Wind Development is a Property Rights Issue

This piece first ran in the Akron News Reporter on August 8, 2021:

By Greg Brophy

As technology advances our rural landscape changes.  Just as wooden oil derricks were once a common site in the early 20th century but then gave way to modern drilling rigs, wind energy has advanced from its early iconic windmills used to pump water to today’s utility scale turbines capable of generating 3MW of electricity. 

If we attempt to prevent this change through government regulation we need to do so with a full understanding of the implications.   Currently Washington County has a set of proposed ordinances that intend to limit wind energy development but in practice would completely ban any utility scale wind development in the county.  

The proposed restrictions in Washington County include a 410 foot height limit on turbines, a 1.25 mile setback from neighboring homes, and a .5 mile setback from property lines.  Each of these individual restrictions could potentially prohibit all wind development but taken as a package there would be virtually no chance of future development in the county. 

Nearly every modern wind turbine exceeds the proposed height, almost all turbines being built today are 480 feet or taller. New turbines planned for the next two to five years will be even taller because more consistent and powerful wind resources are typically found at greater heights.  The taller the tower the more efficient and cost effective the turbine is to operate.  It’s almost the same as insisting that no one use wheat heads in Washington County that are wider than 20 feet.  They technically work, but no custom harvester is going to show up in WashCo with a head that small.

Both the setback of 1.25 miles from neighboring homes and a .5 miles setback from property lines creates serious implications for landowners and their rights to use their property as they deem most productive.  The 1.25 mile setback essentially gives small acreage land owners control of a 1.25 mile radius of land, or 3,100 acres, surrounding their property; they would control land that they do not own.  The .5 miles setback from property lines would require a landowner to own tens of thousands of contiguous acres that are not broken up by county roads.  An owner of a 1 mile by 1 mile section would be prohibited from putting up a turbine because when taking into account the diameter of the turbine footprint, a turbine in the exact center would push into the .5 mile exclusion.  Taking both of the setback requirements together would be a de facto ban on wind anywhere there are houses or property holdings intersected by county roads. 

When the Governor from Boulder pushed oil and gas setbacks that were de facto development bans, Eastern Colorado rightly and resoundingly said “no”.  There should be no difference this time around just because the energy source has changed.  Energy development is a common use of land in eastern Colorado and it should be the landowner’s choice to develop, not the government’s.

I trust that the Washington County Commissioners will do what is in the best interest of the citizens of the county.  I sincerely hope that they understand that the current restrictions are effectively a ban on wind development and approving the restrictions will have serious consequences.  Washington County will lose out on tax revenue (paid mostly by people in Denver and Boulder), landowner lease payments and much needed economic activity and local jobs.  Just to the south, Kit Carson and Lincoln counties’ renewable energy facilities generate annual county and district tax revenue of $3.7 million and $2.8 million respectively.  This revenue can be used at the county and special district’s discretion and will remain a constant source for at least 20 to 30 years without price fluctuations.  Landowners in Kit Carson and Lincoln counties who lease their property to house turbines are estimated to earn up to $10,000 per year per turbine.  Across the Eastern Plains it is estimated that landowners receive $15.2 million annually from renewable energy leases which flows into local economies benefiting the entire region. 

Washington County has every right to draft land use requirements as it sees fit but the commissioners must balance the rights of landowners to utilize their land for its highest productive use and should be cautious when approving a ban in the guise of a restriction.  The wind development that will happen in the next five years may never be repeated.  If you miss out on this chance, there is no guarantee that you will get another.

Greg Brophy is a former state legislator from the Eastern Plains and the Colorado director of The Western Way (www.thewesternway.org), a conservative nonprofit that seeks pro-market solutions to environmental challenges.

TWW Congratulates Conservative Clean Energy Champions

The Western Way highlighted and congratulated the following elected officials from the Western United States for being named 2021 Conservative Clean Energy Champions by the organization Conservatives for a Clean Energy Future (CCEF).

Conservative Clean Energy Champions are state and local policymakers who have shown consistent and exceptional support for conservative policy initiatives that promote renewable energy and energy efficiency. Champions have worked on issues ranging from net metering and third-party ownership to energy efficiency, renewable siting, and more, to make clean energy technology more accessible to ratepayers.

Congratulations!

 
 

Arizona Lands 1 Million Square Foot Battery Manufacturing Facility

Arizona continued to build on its leadership as a preferred home of the fast growing EV manufacturing sector this month with the announcement of Kore Power’s massive manufacturing facility. Kore Power is a leading battery cell technology company and will be building a 1 million square foot facility in Buckeye. The “KOREPlex” will employ 3,000 employees at or above a median salary of $51,000.

“Arizona is thrilled to be selected as the home of the country’s first U.S.-owned lithium-ion battery manufacturing facility,” said Governor Doug Ducey. “Not only will this facility create thousands of new jobs, it will position Arizona as an anchor in the global battery manufacturing supply chain. We’re grateful to CEO Lindsay Gorrill and the entire KORE Power team for choosing our state. We look forward to partnering in your success for many years to come to further sustainability here in Arizona around the world.”

The KOREPlex, will support up to 12 gigawatt hours (GWh) of battery cell production to ensure a reliable and independent U.S. supply chain for lithium-ion battery cells that are critical to the future of electric vehicles, power grids and more. The facility will have the capacity to produce enough power for 3.2 million homes each year. KORE plans to start construction of the facility by the end of the year with the goal of beginning production in Q2 2023.

