Lake Havasu City, AZ – Supervisor Buster Johnson submitted opposition today in regards to Unisource Electric’s rate structure case before the Arizona Corporation Commission. If approved, Supervisor Johnson strongly believes residents of Mohave County serviced by Unisource Electric could see their electric bill increase to nearly $30 a month with added demand charges. “Not only is Unisource asking the Corporation Commission to raise the base customer charge from $10 to $20 a month, they are asking them to add a third component to residential bills known as a demand charge,” Supervisor Johnson explained. “By doing this ratepayers will be charged based off their peak hourly energy use instead of only on their overall energy usage every month,” Johnson continued.
The case before the Arizona Corporation Commission held hearings in Tucson on Tuesday and is expected to hold an open hearing in Kingman on March 31st. The Commission will make a final decision regarding Unisource’s proposal in June. According to Johnson, demand charges, while a commonplace for commercial and industrial customers, are rare nationwide for residential consumers. “This extra high charge will be almost impossible for residential ratepayers to control unless they go out and spend hundreds of dollars on smart plugs and sensors to monitor activity such as how much energy output a crockpot or coffee maker is producing every hour,” Johnson stated. “Tying residential usage to the highest hourly energy use during a billing period does not make sense,” Johnson continued.
In Johnson’s letter to the Commissioners, he recommended that the Corporation Commission reevaluate the cost structure in relationship to alternative energy. “In 2006, the Commission required electrical utilities to obtain 15% of their retail generated energy from renewable resources by 2025,” Johnson explained. The Commission’s 06 ruling also required that the utilities obtain 6% by 2016. “By doing this, the Commission forced electric companies to use solar energy which is one of the most expensive forms of electricity out there right now,” Johnson explained.
According to research provided by the US Department of Energy, the cost of solar energy averages around 5.8 cents per kilowatt-hour. With the price of natural gas currently down, traditional electricity averages 3 to 4 cents per kilowatt-hour and nuclear energy averages 2.5 to 3 cents. “The 15% requirement is putting a financial burden on electric companies as they rush to meet this deadline,” Johnson stated. “If the Commission is going to demand that a certain percentage of electricity come from renewable energy, they should let the electric companies use the cheapest form out there which right now is clean nuclear energy. These companies shouldn’t be forced to only choose the most expensive which right now is green energy,” Johnson continued.
“On top of that, more folks are turning to solar to generate power as well as other means to save on electrical costs. If the Corporation Commission would relook at their 2006 ruling and lower state’s Renewable Energy Standard and Tarrif requirement, the burden on electrical companies would be lowered resulting in them keeping rates lower for customers. The 06 requirement was just another unnecessary government regulation that ended up hurting the residents of this state,” Johnson ended.