The Inflation Reduction Act provides good incentives for folks to invest in rooftop solar systems – offering homeowners a 30% tax credit on the purchase of the system. That brings the ‘payback’ time way down from 11 years to 7 years at current utility rates (depending on the utility of course).
When rooftop solar people make more electricity than they need they can either buy a battery to store it or sell it back to the utility at something called a Rate Comparison Proxy rate (for APS ratepayers).
At the moment, APS rooftop people can sell their power back to the grid at $.07619 per kWh. The Arizona Corporation Commission currently allows APS to reduce that buyback rate by 10% per year.
Corporation Commissioner Nick Myers wants deeper cuts.
Last week he proposed an amendment that would cut APS’ buyback rate by an additional 37% starting this month. The new rate would only be $.053 per kWh. He eventually withdrew his Amendment from the August Agenda, but says he’ll be bringing it back in October. Myers believes “non-solar customers are subsidizing the solar compensation model.”
See Myers’ Proposal
People buy rooftop solar systems for many reasons. Some financial, some ethical and some for a combination of both. While the federal tax credit of 30% in the Inflation Reduction Act is an important factor, energy buyback is also a factor, especially when it comes to customers sizing their systems.
Achieving carbon neutrality to mitigate climate change will require a public policy full court press. Discouraging rooftop solar customers from investing in systems that generate more energy than they sometimes need reduces the clean rooftop solar energy that could be generated. We urge the Arizona Corporation Commission to vote no on Myers’ proposal should it be on the October agenda.