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Arizona Public Service Seeks Permission to Enter Rooftop Solar Business

On July 28, 2014, Arizona Public Service (APS) filed a proposal with the Arizona Corporation Commission to implement a utility-owned rate-based residential distributed solar program. Under this program, the utility would install approximately 3,000 solar photovoltaic (PV) systems ranging from 4 to 8 kW on residential customer rooftops. In return, participating customers would receive a $30 per month bill credit for “renting” roof space.

Key Details

  • PV systems will be installed on the utility side of the meter; power will flow directly to the grid
  • As the owner of the asset, APS may strategically deploy distributed solar to maximize system benefits with the following strategies:
    • Target deployment to relieve generation, transmission, and distribution capacity shortfalls
    • Orient panels to the southwest to maximize generation at peak load rather than a southern orientation maximizing total generation
    • Leverage smart inverters to manage power quality on the electric system
  • The bill credit is designed to be simple for customers to understand and APS to manage
  • The capital cost is estimated to be $57 to $70 million; exact figures will depend on RFP
  • APS requested an expedited review so systems can be used to comply with 2015 renewable energy requirements


The APS program, with its utility-owned rate-based model, represents a significant step forward in the optimal integration of distributed solar into the electric grid for maximum system benefit. The program will also open up the market for people unable to finance a solar system or meet leasing credit requirements to have solar PV installed on their home.

More Information

APS Application to Commission

Phoenix Business Journal

This report is part of the Clean Tech & Sustainability Minute series. To view all featured Minutes, please click here.

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Contributing Authors

Paul Quinlan Clean Tech Manager

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