“We needed a location for our factory that had a track record of supporting energy storage, a growing clean transportation sector, and a workforce that could deliver American-made battery technology that the supply chain so desperately needs,” said Lindsay Gorrill, KORE Power CEO. “Arizona hit a home run. We’re fully committed to be a cornerstone of the state’s clean economy and we’re proud to bring advanced cell manufacturing home to the U.S.”

Arizona is a Hotbed for Clean Energy Innovation

Arizona is a hotbed for clean energy innovation. Arizona’s entrepreneurial business climate, coupled with the high quality of life and relatively low cost of living, has drawn both highly skilled workers and the innovative companies who need them. From electric vehicle companies to microchip manufacturers to large businesses with robust clean energy and sustainability goals, more and more companies now call Arizona home. According to the Arizona Commerce Authority, between 2015 and 2020 at least 634 companies have relocated or expanded in Arizona. Among them are electric vehicle manufacturers Lucid Motors, Nikola Motor Company, ElectraMeccanica, and Atlis Motor Vehicles, who together are changing the future of the motor vehicle industry. And, amid a global semiconductor shortage, Arizona will now be home to three major semiconductor factories, including major expansions by Intel and Taiwan Semiconductor Manufacturing Co.  

In addition, just this month Microsoft launched a long-awaited data center region in Arizona, made up of three separate facilities just outside Phoenix. The company said it chose Arizona for its facility because of its “abundant solar energy, highly skilled workforce, proximity to our customers, and availability of land.” In order to meet its corporate sustainability goals, Microsoft’s new facilities will use a combination of solar power, renewable energy certificates to offset energy use, and adiabatic cooling, which uses outside air instead of water cooling when temperatures are below 85 degrees. In particular, the facilities will be using solar panels from Arizona company First Solar, which uses an innovative process for solar panel manufacturing that is more energy efficient, uses less water, and creates panels that are designed to be recycled. Microsoft will also be participating in water conservation efforts to balance its current and future water use.

These are but a few examples of how Arizona’s entrepreneurial business climate has attracted companies focused on clean energy innovation, with positive impacts for Arizona’s economy, workforce, and environment. With this kind of momentum and commitment from Arizona’s leaders at all levels, Arizona’s drive to lead the innovation economy is sure to continue.

145 MW Panorama Wind Farm to Create 185 Jobs in Colorado

US-based renewable energy company Guzman Energy has signed a power purchase agreement (PPA) with Leeward Renewable Energy for the Panorama Wind Farm in Weld County Colorado.

The 145MW wind farm will be Leeward’s third project in Weld County. In its construction phase, the project is expected to create a total of 185 jobs and will also support jobs at Vestas manufacturing sites located in Colorado.

Guzman Energy CEO Chris Riley said:

“Electric cooperatives, municipalities and tribes are clear that they want access to affordable, reliable and clean energy.

“The Panorama Wind Farm will be an important source of power for our current and future customers in Colorado, New Mexico and Wyoming who are seeking reliable power at reliable prices.

“It makes strategic sense for Guzman Energy to be part of the Panorama Wind Farm as we continually leverage both owned and contracted energy sources to meet our customers’ needs.”

Vestas, with factories based in Colorado, will provide a mix of 2 MW platform turbines including V120-2.2 MW, V110-2.2 MW, and V110-2.0 MW turbines.

“We’re proud to once again partner with Leeward Renewable Energy on a project that extends the successful run of Vestas’ 2 MW platform in the state,” said Jeff Fuchs, Vice President of Sales for Vestas in North America. 

“Leeward is pleased to partner with Vestas and deliver sustainable wind energy and economic benefits to the people of Colorado,” said Andrew Flanagan, Leeward Renewable Energy’s Chief Development Officer. 

The order includes supply and commissioning of the turbines, as well as a 20-year Active Output Management 5000 (AOM 5000) service agreement, designed to ensure optimised performance of the asset. 

Construction work at the site is expected to begin next month and turbine delivery will begin in the third quarter of 2021 and construction is expected to be completed in December 2021. 

TWW Supports Colorado's Innovative Energy Projects Legislation

TWW's Greg Brophy testified in support of HB-1324 which was heard this month at the Colorado Capitol. The bipartisan bill focuses on creating a framework within the Colorado Public Utilities Commission to drive innovative energy projects from research and development into commercialization. Specifically it would allow Xcel Energy to propose innovative energy technology projects that can deliver the next generation of clean energy while being located in rural communities impacted by energy transition in order to provide tax revenues and jobs.

The bill aims to achieve several goals:

  • Spur innovative energy technology projects which attract and retain new business, workforce development, and economic growth in areas impacted by the clean energy transition.

  • Create industry and public-private partnerships critical to achieving zero-carbon electricity. 

  • Develop a regulatory framework to attract federal and other public funding/grant opportunities to support innovative technology and robust investment in rural areas impacted by the rapid transition to clean energy.

Several guardrails have been included in the legislation to ensure proper ratepayer protection and follow the current system of PUC approvals and reviews:

  • Location:  Projects must be located in communities impacted by energy transition to facilitate an active role in the clean energy transition, replace tax revenue displaced by the early retirement of fossil generation and utility workforce transition opportunities.

  • Timing: Projects can only be proposed as part of Xcel Energy’s current Electric Resource Plan (ERP).   Legislation sunsets in 2024.

  • Cost:  Projects are be competitively bid within the ERP and under an existing retail rate impact established within SB19-236; prioritizes a portion of that overall investment to areas impacted by the plan.

  • Size:  Projects cannot exceed a negotiated amount of 300MW in size.

  • Approvals:  Projects must gain approval by the Public Utilities Commission (PUC) with consideration to both clean energy goals and the advancement of community and workforce transition. 

