Goldwater Institute Challenges $48.2 million APS Rate Charge

Phoenix–Late yesterday afternoon the Goldwater Institute asked the Arizona Supreme Court to strike down renewable energy regulations imposed by the Arizona Corporation Commission that will cost electricity customers millions. The lawsuit, Miller v. Arizona Corporation Commission, argues that the rules exceed the Commission’s limited constitutional authority, violate separation of powers, and impermissibly interfere with the relationship between APS and its customers.

“The rules are an unconstitutional power grab by an agency that is rapidly becoming Arizona’s fourth branch of government,” declared Clint Bolick, director of the Goldwater Institute Scharf-Norton Center for Constitutional Litigation. “Public policy regarding renewable energy should be set by the Legislature, not by an agency whose constitutional authority is limited to setting rates.”

The rules require utility companies to generate a minimum percentage of their power through renewable sources, many of which are unproven and expensive. To fund the mandate, last month the Commission approved rate surcharges for Arizona Public Service’s 1.1 million residential and commercial customers. Surcharges for other utilities have been or will be approved by the Commission, so that virtually every utility customer in the state will see increased bills.

APS estimates that its Arizona customers will pay $48.2 million this year and $100 million by 2012 in increased utility rates because of the rules.

The rules were passed last year over the dissent of the Chairman of the Corporation Commission, Mike Gleason, who argued that the Commission lacked authority to issue the rules. Despite finding that the Commission’s legal authority for the rules was “vague,” Attorney General Terry Goddard approved the rules.

“At a time when Arizonans are struggling to make ends meet, it’s important to prevent government from overstepping its bounds in ways that add costs to every family’s budget,” Bolick added.

The Goldwater Institute is a research and litigation organization whose work is made possible by the generosity of its supporters.