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Hobbs demands heat plans from Arizona utility companies

By Howard Fischer/Capitol Media Services
Published: Friday, July 21, 2023 - 2:52pm
Updated: Friday, July 21, 2023 - 2:58pm

Gov. Katie Hobbs is demanding utilities tell her how they're prepared for record heat even though she has no legal authority to do so.

In a letter Friday to electric companies, the governor said she wants their "action plans for protecting Arizonans during this unprecedented heat wave." And that specifically includes everything from grid security to policies on disconnecting customers for unpaid bills and services available for customers who fall behind in payments.

Only thing is, most utilities are subject — and answer — to only the Arizona Corporation Commission, the constitutionally created agency that regulates the activities and rates of electric companies. That left Christian Slater, the governor's press aide, to explain where his boss gets any authority over utilities.

"Well, constitutionally, maybe not," he told Capitol Media Services.

"But I think it is her role to bring parties to the table to ensure that everybody's doing what they can to keep Arizonans safe during a historic heat wave," Slater said. "I don't think that's something that's super outrageous."

But it is the Arizona Corporation Commission that can and does bring utilities "to the table." And that is backed by not only their general constitutional regulatory authority but also their power to subpoena utility executives to answer questions and demand their documents.

In fact, the commission, exercising its powers, dictated to electric companies two years ago that they can either stop disconnections entirely from June 1 to Oct. 15 each year or, if they prefer, when outside temperatures are not going to exceed 32 degrees or will be higher than 95 degrees.

A spokesman for Arizona Public Service, the state's largest electric utility, said his company won't do any disconnects for past-due residential accounts through mid-October and is waiving late fees for customers during this period. He also said APS offers flexible payment arrangements as well as bill assistance.

There was no immediate response from Tucson Electric Power or Unisource, its sister company.

Salt River Project, which is not regulated by the commission, has said it does not disconnect customers when the National Weather Service has issued an excessive heat warning.

The governor's letter — with copies to the media — went out just hours after Jim O'Connor, the Republican chairman of the five-member commission, issued a press release saying that utilities have "successfully managed to meet electricity demands during these challenging times."

O'Connor cited several reasons, including at least one the governor wants to hear for herself from utilities: details of the transmission grid interconnectivity.

Hobbs' demand to the utilities comes less than a week after she announced that the Arizona Department of Occupational Safety and Health had a new "emphasis program." While she cannot give that agency any new powers, she did direct its inspectors to focus on both preventing heat-related illness and injuries at workplaces and using its general authority to require safe workplaces to cite companies that don't provide adequate water, shade and rest.

But Slater denied that this new letter is a publicity stunt, even if, unlike the Arizona Corporation Commission, she has no actual power to require the utilities to do anything.

"As the governor, she feels it's important to convene stakeholders to ensure that they're doing every single thing that they can to protect Arizonans from this heat wave," he said.

And what of the utility regulators?

"It's great that the Corporation Commission is doing their work as well," Slater said. "But the governor is also interested in hearing directly from corporations, from utilities, what they're doing to make sure that Arizonans, when they turn on the AC, are able to cool their homes during a heat wave."

Lea Marquez Peterson, another Republican on the commission, told Capitol Media Services she is not concerned that the Democratic governor is getting involved in something that is within the panel's constitutional purview. Nor is she opposed to the governor also studying the issues.

"We know it's life or death if we don't have air conditioning, especially during the really hot peak summer days," Peterson said.

But Peterson said she wants to be sure that the governor knows the work that's already been done, including the "integrated resource planning" process.

"The utilities submit those to us every year," she said. "It's a 10 to 15-year outlook on where the resources are coming."

There also was an "energy reliability summit" that looks out for the next three or four years," Peterson said.

"So we are on top of this, tracking this, holding the utilities accountable," she said, saying the panel welcomes sharing information with the governor.

And what of Hobbs approaching the utilities directly?

"I don't have any concerns about her asking the questions," Peterson said. "I just hope that she's aware of the information we're already collecting and the accountability we're holding the utilities to as the Corporation Commission."

The APS spokesman said his company plans to respond to the governor's demand.

APS has been particularly cooperative with Hobbs after its parent company, Pinnacle West Capital Corp., gave more than $850,000 to the Republican Governors Association last year as part of that group's bid to elect Republican Kari Lake as governor.

After the election, Pinnacle West donated $250,000 to fund Hobbs' January inaugural ceremony, making it the largest single contributor. In fact, the entire event actually cost less than that, with the excess from all donors going into a "social welfare" organization that can spend money to help defeat Republicans in 2024.

It has since given another $100,000 to the Arizona Democratic Party.

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