Arizona Moves Closer on Energy Rules Modernization

The Arizona Corporation Commission (ACC) voted on May 26th to advance the rulemaking process for the state’s Energy Rules.  The rules have been the subject of ongoing debate and an open docket of work for nearly three years. Amendments made to the rules will require a public comment period that will be open until August 20th. After that date and after the results of a costs analysis, the ACC will take a final vote on the package. 

Several amendments were adopted during the May 26th Special Open Meeting, the result of the compromises made between Commissioners which helped to win the necessary 3 votes (Kennedy, O’Connor, and Tovar) to advance the rules package. Notable among the amendments was a joint amendment from Commissioner Anna Tovar and Commissioner Jim O’Connor which extended the deadline by which utilities must reach 100% carbon-free emissions from 2050 to 2070, with interim standards beginning with a 50% reduction by 2032, a 65% reduction by 2040, an 80% reduction by 2050, and a 95% reduction by 2060.

Commissioners Tovar and O’Connor offered three additional amendments which were adopted that will add a Ratepayer Impact Measure Test, make changes to the portfolio options utilities must put forth in their Integrated Resource Plans, and add the definition of ‘All Source’ which includes supply-side and demand-side resources.

Chairwoman Lea Márquez Peterson also offered an amendment which was adopted that will allow a utility to seek a fair return on the fair value of the reasonable and prudent, used and useful investments made in demand-side resources, such as energy efficiency and demand response.

Commissioner O’Connor said before the vote:

“I think 100% is a smart target to shoot for, but I really believe the industry needs more time to get there. That implies flexibility and again most importantly leaves the utility companies in control of how they construct their energy portfolios. Let’s have them shooting high. Hopefully in the decades to come there will be very smart public servants in these jobs holding utilities accountable."

Arizona Public Service Company and Tucson Electric Power are already on track to reduce emissions ahead of the new targets.  APS plans to be carbon free by 2050 and TEP has announced an 80% carbon free goal by 2035.  

TWW has supported the updating the Energy Rules which go beyond emissions reductions and include an updated energy efficiency standard, battery storage policies, and important updates to the Integrated Resource Plan and purchased power agreement processes that will introduce more transparency and competition.

 

EV Manufactures are Choosing AZ for a Reason

AZ State Senator TJ Shope recently published the piece below in the Phoenix Business Journal. Shope highlighted Arizona’s recent successes attracting new EV companies driving advanced manufacturing jobs for the state.

The piece originally ran on May 18, 2021 and can be accessed here.

Electric vehicle makers aren't choosing Arizona by accident; let's keep it that way

 By Thomas “TJ” Shope

May 18, 2021, 3:01pm EDT

Arizona has long been a favored location for advanced manufacturing, with tech companies like Boeing, Intel, Footprint and others manufacturing everything from medical devices and space vehicles to semiconductors and plant-based materials here. In the past few years, Arizona has begun to attract a new and important category of manufacturers — those in the advanced vehicle industry — as companies including ChargePoint, Waymo, Lucid Motors, and Nikola Corp. have set up operations. These companies are developing and manufacturing products in Arizona that represent innovative technological breakthroughs that are changing the world, and they are creating tens of thousands of high-paying manufacturing jobs here at home. 

The recent announcements by Electrica Meccanica, a designer and manufacturer of electric vehicles, and UACJ Automotive Whitehall, which manufactures electric vehicle components, to bring their operations to Arizona cements this state as a hub of next generation transportation innovation and manufacturing. As Gov. Ducey pointed out, “Arizona has fast become the electric vehicle center of America thanks to our robust and growing workforce, vibrant innovation ecosystem, and ideal business environment.”

This is great news for people excited about clean energy and looking for more EV options of course, but it is also great news for Arizona’s workforce and economy. 

Big investments

UACJ plans to invest $60 million in northern Arizona. Its manufacturing operation in Flagstaff will bring 120 high-paying jobs to the region in the first year and up to 350 jobs within five years, with an average wage that is 60% higher than the county per capita income. Calling the announcement a “historic investment for Northern Arizona and our entire state,” Sandra Watson, President and CEO of the Arizona Commerce Authority, noted that, “UACJ Whitehall will further bolster Arizona’s reputation as a global hub for electric vehicle manufacturing.”

The same is true for the new Electrica Meccanica facility in Mesa, where the company plans to ramp up production on its new flagship SOLO EV. The facility, which will include both a light vehicle assembly plant and a state-of-the-art engineering technical center with multiple labs for research and testing workshops, will be able to produce up to 20,000 vehicles per year and will create up to 500 new jobs once fully operational. 

It’s not surprising that more tech companies like UACJ and Electrica Meccanica are choosing to call Arizona home. Our culture of innovation and entrepreneurship, vibrant workforce and business-friendly environment create opportunities for strategic investment that bring jobs and capital to the state. 

This is not by accident. Arizona’s leaders and policymakers have prioritized economic development, ensuring the state is positioned to meet the needs of the tech and advanced manufacturing industries.

Policy framework

But part of their success is also certainly due to having a policy framework that supports technology, innovation, and advanced manufacturing. As Arizona’s policymakers continue to engage on energy policy — whether to modernize clean energy goals, encourage more widespread adoption of energy efficiency measures, create an integrated statewide EV infrastructure plan, or fund programs that enhance the talent pipeline from Arizona’s higher education system into advanced manufacturing and tech jobs — it is essential that policymakers take a careful and mindful approach.

