May 30, 2012
The Arizona Corporation Commission (ACC) this month approved a settlement agreement from Arizona Public Service (APS) that gives ratepayers at least four years without a base rate increase, including a zero-percent bill impact for the average customer through the rest of 2012. The agreement takes effect July 1.
For example, under the settlement agreement, customers who use an average of 1,100 kWh a month will see their bills go down from $130.95 to $129.64. The factors for this slight decrease are the flat base rate for the remainder of the year, as well as postponement of a fuel charge reset that had been scheduled to go into effect this summer. As part of the settlement agreement, APS will delay that charge until February 2013 to keep customers from being impacted during the high usage summer months.
The base rate, which makes up about 95.5% of a customer’s bill, will be frozen for four years. The remaining 4.5% of the bill is from adjustor costs that fluctuate annually.
Also included as part of the agreement, which the ACC accepted with a 4-1 vote, is an alternate approach to decoupling that will allow APS to recoup its lost revenue due to efficiency programs but will still require the company to manage its own costs. This provision was fought for and agreed to by RCSC.
In addition, the electricity company will be allowed to pass on costs for its Four Corners coal plant to ratepayers in 2013 so long as the transaction for the plant is complete and the ACC finds all costs to be prudent. APS also will provide bill assistance for low-income customers.
The APS rate case has gone through 11 months of scrutiny by the Recreation Centers of Sun City, the ACC, and a variety of other stakeholders. The settlement agreement was approved with support from not only ACC Commissioners, but ACC staff, APS, and 20 other diverse constituency groups including RCSC and AARP.