SRP (Arizona POCO) hits solar customers with $50/month fee. APS next?

[HX_Guy]

I'm not too concerned about the trueup buyback rate, if I even overproduce anything, it would be very minimal and I suspect most people do not have over generation credit at the end of the year.

What does concern me are things like the "Appendix IIA Disclaimer" I had to sign which says that my system is subject to future rules and rates changes. The disclaimer is dated rev. 12/18/2013 so I assume anyone who applied for solar with APS after that date probably signed this same document. People prior to that date are the ones truly grandfathered in.

I'm also subject to the $0.70/kW fee that APS implemented last year. It's not a huge fee at the moment ($0.70 x 11.4kW AC = $7.98/month) but apparently it's a temporary fee while they look at what they should really be charging. What scared me most is the whole Demand thing which APS tried to already implement but were denied by the Corp Commission, but now with SRP going that route, I can see APS also getting approved on the next round. That can really be a killer, especially in a house like ours with 2 AC units...with both running, and then say turning on the oven for dinner in the summer...that will easily surpass 12-13kW of demand...and even if you do it just once, you're screwed for the whole month.

[Ian S]

Oh, and let's not forget how SRP does their trueup in April so that your ability to bank Kwh before the summer heat is limited. Of course after summer is over your excess production builds up over seven months so you can sell it back to SRP for $0.04/kWh. Nice!

[Ian S]

Ouch. Man I hope APS doesn't do something similar, but I have a feeling they will. Though people who already have it should be ok, so no need to really sweat it on my end I guess.

What a crappy time too with that Demand...I'd imagine there is a lot of stove, oven, and microwave use between 6pm - 8pm as people are eating dinner and solar isn't a factor.

Yeah, we don't have to sweat it, grandfathering can be pretty much assumed at least for a major change like that. But there are plenty of minor tweaks that APS could make that would be to our disadvantage e.g. they lowered the trueup buyback rate by half last year.

[HX_Guy]

Ouch. Man I hope APS doesn't do something similar, but I have a feeling they will. Though people who already have it should be ok, so no need to really sweat it on my end I guess.

What a crappy time too with that Demand...I'd imagine there is a lot of stove, oven, and microwave use between 6pm - 8pm as people are eating dinner and solar isn't a factor.

[Ian S]

The sales pitch for leases here in AZ is about saving roughly $50 per month...you save $600 per year and "lock in" your electric bill for the next 20 years. So yeah, a $50 hike basically gives you no saving.

Here is the thing though, it's not really a flat fee $50 like I assumed and like all the articles seem to allude to.
Here is the actual info from SRP, page 66: http://www.srpnet.com/prices/pricepr...ok.pdf#page=71

I only quickly scanned over it, but it seems this is very much TOU based and very much based on how much energy you're using from SRPs grid?
So does it then mean the people with the smallest systems will be penalized the most? You'll be "labeled" as a solar customer, so you are forced into this rate plan, but if your system is small and you still rely on the grid a lot, it seem like you'll be paying a lot vs if you have a big system, you'll pull very little from the grid?

And what if you are on a Standard plan and no a TOU one? Or one that has the Demand aspect of it...or are they forcing solar customers into a TOU plan with Demand?

All solar customers are forced into the new rate plan as I understand it. It is very similar to the "demand advantage" plan I was on before solar although I haven't actually compared the rates. Because the peak time extends to 8 PM when solar production will be negligible, that demand cost all depends on the solar customer's usage in that final few hours of peak time, IOW when the solar is not a factor. Easy solution: just don't use your electric water heater, dryer, swimming pool pump, stove, microwave or AC between 3 and 8 PM and you'll be good to go.

[J.P.M.]

At this point I would not touch a monthly lease in Arizona and I'd only consider a prepaid - if they still exist - if it made financial sense e.g. if the homeowner couldn't find a way to utilize the tax credits. Even then there's the new tax aspect to consider. But I'm not sure even purchasing makes a lot of sense in SRP territory any more especially if you're doing some kind of financing. Certainly, the payback time has significantly increased and a lot more getting into the weeds on your usage would be required: i.e. would you have a way to limit your demand charge during the late afternoon/early evening timeframe when the demand would be highest and production falling off to zero? I was actually on a combined TOU/Demand rate before going to solar - it actually saved me money - but you really had to be careful of that demand charge. One slip up and you're screwed for the whole month! Most folks would probably have to install demand controllers. The SRP demand charge is especially onerous as it's based on a half hour window not the one hour window I used to have.

Just a thought: Someone sharp and willing to understand POCO rates may be able to create a market for doing the customer dirty work and seeing if/how/when to giggle the system and/or optimize tariff plan choices, usage patterns or other things. Why the POCOs haven't already done that in an effective way and in so doing B.S.'d their way into calming some of the PR storm this is causing is something that escapes me.

[HX_Guy]

The sales pitch for leases here in AZ is about saving roughly $50 per month...you save $600 per year and "lock in" your electric bill for the next 20 years. So yeah, a $50 hike basically gives you no saving.

