MANAGING ENERGY RESOURCES
February 27, 2018
Chairman, Arizona Corporation Commission
Arizona has a proud history of managing its essential resources to provide an attractive location to live, work, and recreate. We owe a great debt of gratitude to those who have gone before us and have paved a way to provide adequate water and energy to our residents and businesses. This has made an attractive environment to entice people to move to our great state for many years and we are working to make sure that this same appeal continues into the future.
As population in Metropolitan Phoenix continues to rise, the Arizona Corporation Commission is doing its part. No doubt it has been a very difficult task to take care of such needs given the harsh desert climate which provides very little water and exceptionally warm temperatures. The Corporation Commission is currently using a series of approaches to prepare for the energy needs of the growing population of our state, in particular the projected growth in the Phoenix Metropolitan area.
It is essential that electricity rates be as low as possible in order to help both the families who live here, as well as the many businesses that operate in Metropolitan Phoenix. Low electricity rates help families provide for their essential needs as well as potentially helping with necessary disposable income. Low electricity rates for businesses help to lower the cost of doing business, and therefore allow businesses a better environment to flourish. Proper electricity rates also help to assure that the necessary infrastructure is provided to make sure our growing population has safe and reliable energy.
The Corporation Commission is considering a comprehensive energy reform plan that would position our state to be the national leader in clean energy use and storage. On January 30, 2018 Commissioner Andy Tobin presented the Arizona Energy Modernization Plan (http://azcc.gov/energyplan) which calls for 80 percent of Arizona’s electricity generation to come from clean energy by 2050 along with the goal of having 3,000-megawatts of energy storage deployed by 2030.
Aside from economics, the Corporation Commission regularly requires the biggest electric utility companies to provide their forecasts and plans to meet the prospective needs to accommodate market trends and customer growth. The Corporation Commission will then assess the ways to meet and manage customer demand.
Sometimes growth means finding ways to properly generate more energy. Arizona continues to be a leader in renewable energy. Other states have looked to our policies for direction on how to best use the sun as a clean and abundant source of energy. The Corporation Commission is currently in the process of reconsidering our current energy portfolio. With technological advances in renewable energy and battery storage, as well as current market conditions for traditional sources of energy, it is timely to be taking another look as to how to best meet Arizona’s future needs.
Another very important aspect of meeting current and future needs for growing energy consumption is managing the demand for energy. It is crucial to be planning to meet demand at peak hours of the day when the maximum amount of energy is needed. The Corporation Commission regularly assesses current and future demand through a variety of ways. There are a number of methods which help to reduce demand, especially at critical times. Rate options many times are used to encourage high use of energy at times when demand is low to lessen the need to meet high demand when energy is costlier. Another great way to help lower demand is to be more efficient with the energy we are using.
Energy efficiency is an approach used to do just that — make the use of energy more efficient. Through new methods or technologies that have historically used more energy, we are now able to use less energy for essentially the same or similar tasks. The Corporation Commission regularly analyzes plans on how to make our use of energy more efficient in Arizona. One of the examples that I am most proud of is an energy efficiency project for schools that I have spearheaded during my tenure at the Corporation Commission. By making school’s use of energy more efficient, we have been able to save educators hundreds of thousands of dollars. This has allowed schools to put this money back to work in various ways to help our educators and students.
Planning for Arizona’s future is a task that includes efficiency, innovation, and economic transformation ideals. Working together, we will continue Arizona’s legacy of well-managed resources keeping our great state among the best places to be.