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?

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

  1. nick:

    What do you think about this idea:

    “We are being ruled by a minority who are bullies and who use the press as a billy club and to make people think that liberal thought is main stream.”

  2. Can anyone rescue my two missing comments? Because they address some questions here. Thanks!

  3. Feynman:

    On the Tea Party:
    http://www.infoplease.com/us/government/tea-party-history.html

    “Tea Partiers detest all things big: big government, big business, big national debt, big taxes. They express hostility toward the elite and outrage that the government has come to the aid of Wall Street while ignoring the plight of Main Street. Most Tea Partiers consider themselves citizen activists who are part of a grassroots movement that is organized from the bottom up—small groups united under a shared ideology. The movement claims no national leader or figurehead.”

    As a grassroots movement, many have gotten involved, from middle class housewives, like the one who started the first rally, to high-profile conservatives who support the idea.

    It is, in essence, a loose coalition of Americans who are sick of business as usual in Washington.

  4. Karen,

    With regard to starting 40 years ago…

    Says who?

    What countries do the best job of educating their kids? They sure don’t run around offering vouchers and letting idiots open up one school, fail, and then allow the next idiot to give it a shot.

    They have a national educational system with national standards and they SPEND money to run a very fine system.

    We, on the other hand, don’t believe in ANYTHING national, or standards, or spending money. And a hell of a lot of us don’t believe in science!

    It puts us at something of a disadvantage, eh?

  5. Karen

    Wonderful. One charter school fails so we’ll just open another. Who can also fail. You have no idea of the opportunist idiots that are running these schools.

    And just where to the kids fit in this plan of ‘okay, let’s close this school and open another’?

    That is one incredible recipe for educating children. You have just eliminated your position that you care about the kids. That is just one great way to watch a kid who is at risk to bail on any idea of getting an education.

    1. When a charter school fails, they have to start the process all over again for a new school. Anyone associated with a failing school would be a red flag for the board. They would want to see a new business model to show that you could make it, or that you were competing against too many other charters in the same area (this happens in central Phoenix).

  6. feynman:

    prisons should not be privatized, that is a legitimate function of government as part of the court and police systems.

  7. there is no public responsibility for health care or for education or for any number of things provided to people at the expense of taxpayers.

    The General Welfare clause is not a blank check written on the bank accounts of some individuals for the purpose of transfering money to other individuals.

  8. Karen,

    I do not argue that people should not be paid for their work. That is choosing to believe the extreme.

    I argue that corporations should not be running public works. The corporation’s first duty is to make money, increase revenue, get positive quarterly results. We have ample evidence that an easy way to do that is to cut-corners, reduce staff, supply inferior material, hire the least skilled. That is not a recipe for producing the best outcomes.

    The privatization of prisons is an excellent example. What is the goal of a privately run prison? It is to keep it full. It is to reduce staff. It is to reduce costs. Those goals can have terrible consequences and will impact our justice system.

    It is going to be much more complicated to assess charter schools. But ‘loving the idea’ is not much of a start..

    1. Arizona charter schools are assessed all the time. They usually have an annual visit by staff from the board and then periodic reviews by the board itself. In Arizona, all payroll, etc. is handled by the same firm for all schools so there is no financial hanky panky going on.

  9. Raffy – sorry to be so importunate, but my charter school comment is in WordMess jail. Can you get it out please?

  10. Feynman:

    I have tried to explain that the performance for charter and public schools, and rankings, are online. Parents now have the right, and the opportunity, to research each one and choose what’s best for their child.

    Our charter school is hands-on. We have elementary kids learning about genomes in a lab. And language, arts, music, sports teams . . . to compare it with our public school that doesn’t even have a gym is laughable. We’ve had suicides at the public school from bullying. There has been zero violence at the charter. I’m friends with parents who yanked their kids out of public school after suffering through a year of subs. Their kids blossomed at the charter.

    I am a parent, and I want a choice.

    Teachers unions do not want me to have that choice. If public schools were so incredible, then they should not care if there is competition. They should be confident they are the best choice. When any organization, whether it’s Big Business or a Teachers Union, tries to squash a competitor, what does that tell you? That they do not think they will fare well in a competition, so they want to use their money and political clout to destroy competition. That is why we have anti-monopoly laws.

  11. If we had engaged in this kind of educational innovation 40 years ago, our public school system would have been a model of excellence today.

  12. Paul – so true. When a charter school fails, it is a good thing, because its model was faulty. And that gives room for another charter to take its place. It’s a laboratory that experiments on what educational models work best.

    When a public school fails, it stays open, and graduates kids who cannot read.

    I am so passionate about improving education in the US. I want the public education system to be flexible enough to improve. If students are not achieving, try new things, and if that does not work, try a new approach. Teach more hands on rather than theoretical work. Apply lesson plans to local examples.

