Local opinion: Tucson should use solar incentives to reduce reliance on TEP

Local and state governments are aware that water withdrawals exceed additions to our local water aquifer, that CAP announced it will reduce water supply to Tucson by 30% and that Tucson Electric Power Company (TEP) plans to construct more natural gas-fueled power plants that will increase TEP withdrawals and accelerate water depletion.

They should also be aware that TEP pays nothing for that water. All costs to identify new water sources and transport to Tucson will be charged to ‘captive’ Tucson Water ratepayers.

TEP classifies natural gas combustion as being “clean” because it does not generate carbon emissions like its coal-fired plants. TEP ignores the fact that natural gas, when mined, releases “dirty” methane emissions that trap 80 times more thermal energy than carbon, which increases average temperatures and increases electricity usage for cooling, which increases TEP revenues/shareholder dividends and increases economic burden on all members of our community. The extreme heat/weather events also increase avoidable healthcare and private-public property damage costs.

Yet TEP and COT are not working together to quickly REDUCE/not increase TEP water consumption and avoid crises and costs charged to captive taxpayers/ratepayers.

COT can mitigate and avoid these costs, and chronic TEP rate increases, by negotiating a Franchise/Energy Collaboration Agreement that requires that TEP generate 50% of its electricity requirements utilizing free fuel, much lower capital, and operation-and-maintenance cost Solar-Energy Storage by 2031.

There are many actions that COT should be aggressively enacting to avoid future costs, charges to captive taxpayers & ratepayers (TEP/Tucson Water).

Here’s a “Starter” program concept:

Pilot program

The City of Tucson (COT) works with Arizona (Tucson preference) solar-battery energy storage system (BESS) Suppliers to define a Program to invest/fund 50% of the costs of ratepayer owned Solar-BESS systems.

COT establishes contracts with Suppliers to provide discounts and manage the Program. COT controls the fund transfers to either the Solar-BESS supplier or ratepayer owner after the system has been placed in operation.

The benefiting Ratepayer Owner funds 50% of the capital costs, 100% of the Operating-Maintenance costs for the 20 to 40-year life of the system.

Ratepayers would include homeowners, local government and public service operations, Hospitals, Shopping malls, Apartment landlords, Businesses, etc.

If desired, the Program could fund 100% of the initial costs for low-income ratepayers.

Program capital funding sources include, and are not limited to, reallocation of current COT Budget expenditures; Pima County; Beale Industries committed $400 million to fund the incremental Renewable Energy generation required to service new data centers; Governor Hobbs Resilient Energy Fund; Water Infrastructure Finance Authority of Arizona (WIFA); Federal BESS Incentives.

Return on investment

Ratepayer Generation using Solar-BESS would reduce TEP withdrawals of our precious aquifer water and future replacement costs.

Many diversely located Solar-BESS microgrids improve reliability, reduce vulnerability & TEP system costs, improve demand-supply management, energy efficiency, and BESS displaces the need for more expensive Gas Peakers. They also reduce the need for Incremental Transmission Infrastructure, about 10% of a residential TEP invoice, and avoid the typical loss of 8% of the electricity during transmission. These cost avoidances will stabilize community, ratepayer-taxpayer costs for decades.

The program would allow residents to reallocate current electricity expenditures to satisfy other needs, which would increase local trade, economic stimulus and incremental tax revenues without increasing tax rates. TEP currently exports ratepayer revenues to purchase gas from other states and profits to Canada.

The Program would stimulate local/Arizona Solar Industry/Businesses, generate more tax revenues/no tax rate increases.

The Program would not impact current TEP sales/financial performance and would avoid the need for TEP capital Investments and the 9.5 to 10.5% interest, all recovered from ratepayers via chronic rate increases.

Ratepayer Generation would allow TEP to utilize its CURRENT generation capacity to satisfy incremental electricity demands, i.e., Beale; Population Growth.

Call for action

Please request City Leadership and Management to quickly establish this Program to avoid future costs, deliver tangible benefit to taxpayers and community; a Pilot Demonstration Program that can be used by all Arizona communities. ACT now to AVOID increased costs/rates.