Proposed Energy Modernization Plan: Tribes and Clean Energy Proponents Can Likely Benefit

On January 30, 2018, Arizona Corporation Commissioner Andy Tobin proposed a new “Energy Modernization Plan” for the state of Arizona.  The proposed plan seeks to implement a comprehensive approach to develop  clean energy resources for Arizona’s electricity infrastructure.  Even though Tribes are not mentioned in the plan, Tribes and clean energy proponents should consider the beneficial implications the proposed plan could have on renewable energy, energy storage and clean energy infrastructure development, energy savings and economic development opportunities on tribal lands.

Policy Topics

As proposed the Energy Modernization Plan is comprised of eight policy topics: an updated policy framework to support clean energy; new clean energy deployment goals; energy storage; forest health and biomass; dispatchable clean energy; energy efficiency; electric vehicles; and energy planning.

1)         Policy Framework – An updated policy framework would build on the current Renewable Energy Standards and Tariff (REST) and expand it to a Clean Resource Energy Standard and Tariff (CREST), thus broadening the types of clean energy resources to include energy storage, energy efficiency and nuclear energy.

2)         CREST – Sets new goals to increase clean energy resources to 80% of the regulated utilities electricity generating portfolio by 2050.  Clean energy is defined as electricity sources with net zero emissions and energy efficiency.

3)         Energy Storage – Intended to promote system reliability and stability, the plan sets a target of 3,000 MW of energy storage by 2030.

4)         Forest Health and Biomass – The plan seeks to leverage sustainable treatment of forests – to reduce wildfire risk on at least 50,000 acres – to produce at least 90 MW capacity of biomass energy.

5)         Dispatchable Clean Energy – Adopts a proposal from the Residential Utility Consumer Office (RUCO) to implement a “Clean Peak Target” that incentives the use of renewable resources – including nuclear – for peak hour demand and ensures appropriate compensation.

6)         Energy Efficiency – implements a new energy efficiency policy, included in CREST, to continue energy efficiency efforts past 2020, when the current policy expires.

7)         Electric Vehicles – requires the regulated utilities to propose an electric vehicle infrastructure plan for new homes, existing homes, commercial and industrial customers, and on major highways.

8)         Energy Planning – will amend the Integrated Resource Planning (IRP) process to ensure the regulated utilities are in compliance, support and promote the policies in the proposed plan.

Guiding Principles

The Energy Modernization Plan also adopts several guiding principles for evaluating the implementation efforts of the regulated utilities. Those principles include:

  • Resiliency – deployment, innovative solutions to reduce peak summer demand, cyber and physical security.
  • Affordability and reliability – economies of scales, preservation of assets, customer sited technology
  • Innovation – coordinated statewide policy, grid optimization technologies, regional energy markets, electric vehicles
  • Economic development – fair and competitive rates, customer choice, international energy opportunities
  • Resource diversity – commitment to diversity.

Next Steps

The Commission discussed the proposed plan at its Open Meeting on February 6, where the Commission also took comments on the plan. While the Commission took no action on the proposal, the Commission has opened a docket – E-00000Q-16-0289 – to further consider the plan, including taking further comments.

With abundant renewable energy resources, available lands, biomass resources, and economic development opportunities (such as clean energy technology manufacturing), Tribes – who are unfortunately not mentioned in the plan – especially may have an interest in the adoption of this plan.

Tribe, clean energy advocates, and clean energy companies are encouraged to consider submitting comments on the plan to bring tribal energy interests to the attention of the Commission and work to ensure tribal resources, tribal communities and tribal lands are included in the plan.