I recently sponsored legislation (SB 1291) that is critically important for advanced vehicle manufacturers, who are building and deploying innovative vehicle technologies here in Arizona. The bill creates parity between battery-electric/fuel cell electric vehicles and natural gas vehicles and it provides needed uniformity between state and federal policies, which is critical for market certainty. The bill passed with overwhelming support in both the House and Senate and Gov. Ducey quickly signed it into law, demonstrating yet again his commitment to Arizona’s tech manufacturers and ensuring Arizona is a hub for innovation. 

Just as good policy will continue to encourage tech companies to locate here in Arizona, bad policy will encourage them to look elsewhere. 

Arizona Sen. Thomas "TJ" Shope, a Republican, represents District 8.

AZ Legislature Passes Important Bill for Advanced Vehicle Manufacturers

Last week, an important piece of legislation for Arizona’s advanced vehicle manufacturers cleared its final hurdle in the State Legislature and was transmitted to Governor Ducey for signature. SB 1291, sponsored by Sen. TJ Shope, modifies Arizona law by adding battery-electric and fuel cell electric vehicles to the section of Arizona code related to heavy duty vehicle gross weight and load limitations. The bill also updates Arizona’s state weight exemption language to parallel federal exemption language, and it extends that exemption to alternative fuel types.

The bill passed through the State Legislature with little fanfare or outside attention but that belies its importance to Arizona’s advanced vehicle manufacturing industry, which has seen rapid growth in the past few years. Nikola Corporation, for example, is developing and manufacturing advanced vehicles—specifically heavy-duty hydrogen fuel cell vehicles—in Arizona that represent innovative technological breakthroughs that are changing the landscape of the automotive industry and turning Arizona into a global leader in alternative fuel vehicles.

That companies like Nikola and others have chosen to locate and expand operations in Arizona is due in no small part to the entrepreneurial climate of innovation that is present here. But in order to continue to attract and support advanced manufacturers, Arizona must have a policy framework that supports these priorities. SB 1291 is critically important for advanced vehicle manufacturers like Nikola because it creates parity between battery-electric/fuel cell electric vehicles and natural gas vehicles, which already enjoy a weight exemption under existing statute, and it provides needed uniformity between state and federal policies, which is critical for market certainty.

Governor Ducey has demonstrated his commitment to supporting Arizona’s advanced manufacturers and specifically the advanced vehicle industry, and we hope to see his signature on SB 1291 soon.

Utah is an "all of the above" Energy State

Utah’s Thom Carter, Energy Adviser to Governor Spencer Cox, recently authored a piece for the Deseret News which highlighted why the so called “keep it in the ground” concept is not a serious energy policy for Utah or our country. Carter makes the case for the importance of utilizing all of our energy resources while cleaning up emissions.

Mr. Carter is right in pointing out how Utah’s abundance of natural resources from fossil fuels and critical minerals to geothermal and other renewable sources has allowed the state to benefit from “affordable, reliable, diverse and durable energy.”

Mr. Carter also hits on the critical contribution that Utah’s mining industry makes to advanced energy solutions. When extremists argue to “keep it in the ground” they do not understand the complexities of our modern economy.

How do you turn solar energy into solar power and wind energy into wind power? Honestly, through critical minerals. According to the U.S. Department of the Interior, there are 35 mineral commodities that are used in the creation of solar panels. These minerals “transform the sun’s energy into electricity.” Both aluminum and rare-earth elements help turn wind into wind power in the development of wind turbines. Batteries and battery storage are key to the long-term success of renewable energy because they allow the power generated by wind and solar to be stored. This transformative technology relies on cobalt, graphite, lithium and manganese.

Utah’s common sense “all of the above” energy strategy is a prime example of how states can build their economies while balancing environmental concerns.

Read Mr. Carter’s full piece here.

Lawmakers don't have the power to mess with utility regulators' clean-energy rules

This piece from Arizona Technology Council’s Steve Zylstra and TWW’s Doran Miller first ran in the Arizona Republic on April 12, 2021, and can be accessed here.

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Lawmakers don't have the power to mess with utility regulators' clean-energy rules

Opinion: Bob Robb is wrong. A 2020 ruling by the Arizona Supreme Court says state lawmakers lack the power to decrease regulators' constitutional authority.

Steven G. Zylstra and Doran Miller

Arizona Republic columnist Robert Robb suggests the state would be best served by maintaining an outdated clean-energy standard set in 2006, and that the Arizona Corporation Commission (ACC) lacks the authority to update the standard at all.

Robb’s column (“Arizona Legislature can (and should) override regulators on clean energy mandates,” March 17) misses the mark completely.

He mischaracterized the Arizona Supreme Court’s holding in Johnson Utilities and the nature of the Corporation Commission’s constitutional powers. Additionally, he fails to recognize the many ways in which modernizing our clean-energy rules will benefit Arizona ratepayers, communities, the economy and environment.

Robb is correct that the bills being considered in the Legislature would freeze Arizona’s current energy standard by placing it in statute and forbidding the Corporation Commission from going further.

He is wrong that doing so is a good thing.

Businesses want certainty, stability

Not only do these bills represent an unconstitutional power grab by the Legislature, they also create an uncertain regulatory climate for businesses. That poses risks of losing needed economic development opportunities and crucial jobs.

Because availability of clean and renewable-energy resources is often a deciding factor for locating in a particular state, companies considering Arizona for relocating or expanding their presence would not have the market stability and certainty they require.

That’s why so many companies have supported the commission’s energy rules package: Recently, more than two dozen businesses and business associations, including Ball Corporation, Google, Microsoft, REI and Salesforce, signed a letter in support of the 100% carbon-free and efficiency standards.

The potential for instability and uncertainty arising should these bills pass is the reason a broad-based coalition of businesses, economic development organizations, utilities, clean energy providers, manufacturers, electric vehicle companies and many others oppose these measures. 

