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July 23, 2013

Host: Ted Simons

Cave Creek Solar Power Vote

  |   Video
  • The town of Cave Creek is the first Arizona town or city to officially oppose rate hikes for solar power users being proposed by Arizona Public Service. The town unanimously voted to oppose the rate hikes, saying that it could hurt the installation of solar power in homes and hurt the economy. Cave Creek Councilman Ernie Bunch will talk about the vote.
  • Ernie Bunch - Councilman, Cave Creek
Category: Business/Economy   |   Keywords: economy, solar power, aps, cave creek, vote,

View Transcript
Ted Simons: The town of Cave Creek is the first Arizona municipality to officially reject a proposal to raise rates for solar panel users. Joining us to explain what was a symbolic yet unanimous town council vote is Cave Creek council member Ernie Bunch. Thanks for being here.

Ernie Bunch: Thanks. First time. Scared to death.

Ted Simons: The council votes to oppose solar rate hikes here. Couple of options. Why?

Ernie Bunch: The solar industry is really important thing for Arizona because we have so much sunshine. Creates a lot of electricity. APS is really looking to yank the rug out from the bottom of the solar industry in the state. It's not a good thing for Cave Creek. We're wide open spaces. We love the outdoors. We are the kind of community -- we always have had a lot of solar installations in the town.

Ted Simons: One bills credit on returned power back to the grid, with net metering being the idea if you don't use as much power you get reimbursed. The second would be paying what APS considers a fair price on them getting the returned power. What's wrong with those ideas?

Ernie Bunch: There's probably nothing wrong with the ideas in principle, but the real world effect of those ideas is that without a good financial gain solar is not going to make a lot of sense. Solar in all honesty will never pay for itself completely. It's probably the most expensive renewable energy source that we've got. Numbers I saw about three years ago were over the life of the system about 12 cents a kilowatt to generate that. Without getting the kickback why would anybody put those systems on their homes without a good benefit?

Ted Simons: Yet APS says because people are getting that benefit and they are not paying as much as they used to and we have done a number of stories on this and whether the future of utilities is the way they are now that's a different beast all together, but they say if you got your solar panels and I can't afford that, you're paying less which means some of us have to start paying more and that's not fair.

Ernie Bunch: Once again that goes to the fact that the solar really is the most expensive renewable energy source. I think the country as a whole has missed the boat. If you look at the European union you'll see most of the power used in Europe is generated from nuclear. The American people have a real aversion to nuclear power plants but that's what makes the most sense. It's probably around a penny per kilowatt for generation over the life of the plant. Public opinion has caused APS and other utilities across the country to do things that are not in their own best interests.

Ted Simons: Interesting. That's something that we'll talk about at a later date. It is fascinating when you think about the future of utilities. Your VICE mayor was quoted saying cave creek represents rugged individuals and Cave Creek should oppose a monopoly's efforts to suppress the free market or otherwise create is incentives for individual investment in alternative energy. Do you agree with that?

Ernie Bunch: For the most part. He talks very eloquently. He's an attorney. He can't help himself.

Ted Simons: Let's parse it down here. Is APS trying to suppress the free market?

Ernie Bunch: I don't think so. In the solar energy, the market has actually been propped up by the incentives and net metering going on. APS has a legitimate argument. I'm cursed with seeing this issue from both sides, however, I don't believe that the two ideas that they sent to the corporation commission are all they should be there and they need to sharpen their pencils. I'm assuming that's APS's prayer, they hope the corporation commission rubber stamps them and sends them back.

Ted Simons: Again, VICE mayor in the paper saying the APS wants state sanctioned consumer funded corporate welfare. Do you agree with that?

Ernie Bunch: Probably to certain extent. Yes.

Ted Simons: Why? Why do you say that?

Ernie Bunch: Well, we're going to have a moment here.

Ted Simons: You go right ahead.

Ernie Bunch: Ask me again, please.

Ted Simons: The idea that this is state sponsored, consumer funded, corporate welfare on the part of APS, the reason I bring this up, this is the town's vice mayor, and those are pretty bold statements there. That's pretty rough stuff. I want to know if you agree with that.

Ernie Bunch: Probably not 100%. He's a pretty good guy, very opinionated. Speaks very forcefully.

Ted Simons: Let's talk about what APS says. They say solar customers get too much credit for power sent to the grid. Valid argument?

