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Arizona Corporation Commission Ruling Reduces Incentive For New TEP Solar
New Tucson Electric Power solar customers will get lower credits for excess solar-energy production and pay higher monthly meter fees under a long-awaited decision by the Arizona Corporation Commission on Tuesday.
Critics say the ruling will reduce the incentives solar had provided ratepayers and could cause the industry to collapse, according to reporting by the Arizona Daily Star.
The new rate plan, approved by a 3-2 vote, only applies to new solar customers.
For them, the ruling replaces net metering with a solar “export rate,” which is based on the cost of energy from solar farms over a five-year period. The commission’s ruling is in line with a statewide policy decision to end net metering, which reimburses solar customers for excess energy production at the full retail rate.
Tuesday’s ruling sets an initial TEP solar-energy export rate of 9.64 cents per kilowatt hour, compared with net metering at a retail rate of 10.8 cents, locked in for each customer for 10 years from when their systems go online.
The export rate will be reset annually based on a five-year rolling average of utility-scale solar costs, subject to a maximum 10 percent annual decrease.