The commission can make these rules

Robb also fails to understand the holding in Johnson Utilities v. Arizona Corporation Commission, a landmark Arizona Supreme Court case decided in July 2020 that outlined the ACC’s authority as set forth in the state constitution.

The constitution grants the commission’s broad authority to regulate public service corporations and breaks it down into two buckets: exclusive authority over ratemaking and permissive authority to make and enforce rules and regulations for the “safety and health” of the public, which the ACC holds concurrently with the Legislature.

Promulgating rules that will reduce carbon emissions, improve energy efficiency and increase the adoption of renewable resources – all of which directly relate to improving air quality and the health of the environment and Arizonans – is squarely within the Corporation Commission’s constitutional power to regulate for public health and safety.

While lawmakers can set energy policy via statute, they lack the power to decrease state utility regulators’ constitutional authority; indeed, as the Supreme Court explicitly stated in the Johnson Utilities ruling, “The legislature lacks the power to decrease the Commission’s constitutional authority.” 

In other words, the Legislature cannot simply forbid the commission from regulating.

We can't afford this potential instability

Yet, that is exactly what lawmakers are trying to do. The language of the bills before the Legislature, by their very terms, attempts to abrogate the constitutional authority of the Corporation Commission by stipulating that it “may not adopt or enforce a policy, decision or rule that directly or indirectly regulates” electric generation resources or carbon emissions. 

Clean and renewable energy technologies have come a long way since 2006, while at the same time experiencing an exponential drop in generation costs. In that time, Arizona has become a hub of technology and innovation, and a leader in the development of clean and renewable energy technologies – a boon for Arizona’s economy.

Even without reference to actual rules being considered by the Corporation Commission, it is simply foolish and regressive to suggest Arizona should be operating under a clean-energy standard set before some of these new technologies were even developed and when the cost of generating clean energy was much higher.

Although we support the Legislature having a role in energy policy, these bills simply miss the mark. Our state’s economic growth requires stability and certainty, which means we need to get this right the first time. 

Let’s take the time to do it right.

Steven G. Zylstra is president and CEO of the Arizona Technology Council. Doran Miller is state director of The Western Way. Reach them at szylstra@aztechcouncil.org and doran@millerpolicyconsulting.com.

TWW Interviews Colorado State Senator Ray Scott

TWW’s Colorado State Director Greg Brophy spoke with Colorado State Senator Ray Scott (SD-7) about his approach to energy policy and his request for an interim committee to look at small scale nuclear and hydroelectric energy options.

Sen. Scott spoke about his long tenure in the legislature on committees of reference which discuss energy policy. Sen. Scott also discussed how conservatives can engage on environmental issues by offering pragmatic solutions.

Sen. Scott recently authored an opinion piece that ran in the Denver Post arguing that:

Humans have an undeniable effect on the environment via our emissions. Period. That may sound like a surprising statement coming from a Republican elected official, but facts are facts and science is science. Republicans in the state legislature are willing, ready, and able to put forth bold, free-market based solutions to help tackle environmental issues, diversify our power grid with reliable, emission-free solutions, and leave our state’s air, water, and land in better shape than the way we found it.

There are those that claim that the idea of climate change is a hoax — perhaps concocted by the Chinese. There are also those that claim that we must consider banning air travel, overhaul every building in our nation, and potentially phase-out the entire beef industry. Both opinions are radical, nonsensical, and should be rejected by our elected officials.

Arizona needs new, innovative ways to produce energy

This piece from TWW originally ran in the Arizona Capitol Times on April 1, 2021 and can be accessed here.

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Arizona needs new, innovative ways to produce energy

Arizona has a long history of innovation and entrepreneurship that has helped us grow from a Western outpost into a robust and thriving economy. While Covid has obviously had an impact, we are well-positioned for a strong recovery, in part because of the strength of Arizona’s clean energy, technology and innovation sectors. As we focus on our economic recovery efforts, it is essential that we identify and implement opportunities to support these sectors, which continue to diversify our state’s overall economy.  

With that in mind, last fall The Western Way partnered with the Arizona Technology Council to convene a group of stakeholders working at the forefront of technology and innovation here. Together, the group identified key policy priorities that, if implemented, can supercharge Arizona’s economic recovery and cement our state as a national leader in clean and renewable energy technology and innovation. Our joint report released in December 2020 gives policymakers a roadmap for incorporating the technology and energy innovation sector into Arizona’s economic recovery plan. We are so pleased to see two of our recommendations mirrored in bills currently before the state Legislature.  

 HB2153 sponsored by Rep. Tim Dunn, R-Yuma, goes a long way toward further incentivizing the adoption of clean and renewable energy technology in Arizona by providing an exemption from state and municipal taxes for machinery and equipment used directly for energy storage. Existing state law levies a tax on tangible personal property while providing an exemption for certain categories, including the retail sale of solar energy equipment and installation of solar energy devices. Dunn’s bill adds energy storage equipment to the list of exemptions. Further development and deployment of energy storage technology — and the jobs and economic development opportunities that come with it — is a critical component of our clean and renewable energy future. If passed, HB2153 would offer an important signal that Arizona is focusing on the future.  

Our report also recommended policies that support advanced manufacturing, including funding programs that enhance the talent pipeline from Arizona’s community college and state university systems into the clean energy and advanced manufacturing sectors. HB2017 sponsored by Rep. Michelle Udall, R-Mesa, provides an appropriation from the general fund to the Arizona Commerce Authority to administer a grant program intended to cultivate STEM workforce development opportunities.  