Ernie Bunch: Yes. They are getting many times the numbers I have seen are 14 to 16 cents a kilowatt. Quite honestly I believe that they should be more in line with what they pay for the wholesale, people when they buy stuff off grid bring in here. I also think that they should be allowed or that consumers should be allowed to bank that over a yearly period and use it against their accounts the whole year.

Ted Simons: When APS says they are looking to pay a fair price for the power that's returned to the grid, it sounds like you think that there's room to move there.

Ernie Bunch: There is. Like I say I believe that what they sent to the corporation commission was their prayer and hoping their prayers are answered and the reasonable solution lies somewhere in the middle.

Ted Simons: Speaking of bold statements, APS has said that solar users benefit from a reliable grid with little or no cost. Do you think that's true?

Ernie Bunch: That's true as well. I'm conflicted.

Ted Simons: You're seeing things from both sides. I find that very interesting. Yet the council voted unanimously and it sounds as though you believe this could hurt the economy up in Cave Creek and hurt the way a lot of people live.

Ernie Bunch: I think it's going to hurt the solar industry. I believe when the incentives are gone it won't make much sense. We have seen what happens when government tries to push solar on the populace with Solyndra where tons of money were lost from the production end. When those things, they produce those things with all the help, then you have to have a marketplace for those to go to. If we shut down the marketplace there won't be any home for the existing systems that are out there and what's supposed to be built in the future.

Ted Simons: If the two options are not all that feasible, attractive, yet you understand why they are coming from because again if someone's paying less someone will wind up paying more, this is again for the structure of the grid, for transmission lines. I don't think they are arguing power plants any more. The more solar the less you need power plants somewhere. Be that as it may, is it understandable to you that something has to be done, that this is just basically -- the model isn't feasible for APS?

Ernie Bunch: Absolutely. The numb I have seen is that they are losing approximately $18 million a year, 18,000 solar customers. They believe they lose about $1,000 per household per year. That's not good for their shareholders. One of the things that helped me make my decision to vote in favor of the resolution was they came in and talked about it being a fairness issue, not a money issue. That's not right. It's a money issue. What they are looking is down the road when they have 60,000, 100,000 solar customers and that number that's 18 million now becomes 60 or 100 million and they are in trouble. It's a financial issue.

Ted Simons: From their perspective they say those 60,000 are paying less, everyone who is left if I don't have the solar I'm paying more. That's not fair.

Ernie Bunch: That's right.

Ted Simons: There's a fairness issue in there.

Ernie Bunch: Yes.

Ted Simons: Thanks for joining us.

Ernie Bunch: Well, thank you.

Focus on Sustainability: Wind Energy Project

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  • U.S. Secretary of Interior Sally Jewel recently announced the approval of a massive new wind energy project in Arizona. The Mohave County Wind Farm will create up to 500 megawatts of electricity, enough for 175,000 homes. It will also create 750 jobs. The project, proposed by BP Wind Energy North America, will have up to 243 wind turbines on federal lands. It will be located about 40 miles northwest of Kingman. Ray Suazo, the State Director for the Arizona Bureau of Land Management office, will talk about the new project.
  • Ray Suazo - State Director, Arizona Bureau of Land Management
Category: Energy   |   Keywords: wind, energy, arizona,

View Transcript
Ted Simons: A new wind energy farm is in the works for 35,000 acres of federal land in Mojave County northwest of Kingman. The project is part of President Obama's comprehensive climate action plan. Here with more is ray Suazo, the state director for the Arizona Brewer of land management.

Ray Suazo: Thanks for having me.

Ted Simons: I want to get to that in a little bit. Describe this project. What exactly are we talking about?

Ray Suazo: We're talking about essentially roughly around 243 turbines that would generate when at full capacity anywhere from 425 to 500 megawatts of power. Essentially the equivalent of producing enough energy to provide energy for about 175,000 homes. So it's a pretty big deal.

Ted Simons: Where are we in the process?

Ray Suazo: So we just recently secretary Jewell signed the record of decision in late June, and so we're in the process of the project is at the point now that they can start to move towards development of the project. We just got through the analysis phase and the decision making process.

Ted Simons: I mentioned northwest of Kingman. How far northwest of Kingman?

Ray Suazo: We're about 40 miles northwest of Kingman. So it's in the area that if you have ever driven up through that area there's a lot of wind and a great opportunity to harness that resource, that renewable resource.

Ted Simons: There used to be a lot of nothing too.

Ray Suazo: In some areas, yes.

Ted Simons: In this particular area, wide open spaces?

