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Arizona New-Build Gas Moratorium to Continue

Posted On February 11, 2019 at 10:00 pm by / No Comments


Last week Arizona regulators voted to extend a ban on new-build gas plants in the state through August 1 of this year. The ban applies to all new gas capacity of 150 megawatts or more.

The Arizona Corporation Commission voted in March of last year to put a stop on any new gas plant approvals, while it considered a plan from Commissioner Andy Tobin that calls for 80 percent clean energy by mid-century. Though the original gas moratorium expired January 1, Tobin argued in a November letter to the commission chair that the moratorium should be extended because regulators had not made significant progress on considering the plan.

“While there has been some progress to-date such as opening a new docket, such a formal rulemaking has still not occurred,” he wrote to commissioners. “My concern is that, if the moratorium expires as planned, utilities may once again consider large capital investments in generating facilities and undermine the effectiveness of any energy plan we adopt in the future.”

“I believe it is in the best interest of ratepayers that we continue to slow the immediate build-out of this infrastructure until we have a clearer picture of where this Commission would like regulated utilities to head in the future,” he added.   

Now, commissioners will continue withholding approval of gas plants while they work through a series of workshops on new energy policies. The last workshop is scheduled for July. 

Consumer advocate group Arizona PIRG Education Fund praised the move as “an opportunity for a fair, independent evaluation of all resource options,” that can avoid higher rates and future stranded assets. This month, the organization, along with clean energy and environmental advocates, urged the commission to extend the moratorium.

In addition to the 80 percent clean energy mandate set out in Tobin’s proposal, his “grid modernization plan” calls for 3,000 megawatts of energy storage by 2030, the drafting of utility charging infrastructure plans and build-out of energy efficiency programs.

The debate surrounding Arizona’s future energy mix grew contentious leading up to the 2018 election, with a 50 percent renewables ballot initiative joining Tobin’s plan as possible replacements to Arizona’s current 15 percent by 2025 renewable portfolio standard. While voters struck down the 50 percent option, Tobin’s plan — which, unlike the 50 percent proposal, leaves room for nuclear — remains under consideration. 

Though Tobin’s colleagues agreed to extend the ban, Utility Dive reported that at least one signaled he may not choose that course of action in the future. 

“I only take this vote on the basis the utilities involved will be allowed to continue to enter into any power-purchase agreements they feel are necessary during the period of the moratorium without restriction,” said Commissioner Boyd Dunn, who, like Tobin, is a Republican. “I hope that will be the last time we will deal with a moratorium.”



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