The Arizona Solar Tax and Who Benefits From It

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Respectfully submitted by Lawrence E. Rafferty (rafflaw) Weekend Contributor

When I think of places that would be ideally suited for taking advantage of solar power, Arizona is high on the list.  There are approximately 20,000 Arizona buildings utilizing solar collection technology to replace or supplement normal power sources. However, that number may soon decrease if a new “solar tax” is implemented.

“A new interpretation of state law in Arizona could force customers to pay property taxes on leased solar panels. In a state with an estimated 20,000 solar customers and 85 percent of new solar installations being leased systems, the implications of an extra charge are tremendous. The new tax could result in an additional $152 per year for a residential solar array and even more for larger installations, the Arizona Republic reported. What’s more, the tax would apply to both new and existing customers.” Think Progress

At first glance, I guess it should not surprise anyone that a new tax may be initiated.  However, when that tax is a tax on solar panels on commercial and residential buildings and includes solar panel arrays that are leased, it raised some eyes in Arizona.  Why would the State of Arizona decide on a tax on the collection of power of the sun?  The answer may surprise you.

“So, who would support the effort to charge solar customers more money? Solar advocates in Arizona point to the state’s largest utility, Arizona Public Service Company (APS).

Leasing solar panels is often the only option for middle class customers who want to go solar but can’t afford the cost of purchasing the array. And as rooftop solar in particular booms across the U.S., it’s middle class families that are leading the way — posing a real threat to utilities like APS. In fact, “solar technology is being overwhelmingly adopted in middle-class neighborhoods in the U.S., as more than 60 percent of solar installations are occurring in zip codes with median incomes ranging from $40,000 to $90,000,” according to a recent analysis by Mari Hernandez of the Center for American Progress. This trend has utility companies “worried that rooftop solar may undermine their business models as more of their customers go solar and buy less power from them,” Hernandez explained.” Think Progress

I guess maybe I should not be surprised that the APS may be against technology that allows its customers to buy less energy from the utility.  I guess I should also not be surprised who APS has teamed up with in order to fight the use of solar power in Arizona.

The public utility has ties with ALEC, the American Legislative Exchange Council and the state regulatory body also has very strong connections to ALEC.  “In the ongoing fight over whether Arizona will continue its remarkable expansion of solar energy, a ThinkProgress analysis reveals four of five members of the state’s energy regulator are tied to the conservative anti-clean energy group, the American Legislative Exchange Council (ALEC).

The fight centers on Arizona Public Service Co. (APS), the state’s largest utility, versus solar energy companies over how much customers should be compensated for the energy produced by solar panels installed on their homes and businesses. APS believes customers receive too much credit for the excess energy produced by their panels while the industry maintains changing the policy, known as net-metering, would devastate their promising and rapidly expanding industry.

The state’s energy regulator, the Arizona Corporation Commission (ACC), is expected to begin hearings on the net-metering proposal in November. Four of the five commissioners are members of ALEC, the group backed by fossil fuel interests, major corporations and the ultra-conservative Koch brothers. In 2012, ALEC dedicated its efforts to dismantling renewable energy laws around the country and though they failed completely in that effort, leaked documents from their recent annual meeting indicates they have no intention of backing down from the fight against clean energy.”  Think Progress 2

Doesn’t it seem that the Koch Brothers have their dirty energy fingers in just about everything?  As we have seen in the linked articles, the new tax would benefit the public energy utility to the detriment of many middle class consumers who are trying to save a few dollars in energy cost, while at the same time supporting the goal of using cleaner energy sources.  It is interesting that the idea of a new tax is proposed by the same organization and its backers that are against other clean energy supporting taxes that would negatively impact their corporate interests.

According to the free market proponents like ALEC and the Koch Brothers, the market is only free when it benefits their interests.  Everyone else, including the planet be damned. The fact that many of the consumers who would be disadvantaged by this solar tax would be middle class homeowners is just icing on the cake for ALEC.

It bears repeating that the additional cost of the tax would range from approximately $152.00 per year for a residential array and $9867.00 per year for a large commercial installation.  Is the Arizona Public Service Company trying to destroy the solar industry?

Will the ALEC packed state regulatory commission find in favor of the ALEC proposal or will it back the solar energy industry and residential and commercial consumers?  What do you think?

“The views expressed in this posting are the author’s alone and not those of the blog, the host, or other weekend bloggers. As an open forum, weekend bloggers post independently without pre-approval or review. Content and any displays or art are solely their decision and responsibility.”

