in Arizona.
The Alliance for Solar Choice (TASC), whose members include
SolarCity, Sunrun, Sungevity, Solar Universe, Verengo Solar and
REC Solar, had spent more than $335,000 as of Oct. 31 and
planned to spend an additional $100,000.