 Arizona’s clean energy and advanced manufacturing sectors are critical parts of our economy. They create jobs, support existing businesses and attract new ones to the state, and help ensure air quality and the environment are healthy for our communities. Investing in the advanced manufacturing and clean energy sectors by building a larger talent pipeline to support the growth of the advanced manufacturing and energy innovation sectors, as well as encourage new businesses to locate here, are essential if we are to continue to grow and innovate as a state. 

 As we look ahead to the future, we must find new and innovative ways to produce the energy we need to support our growing economy and the businesses and communities that call Arizona home. Fortunately, we have legislators prioritizing the clean energy, technology and innovation sectors by focusing on policy solutions that will have a real and positive impact on Arizona’s economy, both in the short-term as our economy recovers and for years into the future. 

Doran Arik Miller is Arizona director of The Western Way and Steven Zylstra is president and CEO of Arizona Technology Council. 

AZ Corp Comm Works on "First of its Kind" Policy for Smart Device Synchronization

Earlier this month, the Arizona Corporation Commission announced the approval by the U.S. Department of Energy of a cooperative agreement in which the ACC will receive technical assistance from Lawrence Berkley National Laboratory on a proposal to allow synchronization of smart devices on Arizona’s grid.

Lawrence Berkley National Laboratory is a multiprogram science lab in the national laboratory system supported by the U.S. Department of Energy and charged with conducting unclassified research across a wide range of scientific disciplines. Among other things, the Laboratory is conducting advanced research into developing solutions to global energy challenges, including energy-efficient technologies. The Laboratory reports that savings as a result of its work in this area—from “cool roofs to window coatings to appliances”–have been in the billions of dollars.

Specifically, the ACC proposal would allow APS and its customers to save money through the synchronization of their smart devices by establishing a new tariff, or special contract rate, to compensate smart devices for the value each device provides to the grid. According to the ACC, this could include, “at-home batteries when they dispatch extra energy to the grid during times when energy supplies are low, or . . . smart appliances and smart thermostats when they draw excess power from the grid during times when energy supplies are high.” The proposal will help to reduce the overall cost of providing power to customers by better balancing supply and demand on the grid as well as reducing the need to build expensive power plants intended to run for just a few hours each year in order to meet peak demand.

The ACC’s proposal for an all-encompassing demand-side resource aggregation tariff is a “first of its kind” in the nation. Coming on the heels of the Commission’s work to update Arizona’s Energy Rules, this proposal is another way in which Arizona is demonstrating leadership when it comes to finding innovative ways to generate the power we need to grow and thrive while reducing costs to ratepayers and the impact of energy generation on the environment.

According to Lisa Schwartz of Lawrence Berkeley National Laboratory, the idea behind this type of demand-side aggregation is “solar working in tandem with storage, in tandem with various flavors of demand response, whether it’s the utility controlling the water heater or the customer with an automatic smart setting on the thermostat in response to a price signal. And all these aggregated demand-side resources together, providing more value to the utility and its customers instead of just a single distributed resource.” 

Chairwoman Lea Marquez Peterson, along with all four other Commissioners, welcomed the technical assistance by Lawrence Berkley National Laboratory, which will come at no cost to the Commission.

APS is required to file a proposed tariff on April 1, and stakeholders have been encouraged to work with APS both prior to and following that deadline to develop an appropriate rate design, including compensation values and eligible technologies; the proposal is expected to be finalized later this year. Lawrence Berkley National Laboratory will be providing technical assistance throughout the process as well as a final report that will include valuable data on how devices will be able to be interconnected and what value this type of system will provide to the grid.

 

Sen. Paul Boyer Voices Opposition to ACC Bills

TWW thanks Arizona State Senator Paul Boyer (SD-20) for listening to the concerns of Arizona’s business community and announcing opposition to legislation that would upend the authority of the Arizona Corporation Commission.

“Boyer raised reliability and other issues involving the possible change in oversight. He pointed to failures in Texas during the recent freeze and said similar problems could happen in Arizona if power pricing were the only concern the commission could evaluate. He said lawsuits over a change were also possible.

He asked if the Legislature is “the appropriate venue to govern energy policy, given that we’re not year-round and we do not have staff devoted solely to energy policy,” Boyer said.”

The Greater Phoenix Chamber of Commerce, the Arizona Technology Council and Arizona Public Service (APS) are all opposed to the legislation as well. The bills would create an uncertain regulatory climate for businesses by attempting to take away the ACC’s constitutional authority to set energy policy.

Creating this uncertainty while the state comes back from the COVID-19 induced economic slow-down risks needed economic development opportunities and crucial jobs.

TWW, PayPal, and AZ Tech Council Take Deep Dive on Energy Policy & Eco Devo

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TWW’s Arizona Director Doran Miller joined Steve Zylstra, President and CEO of the Arizona Technology Council, and Rich Reyher, Senior Director of Site Reliability and Cloud Engineering at PayPal, to discuss the future of clean and renewable energy technology in Arizona as part of the Phoenix Business RadioX.

The conversation explored the benefits to Arizona’s economy of wider adoption of clean and renewable energy technology, efforts at the Arizona Corporation Commission to adopt updated energy rules, and some of the challenges Arizona is facing as a state in its efforts to generate the energy needed to grow the economy while reducing the impact on the environment of that energy generation.

The conversation also highlighted the report released jointly by The Western Way and Arizona Technology Council in December 2020, which laid out a menu of policy options to incorporate the clean energy and innovation sectors into Arizona’s post-COVID economic recovery.

