In a key regulatory step, staff at the Arizona Corporation Commission issued a notice of inquiry Thursday into a proposal to overhaul the state’s power sector by requiring utilities to get at least 80 percent of their power from zero-carbon resources by 2050 while deploying 3,000 megawatts of energy storage by 2030.
Parties have 60 days to comment on the proposed energy modernization plan, which was offered by ACC Commissioner Andy Tobin after a series of workshops held over the last 18 months.
Once ACC staff has reviewed the comments on the plan, a rulemaking package would be put together for public comment, Elijah Abinah, ACC utilities division director, said during a Thursday meeting.
If the rulemaking proposal is straightforward, the review process could take a year to 14 months to complete, according to Sarah Harpring, an ACC administrative law judge. If it is more complex it could easily take a year and a half, she said.
However, if the proposed rule is reviewed under an emergency process, it could be quicker. Tobin, who wants the process finished by the end of this year, said Arizona is facing an emergency from the risk of forest fires. One element of the energy plan aims to reduce debris in the state’s forests by requiring utilities to jointly buy the output from 60 MW of biomass.
Tobin recently submitted a letter in the energy plan docket at the ACC in which he said that he wants the state Residential Utility Consumers Office to conduct an audit and cost-benefit analysis of the energy plan. Tobin asked RUCO to compare the plan with utility long-range resource plans and a recent ballot initiative that seeks to increase Arizona’s renewable portfolio standard to 50 percent by 2030.
Through the notice of inquiry, ACC staff is seeking information on the cost and benefits of the proposed energy plan and how it would affect ratepayers. Staff also want to know about energy storage, if the proposed storage goal is realistic and whether the commission has the authority to issue a biomass mandate.
Other questions include whether and how the plan should apply to municipal utilities, cooperatives and quasi-federal entities.
The proposal calls for broadening the state’s RPS, which climbs to 15 percent by 2025, and renaming it the Clean Resource Energy Standard and Tariff. The proposal doesn’t mandate specific targets utilities must meet in moving towards the overall 80 percent clean energy goal.
Eligible resources under Tobin's plan are zero-emission resources, including energy efficiency.
The proposal includes a “clean peak standard” that aims to increase the amount of zero-carbon resources that are used to meet peak demand.
Under the proposal, utilities would establish a baseline for how much zero-emission resources are meeting peak demand and then increase that amount by 1.5 percent a year on average through 2030.
Arizona would extend its energy efficiency requirements, which expire in 2020, under the proposal.
The proposal also requires utilities to develop plans to expand electric vehicle charging infrastructure.