 

422 thoughts on “The Arizona Solar Tax and Who Benefits From It”

  1. Feynman:

    It is not a doctor resistance movement for political reasons (mostly.) Medicaid and Exchange reimbursements are really low. For example, if insurance pays up to $200 for a procedure, Medicaid would by $26, and the Exchange is similar. Doctors just cannot keep the doors open if they take that kind of a pay cut. Would you be fine if your pay was cut 30% or more?

    My friend used Medical many years ago, and she could not find any doctors who accepted it. She used to sit for hours at county hospital when her kid was sick. So this problem has been going on for many years.

    I just made an appointment with my OB/GYN. The receptionist right away told me that none of the doctors in the group were accepting Exchange policies.

    This is not a boycott by doctors because they are racist. They do not want to try to keep going with a huge pay cut, and succumb to the factory, high-volume method, which would be the only way they could keep the doors open. If they do “get on board” then we will have long wait times, and extremely little time with our doctors, under this high volume model. Is that what you think constituted good health care?

  2. Karen.

    The reason that people who own fossil fuel reserves are determined to block adoption of solar cells is that it wont take much more improvement in the performance to price ratio of solar voltaics to make first coal and then oil worthless for anything other than to prevent the ground subsiding.

    Solar voltaic technology is semiconductor technology. While we may not expect advances in solar voltaics to come as rapidly as those for computers, several years of the current rate of improvement will do the trick. I believe it was between years 2011 and 2012 that the price of solar panels halved.

    At the moment solar panels are subsidized to encourage their use and this has supported an industry which has done research that has improved the price performance. It may be that the subsidy would not be necessary if production of fossil fuels was taxed in proportion to the harm it causes such as AGW.

  3. Paul – thanks for the reminder about Wikipedia. I would never use it as a source in a paper, obviously, but I have gotten lazy and referred to it often for quick lookups. Good reminder that the sources for Wiki are not vetted, and to take the extra 5 mins to keep looking, or use it as a launch board.

  4. Karen, there was a Republican rep who made the statement there is no free lunch. And the kids should do janitorial service in order to pay for their lunch. And there was another one who said the same thing earlier.

    Your policy is loaded with oversight that Darryll Issa would appreciate and is ready to call in CPS if laziness or fraud or abuse is suspected. Such a policy is sure too win the gratitude of many strapped single moms. (sarcasm) But I wasn’t asking for a implementation plan. Just a yes or no. Your response sounds like you support school lunch (and breakfast) but CPS will be watching.

    I wonder what the Ryan budget did with school lunch?

    1. I went to a so-called private boarding high school and my family could not afford all the fees, including meals, so I worked at the school to make up the difference. I do not see a big problem, except supervision.

  5. Karen,

    You maintain it is difficult finding docs and hospitals who will take Medicaid or Exchange patients. Sounds like there is a bit of an Doctor Resistance Movement in your area! They’ll get over it , or they will only serve the rich, or they will quit. . The good guys will stay. Things are tight here, the ERs are just like they were before people had insurance,except this time the hospital can count on getting paid. That is an improvement, no? Soon, sick people will get a doc, make appointments, and get non-emergency illlness taken care of at the office. It is unrealistic to demand that the transition be completed in 30 days.

    Yesterday you said some major hospital would not take exchange patients. Would you be able to name that hospital?

    1. Since Obamacare promised to be the great panacea, it is not unrealistic to ask it to perform as advertised from the get-go. BTW, I have heard that the Federal Obamacare is a slow-pay.

  6. Feynman – you mentioned something about school lunches. Contrary to popular belief, fiscal conservatives do not want the poor to starve in the hedgerows.

    I do recall a brouhaha about school lunches and welfare benefits. From what I recall there were two problems: Some parents were using their benefits for drugs, alcohol, strip clubs, tattoos, and other things, and allowing their kids to go hungry. Taxpayers, by and large, do support feeding and sheltering the poor, but the majority object to this. The other problem is that some parents who can afford it, for whatever reason, fail to provide their children with breakfast and/or lunch.

    So for various problems, children show up to school hungry.

    We have school lunch programs (some offer fried food, pizza, and soda, and some offer hummus and quinoia), that are offered free to kids who qualify. But kids can be mean, so we don’t want to single out the kids who get benefits. So, in my opinion, it’s best to give all kids school debit cards, and just load up the cards of kids who qualify.