As Miller pointed out, in many ways Arizona is already leading the nation when it comes to clean and renewable energy technology. Arizona’s business community—and in particular Arizona’s growing technology and innovation sector—is increasingly demanding more clean and renewable energy options to meet their corporate sustainability goals, and Arizona’s utilities have voluntarily committed to their own robust carbon-reduction plans. And, the recent effort by the Arizona Corporation Commission to update and modernize Arizona’s Energy Rules will provide the market certainty necessary to continue to drive investment into Arizona’s clean energy sector.

You can watch or listen to the full conversation above or here.

Energy Rules Offer Opportunity to Continue Shaping Arizona's History

This opinion piece from Steven Zylstra, Emily Duff & Doran Miller originally ran in the Phoenix Business Journal on March 5, 2021 and can be accessed here.

Arizona is once again making history. 

Utility regulators at the Arizona Corporation Commission (ACC) voted in mid-November to advance a bold clean-energy rulemaking package for approval, becoming the seventh state to pass requirements for utilities to generate all their electricity from carbon-free sources. In addition, Arizona is the first state where such a charge was Republican-led and bipartisan, thanks to support from Commissioners Lea Márquez Peterson and Sandra Kennedy.  

A few months ago, Márquez Peterson was selected by her colleagues to serve as ACC chairwoman, making her not only the first Latina elected to a statewide office here but the commission's first chair from Southern Arizona.

Márquez Peterson has made several of her goals clear during her first 100 days as chair, including a priority to collaborate with the Legislature and Gov. Doug Ducey on important energy issues for Arizona, and to “revisit and reinforce our pending clean and affordable energy rules to accomplish progressive outcomes through the use of conservative principles and regulatory mechanisms.” 

The Arizona Technology Council, Ceres and The Western Way applaud Márquez Peterson’s commitment to move the pending energy rules forward. 

Every step of the way, she has demonstrated strong leadership while championing this initiative. Márquez Peterson believes the free market is critical to effective energy policy efforts and has helped set a bold clean energy goal of “100% clean and affordable energy by 2050 for Arizona.” 

She has stood by her commitment to this goal while also steering clear of the turbulent political headwinds created by legislation that would undermine Arizona’s clean energy business sector.

Despite great strides being made at the ACC, a number of bills — including HB 2248, HB2737, SB 1175 and SB1459 — are seeking to block the ACC’s progress on the draft energy rules package. Passage of these bills will create market uncertainty for both current and future companies seeking to do business in Arizona. 

While Covid-19 has fundamentally changed us, what remains constant is Arizona’s foundation as a technology and innovation hub driven by big ideas, talented entrepreneurs and a welcoming business environment. It is imperative to continue the upward trajectory of business relocation and expansion in sunny Arizona.

Stability and certainty encourage growth and innovation. Yet, those handful of anti-energy bills being proposed by state lawmakers as mentioned earlier in this column move us in the opposite direction. 

If passed, the bills will create confusion about who is setting energy policy. Companies considering relocating or expanding their presence in Arizona will not have the market stability and certainty they seek.

The Arizona business community widely agrees that the ACC — with Márquez Peterson’s keen understanding of the importance of market forces — should continue its rulemaking around the energy rules without delay so as to establish clear and consistent standards for the state’s carbon, energy efficiency and storage commitments. 

Technology will continue to evolve quickly, so we need the policies and infrastructure that will be able to adapt to our changing energy landscape (e.g., diversified transmission). 

Arizona has proven its ability to lead the nation in developing solutions for clean and renewable energy technology in ways that benefit our economy. We now have a critical opportunity to open the doors for accelerating energy innovation even further as we plan our Covid-19 economic recovery approach. The ACC’s draft energy rules package will do just that.

As leaders representing a coalition of more than 800 large and small companies, we applaud Márquez Peterson for her continued leadership to move the draft energy rules package forward. We look forward to working with her and the other commissioners for the final vote on this package in April to propel our state forward. 

Steven Zylstra is president and CEO of the Arizona Technology Council and the SciTech Institute; Emily Duff is a manager of state policy at Ceres; and Doran Miller is state director of The Western Way.

TWW Interviews Colorado House Leader Hugh McKean

TWW's Colorado State Director Greg Brophy virtually interviewed Colorado House GOP Leader Hugh McKean this week. The two discussed Rep. McKean’s legislation, HB21-1052, which would encourage the usage of pumped hydroelectric storage. The bill would remove the current prohibition from allowing pumped hydro storage to count as “recycled energy” under Colorado’s renewable energy standards.

Rep. McKean described his interest in working on the issue of energy storage and how changing the prohibition on pumped hydro could lead to more projects taking advantage of existing and planned reservoirs that will be moving water to different locations. Given Colorado’s varied terrain and the importance of water, the bill could play an important role in Colorado’s broader energy and water strategies.

Rep. McKean and Brophy also discussed the importance of energy storage and an “all of the above” energy approach in light of the recent events in Texas. They touched on the importance of base load options and why all technologies should be on the table to ensure reliability.

The two concluded their conversation talking about how conservatives can engage in pragmatic ways on environmental issues. Both Rep. McKean and Brophy agreed that when conservatives take a big picture approach to environmental issues, which reflects the difference between preservation, which prevents all usage, compared to conservation, which looks at a systems wide method to increase benefits among all users, better policies are developed.

Click here or above for the full interview.

TWW Interviews Arizona's ACC Chairwoman Lea Márquez Peterson

TWW's Arizona State Director Jaime Molera had the chance to virtually interview Arizona Corporation Commission Chairwoman Lea Márquez Peterson this week. The conversation covered the latest in Arizona’s energy policy landscape and how new technologies and innovation are driving significant changes. Click for the full interview. Highlights of the interview include:

Q: As the CEO of a chamber of commerce you fought against a lot of regulatory encroachment on businesses, is it ironic that you now work for a regulatory body?

