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Panel should not treat solar firms as utilities

November 7, 2014

Many aspects of environmental and energy policy divide the authors of this column. But we join together to urge the Arizona Corporation Commission not to squelch an innovative approach to solar energy that benefits private and public entities alike.

At issue are solar-service agreements, in which solar companies install and maintain solar panels on schools and other tax-exempt organizations for free. The schools receive power for a low monthly fee over an extended period of time. The solar companies collect renewable-energy tax credits for which tax-exempt entities are not eligible.

Such solar-service agreements are a reality with unlimited potential in Arizona–but only if the commission decides in the coming days not to treat the solar companies as public utilities and subject them to costly and burdensome regulation. The likely effect would be to send the firms packing to other states that do not regulate them like utilities.

Solar companies are not utilities. They are not producing energy; rather, they are facilitators that enable private entities to generate their own energy. They assist entities that could not afford to construct solar facilities and that are unable to access the tax credits that otherwise could make such facilities economically feasible.

Schools across the state, which are copious consumers of energy, are anxious to reap the benefits of solar service agreements. The escalating and constantly gyrating costs of energy can play havoc with a school district’s budget.

The commission’s decision comes down to either expanding its power or accomplishing its renewable energy mission. In this instance, it can best achieve its mission by recognizing that these solar firms should not be treated as utilities.

Clint Bolick is director of the Goldwater Institute Scharf-Norton Center for Constitutional Litigation. Sandy Bahr is chapter director for the Sierra Club’s Grand Canyon Chapter. A longer version of this email ran in the Arizona Republic.

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Arizona Republic: Panel should not treat solar firms as utilities



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