    But what about the kids who didn’t have breakfast? What about parents who can afford it but just don’t feed their kids? What happened was schools started offering breakfast, lunch, and in some cases, dinner, to any kid who wanted it, regardless of socioeconomic status. That meant that 20 minutes of homeroom or 1st period went to eating in the classroom (less teaching time), if the breakfast looked good, kids who could get breakfast at home started skipping it and just eating in class (wasting funds meant for the poor on people who can afford it), and that precious education funds in a failing educational system have now been used for a free restaurant for all kids, regardless of socioeconomic status, giving them 3 squares a day.

    My problem with this well-intentioned system is that we’re losing teaching time, using educational funds for 3 meals a day, and that we’re feeding all kids regardless of socioeconomic status. Plus, schools are now overlapping with all sorts of other government programs – welfare, child protective services, etc. To prevent duplication of effort, we need to keep roles well defined.

    Goal: poor kids should not go hungry and more affluent kids should not go hungry.

    Solution: The home of Silicon Valley should be able to create a benefits card that will flag uses for anything other than food, shelter, transportation, and any other agreed upon use. No more cash should be given, because we cannot know what it is used for. The debit cards allow dignity to the users, while allowing taxpayers to keep their money from being blown while kids still go hungry anyway. If poor kids are still going hungry, then either CPS needs to be called, or reform Welfare. Any food assistance at school should be transitional.

    If social affluent parents are for whatever reason too lazy, heartless, or just late to feed their kids breakfast, lunch, and dinner, then you call Child Protective Services. They will have a heart to heart with the parents, and hopefully the parent will start doing one of the most basic jobs of parenting and FEED their kids. If the problem is that they are chronically late, then you point out that you can give your kids lunch money. If they chronically cannot remember to reload the debit card, then you explain to them the most basic jobs of parenting and the consequences if they neglect their kids.

    This brings me to the practice, in some schools, of throwing away lunch if a debit card is empty, and/or replacing it with the stigmatized “free lunch” of mac n cheese. I do not agree with this ridiculous practice, especially of throwing away food and humiliating kids in line. Some schools fail to even notify parents of when their cards are running low. No, you allow the debit cards to go negative, give them lunch as usual, and contact the parents to work it out.

    If the kids of the poor are not getting fed, then I do absolutely support giving them 3 squares a day, but there should be another program doing it than the school. It should be one of the kids programs under Welfare. They could deliver boxed meals in bulk to the home for the kids. And if those get sold for drugs, then please take the kids out of the home. And that brings me to the broken foster care system, which is also a high risk factor for kids ending up in jail. While we’re at it, let’s try to fix this system.

  7. karen s:

    “I am frankly not committed to any particular program. All I care about is the end result.”

    “[The Pragmatists] declared that philosophy must be practical and that practicality consists of dispensing with all absolute principles and standards—that there is no such thing as objective reality or permanent truth—that truth is that which works, and its validity can be judged only by its consequences—that no facts can be known with certainty in advance, and anything may be tried by rule-of-thumb—that reality is not firm, but fluid and “indeterminate,” that there is no such thing as a distinction between an external world and a consciousness (between the perceived and the perceiver), there is only an undifferentiated package-deal labeled “experience,” and whatever one wishes to be true, is true, whatever one wishes to exist, does exist, provided it works or makes one feel better.”

    Ayn Rand
    For the New Intellectual,”
    For the New Intellectual, 34

    The Germans made the trains run and built wonderful roads in the 1930’s.

    There is more than just the end result.

    1. Good luck with getting anyone to stop using any particular source. All you can do is refuse to read it.

      Byron – it was Mussolini who made the Italian trains run on time, I think. 🙂 That made him a god to the Italians.

  8. Karen,

    Sorry. I’ve lost another reply to you. I’ll have to be brief.

    I don’t source Kos. Please don’t source the right wing think tank Heritage that originally developed Obamacare but have hated it ever since Obama became attached to it. It is a partisan propaganda machine – I loved it when they pulled out the slop about Medicaid locking people into poverty to be followed with the assertion that people with private insurance have better outcomes. Real junk.

  9. Carlyle – that would be awesome! As of now alternative energy is far more expensive to produce than conventional, does not have the infrastructure, and still has some kinks to work out – like wind farms chopping up birds and being loud, and solar farms in the desert cooking birds. (Birds have a very trying time in the energy industry, apparently.)