Here is the thing though, it's not really a flat fee $50 like I assumed and like all the articles seem to allude to.
Here is the actual info from SRP, page 66: http://www.srpnet.com/prices/pricepr...ok.pdf#page=71

I only quickly scanned over it, but it seems this is very much TOU based and very much based on how much energy you're using from SRPs grid?
So does it then mean the people with the smallest systems will be penalized the most? You'll be "labeled" as a solar customer, so you are forced into this rate plan, but if your system is small and you still rely on the grid a lot, it seem like you'll be paying a lot vs if you have a big system, you'll pull very little from the grid?

And what if you are on a Standard plan and no a TOU one? Or one that has the Demand aspect of it...or are they forcing solar customers into a TOU plan with Demand?

[Alisobob]

Before solar, my cost per kWh including taxes was $0.11 averaged over the entire year.

I think when its all said and done... My 20 years of solar production divided by the cost is something like $0.08 a KWH.

The $50 monthly charge ruins the AZ math.

[Ian S]

My system is on track to replace my historical SCE bill, aprox $3100 a year.

Say SCE starts charging $50 a month "Solar Fee".. like AZ might.

Thats $600 a year... I'm still ahead $2500.

We are likey exempt , grandfathered in as they say.

But for a newcomer to the game, I dont see it ending solar.

$2500 a year savings is still worthwhile.

Well, yes, a $50 monthly fee might not hurt so much in Cali but bear in mind, electric rates in AZ are far lower to begin with. Before solar, my cost per kWh including taxes was $0.11 averaged over the entire year.

[Alisobob]

My system is on track to replace my historical SCE bill, aprox $3100 a year.

Say SCE starts charging $50 a month "Solar Fee".. like AZ might.

Thats $600 a year... I'm still ahead $2500.

We are likey exempt , grandfathered in as they say.

But for a newcomer to the game, I dont see it ending solar.

$2500 a year savings is still worthwhile.

[Ian S]

I would also say that depending how the property tax hits me, I may just decide to purchase my system during that 7th year window provided for in my lease. My understanding is that the tax declines with system age so it may be relatively small for me. But then the purchase option is only about $850 so I'm very much undecided at this point.

[Ian S]

Understood. Thank you.
I'm not one to gloat, and I know you and I differ on leasing. While respecting your opinions, I'm of the honest opinion that some of the good, if any, that may come out of the AZ POCO shenanigans might be fewer people opting for leases and get screwed less, if only by their own ignorance.

At this point I would not touch a monthly lease in Arizona and I'd only consider a prepaid - if they still exist - if it made financial sense e.g. if the homeowner couldn't find a way to utilize the tax credits. Even then there's the new tax aspect to consider. But I'm not sure even purchasing makes a lot of sense in SRP territory any more especially if you're doing some kind of financing. Certainly, the payback time has significantly increased and a lot more getting into the weeds on your usage would be required: i.e. would you have a way to limit your demand charge during the late afternoon/early evening timeframe when the demand would be highest and production falling off to zero? I was actually on a combined TOU/Demand rate before going to solar - it actually saved me money - but you really had to be careful of that demand charge. One slip up and you're screwed for the whole month! Most folks would probably have to install demand controllers. The SRP demand charge is especially onerous as it's based on a half hour window not the one hour window I used to have.

[SunEagle]

Understood. Thank you.
I'm not one to gloat, and I know you and I differ on leasing. While respecting your opinions, I'm of the honest opinion that some of the good, if any, that may come out of the AZ POCO shenanigans might be fewer people opting for leases and get screwed less, if only by their own ignorance.

There has been a big push in Florida about allowing 3rd parties to sell power to someone besides the Utility. While that may get more solar installed I feel it will lead to Leases which I am not a big fan on.

[J.P.M.]

IMHO, the leasing model is on life support in Arizona and pretty much dead in SRP territory. Don't forget, the state treasury department has decided to extend a property tax to leased systems to the tune of another couple hundred $$ a year. Imagine that, a state government to whom taxes are anathema has finally found a tax to love! Technically, that tax is charged to the lessor but all leases I'm aware of provide for such taxes to be passed onto the lessee.

APS bought the newly elected members of the Corporation Commission so that body will be gleefully tripping over itself to institute similar $50/mo fees on APS and Tucson Electric solar customers. Add in the likelihood of interest rate increases over the next year or so and I expect all solar financing not just leasing will look unattractive by 2016. I just learned a homeowner in my HOA has gone with a lease but hopefully, they'll be grandfathered. Unfortunately, they are clueless on solar and have trusted the solar salesman to have their best interests in mind. SMH.

Understood. Thank you.
I'm not one to gloat, and I know you and I differ on leasing. While respecting your opinions, I'm of the honest opinion that some of the good, if any, that may come out of the AZ POCO shenanigans might be fewer people opting for leases and get screwed less, if only by their own ignorance.

[Sunking]

Unfortunately, they are clueless on solar and have trusted the solar salesman to have their best interests in mind. SMH.

Well Duh Ian, very few salesman or companies has the customers best interest at heart. Only ones that come to mind are Real Estate Agents and Auction companies working for the Seller. All salesman and businesses are in business to make as much money as they can possibly make. Solar contractors days are numbered and the party is over end of December 2016. After that they are out of business. So their goal right now is to rape the public and government out of as much money as they can before they close shop and retire wealthy sitting on the beach.