Originally Published: October 25, 2016 6 a.m.
PHOENIX - Fearful of how Democrats would view its rate hike proposals, the parent company of the state’s largest electric utility is putting at least $1 million into a campaign to ensure the Arizona Corporation Commission remains an all-Republican panel.
Jim McDonald, spokesman for Pinnacle West Capital Corp., confirmed Monday that his company created the AZ Coalition for Reliable Electricity.
For the moment, Pinnacle West is the sole contributor to the “coalition.” A spokesman for Tucson Electric Power and UNS Energy said his company has a policy of not getting involved in commission races and does not intend to change its policy this year.
McDonald said the move is a direct reaction to the more than $1.1 million already spent by Save Our AZ Solar on the campaign, all of that coming through SolarCity which leases, sells and installs rooftop solar units.
Most of that was spent in the Republican primary on behalf of incumbent Bob Burns, who has subpoenaed the books of Pinnacle West and its affiliate Arizona Public Service. Now the group has turned its attention to reelecting Burns and electing Democrat Bill Mundell.
More commercials are coming from the group which at last count still had $800,000 in unspent dollars. Kris Mayes, who is headed the Save our AZ Solar campaign, said TV ads are set to begin today.
McDonald said voters are being presented with a flawed message designed to protect the business of solar installers. He contends that the policies favored by Mundell and fellow Democrat Tom Chabin will mean “higher and higher bills (for customers) to subsidize huge profits for solar leasing companies.”
He said, though, that no customer money will be used for the effort to support incumbent Andy Tobin, contender Boyd Dunn - and even Burns.
That contention drew derision from Mayes, a former member of the commission, who said there’s really only one source of Pinnacle West dollars: the money it gets from what APS charges its customers.
She said the only question is whether the campaign funds come from the profits Pinnacle West is entitled to earn for its shareholders.
The decision to be up front with the funding is in sharp contrast to the fact that someone - possibly Pinnacle West - spent $3.2 million in 2014 to help elect Republicans Tom Forese and Doug Little.
Those dollars were funneled through Save Our Future Now and the Arizona Free Enterprise Club.
Neither would disclose the actual source of the cash, saying their status as “social welfare” organizations exempt them from having to reveal their donors. A spokesman for APS and Pinnacle West has refused to deny that the companies were the source of the dollars.
It is that question that has led Burns to subpoena the books of the two companies, a subpoena they are trying to have quashed. Despite that, Pinnacle West CEO Don Brandt has publicly endorsed Burns - along with Dunn and Tobin - saying he believes the three Republicans will give his company fairer treatment than either Mundell or Chabin.
Matt Benson, spokesman for the coalition, said that the group will accept other donations. But he acknowledged that, for the moment, Pinnacle West is the sole source of dollars.
He said the fact that the funds are being used to back the three Republicans - there are only the two Democrats running for the three available seats - is not a question of partisanship.
“We don’t believe that energy is a partisan issue,” Benson said.
“However, the two Democratic candidates in this race have made it clear with their misleading statements and extreme rhetoric that they can’t be impartial on the issues that are going to come before the Corporation Commission,” he said. “From Day One, the two Democratic candidates have run on a single issue, and that is their opposition to Pinnacle West and APS.”
McDonald was more direct.
“Based on the steady flow of misleading anti-APS rhetoric from the candidates funded by SolarCity, it’s difficult to believe they could regulate APS or any utility impartially,” he said.
What Chabin and Mundell have said during the campaign is they want to know whether the utility and its parent were the source of the funds in that 2014 campaign. But as Burns’ subpoena shows, they are not alone on that.
They have, however, questioned plans by APS to change the rates charged by utilities to customers who generate some of their own electricity and sell the excess back to the power company.
The makeup of the commission going forward will have a definite impact on how much APS and other utilities get of their plan to change the rates charged to solar customers. Benson said that Pinnacle West felt the need to get involved to get voters to elect a commission more inclined to see things the company’s way.
“What Pinnacle West and the Coalition for Reliable Electricity want to do is make sure voters hear both sides of the issue,” Benson said. “Up until this point they’ve been hearing basically from SolarCity.”
Mayes has a different take.
“APS is obviously afraid that candidates like Bill Mundell are going to protect ratepayers and fight their anti-solar proposals at the Corporation Commission,” Mayes said.
SolarCity has separately spent $6,360 sending a letter to customers urging them to support Burns, Mundell and Chabin.