    But I am very excited to follow the progress of green renewables. Since fossil fuels are finite, their use is limited. I am amazed at how far we have come in just the past 20 years. Imagine what the next 20 will bring . . . 50 . . . 100?

  10. Neil DeGrassi:

    We just can’t seem to stop burning up all those buried trees from way back in the carboniferous age, in the form of coal, and the remains of ancient plankton, in the form of oil and gas. If we could, we’d be home free climate wise. Instead, we’re dumping carbon dioxide into the atmosphere at a rate the Earth hasn’t seen since the great climate catastrophes of the past, the ones that led to mass extinctions. We just can’t seem to break our addiction to the kinds of fuel that will bring back a climate last seen by the dinosaurs, a climate that will drown our coastal cities and wreak havoc on the environment and our ability to feed ourselves. All the while, the glorious sun pours immaculate free energy down upon us, more than we will ever need. Why can’t we summon the ingenuity and courage of the generations that came before us? The dinosaurs never saw that asteroid coming. What’s our excuse?

    (Cosmos, May 5). We are the new dinosaurs.

  11. Karen,

    I’ll try to tackle this tomorrow but I wanted to let you know the AMA did endorse ACA. Jeremy Lazarus M.D. wrote an unpublished letter to the WSJ in July, 2012 supporting ACA and stating why. If you get a chance, you may want to take a look at it. You can imagine my surprise given our discussion about the AMA yesterday. I’m withholding the link because WordPress is extra cranky. You can google it, though.

  12. I’ve lost two comments to Karen.

    Should I be concerned or is it just the usual WordPress problem?

  13. Problems with Medicaid Expansion:

    http://blog.heritage.org/2013/04/24/10-myths-about-the-obamacare-medicaid-expansion/

    Please note that Obamacare cuts payments to hospitals for the uninsured. They are trying to get everyone insured, but if you can’t afford it and take the fine, now they are making it harder for you to get treated at a hospital.

    Forbes explaining the Medicare/Medicaid deficit, cuts to providers, and The Doc Fix:

    http://www.forbes.com/sites/merrillmatthews/2013/12/02/doctors-facing-a-24-pay-cut-in-both-medicare-and-medicaid-reimbursements/

  14. Medicaid already took up about 24% of the funding, on average, by states. Obamacare temporarily increased the federal matching percentage, and also increased enrollees.

    But Medicare is coupled with high spending, and poor benefits. Here is a short list of needed improvements. Among them, children and pregnant women need to be transitioned to a better program.

    http://blog.heritage.org/2011/04/07/new-york-times-highlights-medicaid’s-problems/

    In my personal experience with my terminally ill young relative, the benefit of Medicaid is that it paid SOMETHING, and that it was national, allowing her mom to take her to a neighboring state for treatment. The negatives were that there were non-medical administrators that decided what they would pay for, and they made nonsensical decisions like refusing to pay for liquid medications when she was on a feeding tube, even when they were told by a doctor that dissolved pills would clog the tube and require surgery. They would not pay for bandages. They would not pay for some of her surgeries and treatments. There were doctors that would not accept Medicaid. Her mother was still financially ruined, going into debt to pay what Medicaid would not, in order to extend her life as much as possible.

    It gave me a very bad taste in my mouth, seeing what they went through. It’s substandard care, from what I observed, and all I can say for it is that it’s better than nothing. Unless you can find a hospital that would accept an uninsured case; and then it would be worse than nothing.

    Before I would add millions more people to a program that has already been bailed out 3 TIMES, I would try to improve it. I am afraid, quite frankly, that it will simply collapse or need yet more bailouts. And still the benefits will be substandard.

  15. Under Medicaid, the ER is essentially free. And in many locations, it is very difficult to find a doctor who will accept Medicaid. (I know a friend who had an impossible time finding doctors who would take the equivalent, Medical, here in CA.) That means that Medicaid patients clog up ERs for non-life-threatening conditions. Insurers require a copay to encourage participants to self-regulate. If something is free, you will use it more than if it costs you something. We want it to be affordable to go to the ER, but we also want to encourage people to limit it to real emergencies.