"It brings a very valuable perspective to my role as a Commissioner, I don't want to overregulate, I want to provide as many free market opportunities as possible, but also provide those guardrails that protect public health and safety."

Q. A couple of years ago Arizona was faced with the Steyer initiative, Prop 127, and Arizonans fought against that and you were part of that coalition that fought it off, how do you think it’s going now that it was defeated?

"It’s good that you bring that up, that was Prop 127 and I advocated against that pretty vehemently as a small business advocate, as a chamber president, because it would have put 100% renewable energy requirement on Arizona’s rate payers in a very short amount of time and wouldn’t have allowed for any flexibility because it was a citizen initiative. So Arizona thankfully, resoundingly defeated it.

What we are doing today is completely different, we're setting a goal that is some 30 years out that is focused on emissions standards, we're looking at the end game and not calling out winners and losers in terms of technologies. It's different, and because I had that experience advocating against Prop 127, I think it’s made my perspective certainly a little more in tune and focused as we negotiate our energy rules.”

Q. Let’s talk about the Energy Rules standards, you were a very vocal proponent in incorporating emission-based standards rather than technology-based standards. Can you describe that because that process can be fairly complicated?

"I understand that it’s kind of wonky, the work we do at the Commission, so I’m making it a point now to go around the state to talk to as many groups, chambers, and other clubs that want to learn about this. What we are doing, and it’s an initiative that I proposed and was very proud to do so, was that we achieve 100% clean energy and zero carbon emissions by 2050. A lot of analysis went into just that statement. One, in the past you’d seen standards based on technology, so certain percentage of a type of technology so certain percentage renewables or so on.

But I think it was it was very important to me and as I talked with my fellow commissioners that we don’t pick the winners and losers in technology, that we leave it open to include nuclear energy, we have such an asset in Arizona with our Palo Verde nuclear plant - the largest in the nation - renewable energy, hydrogen, fusion, natural gas and the transition it’s going through. There is so much out there and so much innovation I didn't want to tie us down in a certain technology but really focus on the end goal which was zero carbon emissions.”

Investment in solar can boost Arizona’s post-COVID recovery

The following piece from TWW’s Arizona State Director Doran Miller ran in the Arizona Daily Star on February 11, 2021, and can be accessed here.

As we start to see the light at the end of the COVID-19 tunnel, we need to be thinking creatively and prospectively about how to rebuild our economy.

While some reports have indicated that Arizona’s economy has fared better than others — and that we are poised for a strong recovery — there is no question that Arizona’s economy has taken a hit.

Arizona has demonstrated that there is a proven nexus between supporting the economy and addressing environmental challenges. Investments in large-scale renewable energy projects both put people to work in the short term and strengthen our economy in the long term, and they help bring us closer to meeting the clean and renewable energy goals shared by Arizona’s businesses, residents and utilities alike. Arizona’s largest utilities, including APS, SRP and TEP, have all announced their own robust sustainability goals, and polling conducted by The Western Way and others consistently shows that a broad swathe of Arizona voters support efforts to incorporate more renewable energy technologies into our overall energy portfolio.

That is why the recent announcement about The Wilmot Energy Center, in the Tucson area, is so exciting. The Center, scheduled to begin operating as early as April of this year, is a new 100-megawatt photovoltaic project with 30MW of linked battery storage. When it opens, it will bring additional clean — and cost effective — energy as well as jobs and economic investment to Southern Arizona. Specifically, the project, estimated to cost $145 million, will bring with it about 250 new jobs and help TEP reach its goal of 70% renewable energy generation by 2035, a robust move toward greater sustainability announced in July 2020 that involves reducing carbon emissions by 80%.

This project is also further evidence of on-the-ground progress by Arizona’s utilities toward achieving their own clean energy goals over and above the standards set by the Arizona Corporation Commission, which currently only require utilities to get 15% of their power from renewables by 2025.

Recent progress to update Arizona’s Energy Rules has been encouraging: The updated rules now under consideration, which are the product of an extensive and bipartisan stakeholder process, represent an important step for Arizona toward becoming a national leader in clean energy. The package approved in November 2020 will require Arizona’s utilities to provide 100% carbon-free energy by 2050, with interim benchmarks between now and then. The rules also add a more transparent process for long-term resource planning and a competitive “all-source” bid process that will drive lowest cost resources and benefit consumers. Over time, these changes will significantly benefit ratepayers by ingraining transparency, competition and market forces in the resource planning process.

Chairwoman Lea Marquez Peterson, the first Chair of the Commission from Southern Arizona, has been a strong advocate of efforts to update Arizona’s Energy Rules, taking an active role in ensuring that the new rules package represents a meaningful effort to achieve a diverse and cost-effective mix of energy sources while achieving a robust goal of 100% carbon-free energy by 2050.

Unfortunately, progress on the Energy Rules update has stalled because of political wrangling. Yet, with or without an update to the rules, there is no question that the Wilmot Energy Center will play an important role in moving Arizona closer to carbon-free energy generation and inject much-needed capital and job opportunities into Arizona’s economic recovery.

Arizona’s energy sector has always played an important role in our state’s economy and, as a recent report released by The Western Way and Arizona Technology Council explains, it has the potential to play a significant role in our state’s post-COVID economic recovery as well. As we begin to emerge from the pandemic, investing in clean and renewable energy resources will ensure that Arizona continues to be a vibrant and thriving place to live and work.

Doran Arik Miller is the Arizona state director for the The Western Way.