Ray Suazo: So some wide open spaces. There are some areas where obviously there's a lot of natural resource that the public has an interest in. Part of our process to analyze those spaces is to think about the use of those particular spaces and how this project would work together with it.

Ted Simons: Let's talk -- I'm sure that's part of the review process. Let's talk about that. I have heard Golden eagle habitat is in that particular area. What's being looked at?

Ray Suazo: One of the nice things about the approach that we have taken and thinking about the footprint of the project and the process that we use to walk through and analyze the impacts is not only thinking about keeping the project viable but thinking about how we protect and make sure that we take mitigation measures towards those specific resources. In the case of this project the analysis led us to a reduced footprint and to making sure that through mitigation that we're paying attention to eagle nesting areas, that we have 1.2 mile buffer to make sure we don't have any turbines near any of those nesting areas, and in particular also the private property. We won't have any turbines that are within a quarter mile of private property. So really trying to balance the viability of the project with the natural setting as well.

Ted Simons: How close to Lake Mead?

Ray Suazo: It's also near Lake Mead. Part of the analysis we reduced the footprint and kept as much as we could, you know, that visual perspective intact. A lot of the mitigation will look at specifics for that. Really keeping in mind the relationship of that area with the project itself.

Ted Simons: So this is now -- who is running this plant? Who is behind this?

Ray Suazo: B.P. Wind Energy is the company who will be issued the right of way, who will eventually construct and develop the project.

Ted Simons: What kind of jobs are we talking about? First to create, then to operate?

Ray Suazo: So the creation, the construction phase could be up to about 175,000 jobs. 175 jobs with roughly about 30 once it's in permanent state running, fully functioning.

Ted Simons: Is that the kind of things where there will have to be housing built to accommodate those folks?

Ray Suazo: I suspect there will be -- the support services that come in when you have this level of construction will certainly be part of the process.

Ted Simons: What about water needs. We're always concerned about projects like this.

Ray Suazo: Certainly obviously water, those are considered part of the impacts of thinking about a project. Keep in mind this is a wind project which is much different than maybe some of the other solar projects that are very water intensive. So the water, the amount of water that would be used would be essentially for anything construction related, not in the way of running the facilities more long term.

Ted Simons: Operationally a massive water supply is not needed.

Ray Suazo: No.

Ted Simons: What about infrastructure, what about transmission lines? It's one thing to have the power, another to get the power from point A to point B.

Ray Suazo: That's a very good question. Once this is up and running, it will be linked up to the transmission grid and the power will be assuming we can get a B.P. wind can get a power purchase agreement, figure out who is going to buy the power and how we get it there. We have several other projects in the state where we're taking a look at transmission and how do you move energy, not just within the state but to the western -- around the western grid and working to do a couple of things. Move those resources around and make them available but then also strengthen and solidify the grid. A few years back when there were a lot of rolling brown-outs and black-outs in the west, when we have an opportunity for projects like this and in particular with transmission to upgrade the grid, it's a good thing.

Ted Simons: So the construction and the upgrade and the whole kit and kaboodle, what time frame are we looking at?

Ray Suazo: Well, once they start moving through the project, I think we're in the neighborhood of a couple years to four years. It depends how fast they can move. Then the real factor that comes into play is power purchase agreement. Who is buying the power and where are we going to move it.

Ted Simons: Before we go I want to get to President Obama's comprehensive climate action plan. What's that?

Ray Suazo: So President Obama recently announced more emphasis on taking a look at climate impacts and if you think about what a wind project like this would play a role in, it definitely play as role when you think of climate impacts in the west which we're just starting to pay attention to, what do they mean and how do they affect the west in general, what do we have? Drought. We have a whole host of things whether it be riparian and other. Having a responsible renewable energy like this project is only an added value towards that climate change approach.

Ted Simons: Alright, thank you so much for joining us.

Ray Suazo: Thank you. Appreciate it.

Ted Simons: And that is it for now. I'm Ted Simons. Thank you so much for joining us. You have a great evening.

HOA Laws Lawsuit

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  • Several bills making changes to Homeowner Association laws in Arizona were approved by the state legislature this past session. The HOA bills were tacked onto election law bills. Critics say that violates the single-subject rule, which prohibits placing multiple topics into one bill. The Center for Law in the Public Interest has filed suit against the new HOA laws. Attorney Tim Hogan of the center will talk about the lawsuit.
  • Tim Hogan - Attorney, The Center for Law in the Public Interest
Category: Law   |   Keywords: HOA, legislature, arizona, ,

View Transcript
Ted Simons: Good evening. I'm Ted Simons. Lawmakers in the last session approved changes to the way homeowners associations are run. But the changes were pushed on to an elections bill and critics say the resulting law violates the state constitution's single subject rule. Attorney Tim Hogan is with the center for law and the public interest. They have filed suit. We're talking about election bill law and HOA changes at the last minute?