    One of the glaring gaps in Medicaid and Medical is the lack of doctors and clinics, as well as a lack of communication with participants on when not to go to the ER.

    http://online.wsj.com/news/articles/SB10001424052702303640604579296580732297854

    http://thehealthcareblog.com/blog/2012/11/24/is-it-time-to-charge-medicaid-members-for-er-usage/

  16. Karen,

    Think nothing of the time . People often move in and out. I was not concerned with your absence. Heck, I am still hoping for a gobbled comment to be posted. And I was only upset about a joke about rape. It had nothing to do with you.

    Of course, it is much more interesting to hear all sides.

    I disagree with you about the value of Medicaid and wonder about the particulars regarding cuts. I am familiar with Republican governors blocking vast numbers, probably millions, of people who would benefit from having such coverage, but I need help about Medicaid cuts.

    We were talking about our shared concern about the children of single moms and I asked if you supported Planned Parenthood, Head Start, SNAP and Medicaid. You have left me with the impression that you believe Medicaid is inadequate and needs fixing. Okay. But in my experience, it has been a life saver. I am dismayed that you describe its expansion as a lowering of service (how?) and as having ‘dumped’ patients into the system. Those patients will include the very ones with which we are concerned – single moms and children. But to move on, what about SNAP, Head Start, and Planned Parenthood?

    As to the media – we are miles apart and I do believe that Fox and conservative radio ARE morally corrupt. What do you call a man who repeatedly calls a woman who testifies for the inclusion of birth control benefits a slut? That’s not rhetorical. That’s a question. Further, I believe the withholding of support for mothers and children to be cruel and to label the unemployed as takers as inexcusable. I believe conservative media, Fox in particular, are in collusion with the Republican Party and libertarians and their policies are anathema to all that was good and decent in this country. I believe that twenty six year-olds were butchered and the Republican response was no gun control. I believe that Zimmerman killed a black teenager for wearing a hoodie, and the Republican response was Stand Your Ground. There is no way possible that any moments spent listening to Hannity, or O’Reilly, or Stossel, or Megan, or any of the ‘blondes’ are going to change my mind. There is plenty of actual live video available on the web.

    Republicans, and I include fiscal conservatives, are against Planned Parenthood, SNAP, the expansion of Head Start, extended unemployment, ACA. It isn’t hard to find Republicans who are against free school lunch and would privatize Medicare if they could get away with it. ‘Slash’ spending is frequently heard.

    Darned if I can think of one program for the poor and struggling that they support.

    But I am a liberal who has apparently bought some divisive myth. I’d be glad to hear a recitation of all the social programs that Republicans endorse and support.

  17. Hi Feynman:

    I wasn’t ignoring you. I just got back from throwing hay and starting dinner.

    I understand how easy it is for our blood to get up during these roiling debates and disagreements that get going. But please believe that it is not my intention to attack you, or anyone else here, even when I am passionately disagreeing with any opinion.

    I am frankly not committed to any particular program. All I care about is the end result. What is most important to me is that we track all programs and ensure they work efficiently now, and produce good results in the future. If anyone comes up with a plan they think can do a better job, I’m always interested to hear it.

    I have a friend, a mother, going through an intensely trying time right now. I care very much what happens to her, her child, and to all the people struggling right now. And I’ve been able to see some of the pros and cons to our current system.

    You’ve heard me complain bitterly about the problems my terminally ill relative encountered with Medicaid. Obviously I want health care for the poor, but I wanted Medicaid improved before tackling the entire health care system. Instead, Medicaid got even more cuts, more lowering of service, and more patients dumped into the system. It seemed like a lost opportunity to fix the system.

    I often hear Liberals in general passionately claim that only they, and their programs, truly care about the poor. I blame the media for perpetuating this divisive myth. And when people believe this, they keep to a rigidly narrow field of media. Believing conservatives to be morally bankrupt, most absolutely NEVER watch Fox News or listen to conservative radio. So they never hear the other side, and become more set in their prejudice.

    At least here, on Professor Turley’s blog, opposing ideas are allowed and encouraged. This might be the only area in which some people ever hear their beliefs challenged. Too often now, we only keep friends who hold the same political beliefs as ourselves. But isn’t it much more interesting to hear all sides?

  18. Professor,

    My apologies.

    In two, I called someone a jerk. Sorry. Won’t happen again.

    I’m not entirely sure of the content of the third one, maybe something about having to look things up in order to check an assertion. I can’t recall the wording and I don’t think anyone was specifically named. I’m not entirely clear how it was uncivil, but I shall certainly be more careful in the future.

    Again, my apologies.

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