Arizona Solar-Power Initiative Ends, Peace With Utilities Begins in Doug Ducey-Brokered Deal

Plans for competing ballot measures on solar power were scrubbed this week as peace broke out in the battle between rooftop-solar companies, utilities, and Republican lawmakers.

Both sides in the debate over rooftop-solar payments agreed to sit at the negotiating table over the next two weeks in a settlement deal led by Governor Doug Ducey and his chief of staff, Kirk Adams.

The truce came at a critical time in the solar debate in Arizona: Rooftop solar-companies had launched a $3 million citizens-initiative campaign to lock in low rates for their customers for the next six years, and utilities got the state Legislature to agree to throw a spoiler bill on the ballot for virtually no cost or effort.

On Thursday, the solar companies' bill was withdrawn by Kris Mayes, chair of Yes on AZ Solar. State Representative Debbie Lesko (R-Peoria) announced at a news conference that she and Representative Don Shooter (R-Yuma) were withdrawing the two referendums they had sponsored.

"Over the next 10 days, some very important people will be attempting to put together the new energy future for Arizona," said a solar-company worker after the deal was announced.

If it's successful, the source said, it's likely to look similar to the proposal shaping up in New York, where a compromise between companies including SolarCity and investor-owned utilities would allow a more gradual ramp-down of solar credits for some customers over time while encouraging expansion by preventing heavy demand fees levied by utilities.

"The governor’s office is convening a negotiation process between both sides in hopes of reaching an agreement that takes Arizona in a positive energy direction and ends the controversy of recent years," said Daniel Scarpinato, Ducey's spokesman.

A solar-energy settlement would end the debate over the payments to rooftop-solar customers that has inflamed passions and infiltrated politics in Arizona over the past few years. The solar users are tethered to electric, and make money from a plan called net metering, in which they receive a retail price for the power they generate and sell to utilities.

The utilities, particularly Arizona Public Service, has been drawing heat for the way it's dealt with the issue — namely by pumping "dark money" into the campaigns of favored candidates for the Arizona Corporation Commission, which regulates the utilities.

Most states have some kind of net-metering program, and battles over the issue will continue in places like Nevada, where an initiative similar to the now-defunct one in Arizona is still under way.