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Put energy policymaking decisions back where they belong

November 4, 2014

National news headlines of companies like Solyndra and other government energy subsidies gone wrong are not the only stories of the renewable energy lobby bleeding taxpayers dry. For years, the same special interests have benefitted from the “Renewable Energy Standard” Rule (REST) implemented by the Arizona Corporation Commission, by which a certain percentage of the state’s energy portfolio must come from so-called “renewables.”

The Corporation Commission was meant to be in the business of regulating utilities on behalf of taxpayers, not driving up the costs of energy for taxpayers by subsidizing the latest fad in renewable energy.

HB 2789, a bill currently moving its way through the Arizona Legislature, seeks to return power to the taxpayers by restoring the constitutional balance of powers between the Legislature and the Corporation Commission.

Arizona’s framers intended regulation of utilities to be divided between the two entities, because they feared the possibility of special interests exerting influence to the detriment of consumers. In other words, they feared the situation Arizona finds itself in right now.

The opponents of HB 2789—namely, those who benefit from the REST mandate—are claiming the bill is unconstitutional because of an anomalous 2009 court ruling in Miller v. ACC.

In Miller, the Arizona Court of Appeals held that the REST Rules were sufficiently related to the Commission’s constitutional ratemaking authority. The judgment did not opine on whether REST Rules were within the Commission’s “permissive authority,” nor on the power of the Legislature to review such rules because the Legislature had not sought to exert such authority—in other words, what the Legislature is doing in HB 2789.

The Arizona Constitution gives the ACC authority over ratemaking and the Legislature power to regulate corporations. This has been affirmed in numerous cases. Miller, which wasn’t considered by the Arizona Supreme Court, stands in contradiction to that long and unbroken line of cases.

HB 2789, like many others, seeks to overturn or limit an erroneous court decision and return fiscal sanity to the Arizona Corporation Commission.

Learn more:

Arizona State Legislature: HB 2789

Goldwater Institute: Miller v. Arizona Corporation Commission



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