ARIZONA CORPORATION COMMISSION SAYS NO TO ELECTRIC DEREGULATION IN ARIZONA

In a sudden and surprising move, the Arizona Corporation Commission voted 4-1 Sept. 11 to close the docket on electric deregulation in Arizona.

The ACC’s decision was based on legal decisions that said the commission did not have the legal authority under the Arizona Constitution to open the markets to competition.

Phil Bashaw, Director of Government Relations and Grassroots Advocacy at Grand Canyon State Electric Cooperative Association (GCSECA), called it a “big win” for Arizona’s Electric Cooperatives.

“Co-op member/consumers scored a huge victory this week as the Arizona Corporation Commission voted to discontinue their consideration of deregulating Arizona’s electricity markets.  The 4-1 vote marked a significant victory for the Co-ops who advocated against the deregulation effort on behalf of their members,” Bashaw said.

“Rural electricity consumers faced an uncertain energy future under a deregulated market.  Other states that have experimented with deregulation have suffered significant price swings, above average energy prices and electricity shortages,” Bashaw said.

Commissioners, however, said they would look into opening new dockets to examine energy efficiency and technical issues even as proponents said they would continue to push for deregulated markets in Arizona, vowing to go so far as to seek a referendum on the Arizona Constitution that would give the ACC the ability to institute retail competition of electricity.

Bashaw said electric cooperatives and their members “stepped up to the plate” on the issue.

“We would like to thank all of our members who supported the cooperatives by signing the petition against deregulation.  More than 1,000 members of the non-profit, member owned electric cooperatives signed the petition against deregulation, sending a strong message from rural Arizona that deregulation is not in the best interest of the state,” Bashaw said.

Bashaw provided a set of deregulation ‘talking points’ that can be referred to in the wake of the ACC decision:

• Based upon the legal impediments to instituting retail competition in Arizona, the ACC

voted on September 11th to close the docket on retail competition.

• Their legal advisors stated that the court decision that invalidated many of the

previous provisions was clear on a number of legal constraints to ACC’s authority to

open the markets to competition. Those constraints included setting rates based on

fair market value, divestiture and mandatory participation in an independent

transmission operator.

• The ACC also decided to open additional dockets to examine innovations in the

electric industry within their constitutional authority.

• We look forward to working with the ACC as they investigate innovations in the electric

industry to benefit our consumers.

• We would like to thank the Corporation Commissioners and their staff for all of the

hard work and time spent on this issue. The decision by the Commissioners provides

economic certainty going forward for consumers and electric providers alike.

• We also want to thank our community organizations, local governments and consumer

owners for their interest and support throughout this debate!

• In the wake of the decision by the Arizona corporation commission, it appears that this

chapter of the debate is closed. It is important the we remain vigilant and we ask for your continued support as this issue may surface elsewhere