ACC, insist that Arizona Utilities include more Clean Energy in their future plans

Every 2-3 years, Arizona utilities are required to submit “integrated resource plans” to the Arizona Corporation Commission (ACC), the elected body that sets electricity rates for Arizona Public Service (APS) and Tucson Electric Power (TEP). In its resource plan, each utility projects the needs of the electricity system over 15 years and proposes energy investments to meet those needs.

This year, both APS and TEP submitted resource plans that fail to value a clean energy future. Their plans are inadequate and rely heavily on natural gas generation. Please add your name to this letter and ask the ACC to insist that APS and TEP properly value energy efficiency and renewable energy in their resource plans.

- the Sierra Club

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Dear Commissioners,

Please consider our comments as you review the Integrated Resource Plans (IRPs) for Tucson Electric Power (TEP) and Arizona Public Service (APS). These IRPs should identify a path to meet future energy needs in a sustainable, reliable, and economic manner.

There are many troubling aspects to the APS IRP:

• In general, the APS IRP is systematically biased in favor of natural gas resources. This bias is reflected in an array of assumptions that exaggerate the need for natural gas plants and under-value alternatives such as renewable energy, battery storage, and energy efficiency. For example, APS includes no new utility-scale renewables in the first 5 years of its plan. Considering that we have some of the best solar resources in the county and that the cost of renewables continues to drop, this proposal is irresponsible
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• APS sales have been flat over the last decade, however it projects that sales will increase 1.8 percent annually between 2017 and 2032, even after accounting for energy efficiency and distributed generation. 

• Under APS’s selected portfolio, its annual incremental energy efficiency savings continue at their current, relatively strong levels of ~1.6 percent of sales through 2020. However, starting in 2021, APS’ energy savings drop to less than 0.3 percent of sales. Energy efficiency remains at these very low and troubling levels through 2032. This represents an 85 percent decline in annual savings levels.

The TEP IRP is also incomplete and fails to address risks to ratepayers:

• It fails to properly account for the potential benefits of expanded renewable investment. Consequently, ratepayers are exposed to unnecessary costs, environmental pollution and public health consequences. TEP should be required to rigorously model scenarios that account for expanded renewables and the full retirement of its coal fleet.

• The TEP IRP proposes a 2030 target to serve 30% of its load with renewable energy. While this is a good first step, action toward that goal only begins to materialize in 2025. TEP’s service territory sits in one of the richest renewable resource zones in the country. TEP’s delayed action means that it is missing the boat now on renewable energy opportunities. 

• TEP’s analysis undervalues energy efficiency. It accounts only for the upfront costs of efficiency without accounting for cost-saving benefits that energy efficiency delivers, including displaced fuel, reduced need for new capacity, transmission loss reductions, or emissions reductions. As a result, the TEP IRP effectively “over-prices” efficiency and fails to reflect its true value. 

The TEP and APS IRPs fail to adequately plan for investment in low-cost energy efficiency and Arizona’s abundance of low-cost renewable energy. It’s time to stop investing in the unstable fossil fuel industry that pollutes our air and water, harms our climate, and holds back the growing clean energy economy that will create great opportunities for future generations.

Please don't acknowledge these IRPs until these deficiencies are addressed.

Thank you.