Tim Hogan: At the last second on the last night of what had been a really long legislate of session this HOA bill that covered a multitude of subjects related to HOAs from who you can rent property to the size of signs you can put in your yard and things like that, was added on to this elections bill at the last minute on the last night of the legislative session. What is interesting is this HOA bill had previously died in the session. It had been a separate bill earlier in the session. It passed the house but it didn't go anywhere in the Senate and it died, so here in fact the same bill had been vetoed by the governor the previous year. So fortunately the constitution prohibits this kind of stuff.

Ted Simons: Let's talk about this. Why did you file suit and why do you think it violates the constitution?

Tim Hogan: The constitution prohibits the legislature from combining more than one subject into a bill. It's called the single subject rule. And the same provision of the constitution requires that every bill have a title and that the title describe the contents of the bill. So in this case we have a bill that ended up with a title called elections. Even though more than 50% of this bill has to do with homeowners associations. But the purpose behind a single subject rule is to prevent what's called log rolling where you can have two separate bills with minorities supporting those bills, they can combine into a majority even though they are on vastly different subjects and get it passed.

Ted Simons: And that is a violation of the constitution.

Tim Hogan: Absolutely.

Ted Simons: Okay. Behind the HOA laws, found life at the last second. She is quoted in the republic or capitol times I can't remember which the rules committee staff found that the HOA reforms were germane to the elections bill. How do you respond?

Tim Hogan: Well, that's just silly. I mean, the HOA provisions are totally unrelated to the elections bill. Despite the fact that there's one sentence in the HOA bill having to do with being able to vote electronically.

Ted Simons: I think there's something about political sign usage as well. For elections.

Tim Hogan: There are. But that's not about government elections, which is the subject of the reform bill. That started out addressing principally in-kind contributions for candidates.

Ted Simons: The HOA mention apparently in the title because again I guess the Senator thought it was germane, the title didn't need to be changed because they all fit together.

Tim Hogan: I'll tell you the real life story of this. Our client in the lawsuit is HOA activist who follows all the HOA bills. He will been dogging the bill earlier in the session. So he's been around long enough he knows just because it died in the Senate didn't mean it wouldn't come up later but because the title only fit elections and was done on the last night he had no notice whatsoever they were making this massive change and resurrecting this bill and layering it on top of an elections bill.

Ted Simons: Is that part of your suit, that you claim it's somewhat misleading if you don't know X is being debated because X is being swallowed up by Y?

Tim Hogan: We have set that out in the complaint, sure. If he had had notice he might have been able to do what he had done previously, to contact legislators, state his objections to the bill, why it should be held, and it was held previously.

Ted Simons: I think was it two HOA activists, folks involved with HOAs, you filed on behalf of them?

Tim Hogan: Correct.

Ted Simons: Is it the whole nine yards or just the title?

Tim Hogan: The whole nine yards. There's a particular provision we haven't talked about that allows HOA management companies to have one of their employees represent the HOA in small claims court. You know in small claims court you can't have a lawyer, so the homeowner goes into small claims court by himself with no lawyer, but now the HOA's management company can have one of their executives or officials come into court and represent the HOA, and he was particularly upset about that provision being included in the bill.

Ted Simons: Okay, if the court agrees on the single subject violation does that mean the entire law is struck down or just half of this?

Tim Hogan: If the court agrees that it violates the single subject rule, that you have two different subjects and we clearly do here, the entire bill is voided. If, on the other hand, alternatively the court says, well, not going to reach that issue, the title covers only elections and so therefore the elections components will survive, that means all of this HOA stuff would go away.

Ted Simons: So there are two possible out that I guess people you're working with would be looking forward to.

Tim Hogan: Correct, but I also represent clients who have interest in the election reforms who wouldn't mind that bill going away as well.

Ted Simons: Alright, so again, we're looking at single subject rule here and the idea that I guess what you're saying is if you want two separate things, go ahead and put them in two separate bills, address the separate bills, don't put them together because you're not supposed to do that.

Tim Hogan: That's the way this started out until they decided to violate that provision on the last night of the session.

Ted Simons: Alright, good to see you again. Thanks for joining us.

Tim Hogan: You bet.