APS - Net Metering

July 07, 2009


Note: In October 2008, the Arizona Corporation Commission (ACC) adopted net metering rules that apply to all investor-owned electric utilities and electric cooperatives in the state. The Arizona attorney general is currently reviewing the rules, which must be certified before they take effect. After the rules are certified, utilities will have 120 days to file new net metering tariffs, and the ACC must approve these tariffs before they take effect. Until APS's new tariff take effect, the net metering program previously developed by APS will remain in place. (This program is described below.) Under the new state rules, net metering will be available to customers who generate electricity using solar, wind, hydroelectric, geothermal, biomass, biogas, combined heat and power (CHP), or fuel cell technologies. Individual system capacity will generally be limited to 125% of a customer's total connected electric load. Arizona Public Service (APS), the state's largest investor-owned utility, initiated a three-year pilot net-metering program in July 2007. Net metering is available to customers with systems up to 100 kilowatts (kW) in capacity that generate electricity using solar energy, wind energy or biomass energy. The program is capped at 15 megawatts (MW) of total aggregate capacity and is conditional on continued funding for the state's Environmental Portfolio Surcharge (EPS).* Net metering is accomplished using a bi-directional meter, which will be provided by the utility to each program participant at no charge. (The incremental meter costs will be funded by ratepayers through the EPS.) Any customer net excess generation (NEG) will be carried over to the customer's next bill at the utility's retail rate, as a kilowatt-hour (kWh) credit. Any NEG remaining at the customer’s last monthly bill in a calendar year or at the time of a customer shut-off will be granted to the utility. For customers taking service under a time-of-use rate, off-peak generation will be credited against off-peak consumption, and on-peak generation will be credited against on-peak consumption. The customer’s monthly bill is based on the net on-peak kWh and net off-peak kWh amounts. Any monthly customer NEG will be carried over to the customer's next bill as an off-peak or on-peak kWh credit. Any NEG remaining at the customer’s last monthly bill in a calendar year or at the time of a customer shut-off will be granted to the utility. * The utility's net-metering tariff states: "EPS funding will be utilized to recover the metering costs and billing-system modification cost. The net lost revenue associated with the pilot program will be deferred for future recovery and will be based on the difference between the retail rate and the utility’s avoided cost and applied to the partcipants’ excess generation."

Program Overview

Implementing Sector: Utility
Category: Regulatory Policy
State: Arizona
Incentive Type: Net Metering
Web Site: http://www.aps.com/main/account/orders/EPR/default.html
Start Date:
Eligible Renewable/Other Technologies:
  • Solar Thermal Electric
  • Solar Photovoltaics
  • Wind (All)
  • Biomass
Applicable Utilities: APS
System Capacity Limit: 100 kW
Aggregate Capacity Limit: 15 MW
Net Excess Generation: Credited to customer's next bill at retail rate; granted to utility at end of calendar year
Ownership of Renewable Energy Credits: Not addressed
Meter Aggregation: Not addressed


Name: Arizona Public Service
Phone: (602) 371-3636

This information is sourced from DSIRE; the most comprehensive source of information on incentives and policies that support renewables and energy efficiency in the United States. Established in 1995, DSIRE is operated by the N.C. Clean Energy Technology Center at N.C. State University.