    But the teachers union prevents any such innovation. It blocks the firing of substandard teachers, making kids pay the price. It opposes competition. It opposes merit based pay for teachers, which would pay the highest performing teachers the best. (This, by the way, is how it usually works in private industry. When you do well, you get a raise and a promotion.)

    I still think the public education system should improve. But as long as it steadfastly refuses to fire bad teachers and reward good ones, then what can I do but look elsewhere? And many parents are not wealthy enough to afford top-performing private schools. So what’s left? Charter schools. And there are some really excellent ones.

    Let the poor performing ones fail, and give room for the next one. The trend is for improvement, and the model indicates that parents will only choose charters that perform better than public schools. If a charter school becomes so successful that it drains all of the students away from a poor-performing public school, who will mourn the loss? Certainly not the parents or the students, who would have been stuck at a worse school without that choice. Who mourns? The teachers unions, and a public school system that refused to change. But not the kids. And if teachers unions were “for the kids” then it should want the best outcomes for them, even if it means the union’s own demise.

    If anything will motivate public schools to change, it will be competition.

  13. Karen,

    It is not enough to love an idea. How are the students doing? What are they being taught? Are they adequately prepared for the responsibilities and joys for the next steps as they become adults?

    I’d like to know about these schools: are they non-profit or for profit? What are their credentials and the teacher’s credentials? Then I want to know about the availability of their financials. How much are they spending on executive salaries? What is the teacher turnover?

    It is my opinion that nothing is obvious. Especially when public schooling is being dismantled. And, to me, one of the motives for that dismantling is to get rid of unions. Unions that are a political force and most often oppose Republican positions.

    Vouchers privatize. Vouchers for schools, vouchers for Medicare? Code for privatization for what is a public responsibility.

    1. Annie – it appears that the highest number of abortions is in the black community. This would make Margaret Singer proud. Here purpose was fewer black poor babies. However, there do seem to be a number of women who have had multiple abortions. So, either birth control methods are failing or some people are not learning from their first one.

  14. Feynman:

    Every job I have ever taken in my life has been for the money. If I wasn’t paid, then it was volunteer work.

    Why is working for money an obvious goal if you are an employee, but somehow suspicious or nefarious of you own a business? We are small business owners, and I guarantee you that it is to make a living.

  15. Feynman:

    In the case of charter schools, they have to compete for students. In order to compete, they have to entice parents to enroll their kids. And how do they do that? By competing for excellence. If their educational model fails, then parents do not send in their kids.

    Our charter school was founded by parents were were disgusted with the public school in their area. I applaud them for actually doing something about it.

  16. Feynman:

    If a charter school performs badly, then it fails. Parents do not send their children there. They operate with public funds the same as public schools. So they provide parents with a choice of schools, survive or fail based on student performance, and are publicly funded. They offer a choice for parents who cannot afford exorbitantly expensive private schools.

    We have a charter school that is a top performer in CA. Our public school is a low performer, and has problems with drugs and violence, none of which are at the charter school. Hmmmmmm. Tough choice . . .

    As a parent, I want a choice of where to send my child to school. I can review the performance of the schools in our area, and choose. The charter school is so popular that they hold a lottery.

  17. Some and I repeat the word some, charter schools are for-profit. So, big deal. In Arizona, which you seem to have a problem with, we have hundreds of charter schools. They come in a myriad of opportunities for students. I worked at charters that specialized in at-risk students, but others specialize arts, technology, sciences, etc. One I worked at now offers a yearly science trip to the Caribbean. I idea of the charter is that it cannot support itself, it fails and closes. Failing regular public schools are kept open, fully staffed, hemorrhaging money. Charter schools who fail close their doors and I worked for one of them. I personally know of three major public high schools that should be closed. We used to get their students all the time.

  18. Karen,

    Sometimes, here in America, the race is for the dollars, not for excellence. No?

  19. Nick,

    So now some believe charter schools, with no unions, are the solution. Charter schools often are ‘for profit’ and big business. Ancillary businesses are created and lots of money is being made. Ask Jeb Bush.

    And many charter schools face no accountability. Some fold in the middle of a term. A board can’t prevent that. Some charter ‘chains’ win a big contract and sub out the actual management and teaching at their schools. This sub contracting prevents any investigation into how funds those funds were spent. Do you suppose this will work to the advantage of the kids?

    Then the question becomes: what is the fundamental duty of a ‘for profit’ company?

    It’s probably not the kids.

  20. Nick – true. We have had several high-profile case of teacher pedophiles here in CA, and the support of the unions made me ill.

    They also have something called “warehousing”. When a school district considers it unsafe to have a teacher in any contact with students, but cannot fire them because it would take years and hundreds of thousands of dollars, then they pay them to basically go sit in a room all day. “For the kids” my foot!

    And I’m vehemently against tenure. I had some awesome public school teachers, but I also had some that read novels all day in class. If the school has an underperforming teacher, why should our kids be stuck with them? A shaky education can affect a kid’s entire life!

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