On February 27, 2025, the Salt River Project (SRP) District Board held its final vote regarding its pricing proceeding. The final price plans, approved by the SRP Board, fail to fairly compensate solar customers for the energy they export to the grid, discouraging solar development and stifling the growth of clean and local energy.
Serving over 2 million customers in Arizona, SRP has long had one of the worst solar rates in the country. An elected Board of Directors makes decisions for the utility, meaning SRP operates with limited opportunities for public engagement and oversight compared to other major utilities that the Arizona Corporation Commission regulates. Leading up to the final vote, Vote Solar played a leading role in participating in the proceeding and advocating for improvements to SRP’s solar rates.
“SRP claims to be a clean energy champion, but as we have seen in the past and in today’s pricing proceeding final vote, that is not the case,” said Kate Bowman, Vote Solar’s Interior West Regulatory Director. “Rooftop solar adoption is three times higher in neighboring utility territories. This shows that SRP’s policies are discouraging families from installing solar, holding communities back from benefiting from clean, local energy.”
The SRP Board approved a new monthly service charge of $30 for a typical residential customer, a 50% increase for most homes and more than twice the average monthly fixed fee for comparable utilities. In the long run, the high monthly service charge will result in higher costs for everyone. Since a larger portion of a family’s utility bill is collected through a fixed charge, their opportunity to save money by conserving energy is limited. When families invest in energy efficiency or rooftop solar to reduce their monthly utility bills, it helps utilities avoid the need to build expensive new power plants and infrastructure, ultimately bringing down utility costs for everyone.
Additionally, SRP’s compensation for exported solar energy (3.45¢/kWh) is lower than what the utility pays to generate or purchase power, a practice that undervalues the electricity solar customers provide to the grid. Unlike other Arizona utilities that offer a 10-year locked-in solar export rate, SRP plans to update its rate annually, making it difficult for families to predict savings.
The SRP Board also committed to creating a virtual power plant (VPP) program that would compensate customers who use their battery storage to supply energy to the grid during times of high energy costs or energy shortages. The program aims to enhance the benefits of rooftop solar, but it remains uncertain if participating will outweigh SRP’s lackluster solar price plan.
“SRP is failing to embrace the clean, local energy resources that its customers want. Under these new rates, solar development among SRP customers will continue to lag far behind other utilities in Arizona,” Bowman said. “SRP had the opportunity to build a more resilient, equitable, and sustainable energy future for Arizonans. Instead, by undervaluing the power of solar, SRP is holding communities back from local economic growth, lower energy costs, energy independence and a cleaner future.”
News item from Vote Solar
private individuals and businesses that use their own capital and take all the risks in installing a solar power plant should be better rewarded. In the end it is about saving the planet, and some people act on this crisis, so they should be compensated with actual savings. SRP is not supportive of solving the larger issue, they want to maintain a monopoly and are acting defensively. The actual facts are that the grid will have to become much larger to provide energy to all the electric vehicles, electric appliances (gas is out), and new growth in Arizona (data centers, TSMC, etc.). There is no threat to the utilities in Arizona, so they all should stop acting so defensively. If every house and business had solar on its roof it would not be enough to supply the future needs. Clean solar energy is worth -more- than fossil fuel generated energy, so in fact SRP should be paying above market rates for cleaner energy than lets say – nuclear or fossil fuel based energy. There is a bigger picture here – saving the planet, it is time to see the climate crisis for what it is. Each summer now we have a whole month of 120F days – it is killing the Saguaros, what will it take to see the bigger picture?
Thanks for the coverage. I thought it was an honest assessment of what is happening and anyone spouting about SRP’s fine stewardship are uninformed and probably work for them. They have changed the rules 4 times in 12 years while making it more confusing every time. Moving the peak time of day to a later time frame, reducing the export rate many see now, along with sunsetting anyone on grandfathered rate plans in 2029 is just wrong. All while devaluing the benefit of rooftop solar is disheartening. I understand power in the middle of the day is cheap but their constant moving the goal posts only serves to make it harder and less attractive to homeowners. I say this as a 13 year solar professional and SRP customer working in AZ with all the local utilities.
[A community member, SRP customer of 16 years] I’m going to call you out on this claim: ” Rooftop solar is far less efficient than solar farms and is extremely costly. It takes decades for there to be benefits to that method while solar farms cost more than regular energy, but are much more efficient and bring returns in much more quickly than rooftop.”
Fallacy of inclusion, you submit Utility scale and are [working in the utility wholesale arena]. Solar PV Utility scale generation is still (often) centralized and sent into a grid system with intrinsic transformer step power losses end to end of 12% up to 25% in rural areas. Utility solar PV has this built in loss which end user consumers pay for in every electric bill (they are paying bundled retail per kWh used). The numbers relay utility solar PV (can be) installed for $1/watt is less interesting to the residential retail electricity rates paid for by the individual home owners. I have had two homes with solar PV installed and the first installed in 2005 had a (simple ROI) of 22 years. Over 13 years of running the home off of solar PV with a PPA with the local utility, it had paid for itself in energy savings. The system I have now was installed in 2017 $3.50/watt installed ( no ITC used) and it was projected the ROI was 14 years, it is looking right now the ROI will be in 11 years, (2028).
This is MY experience over 20 years of grid tied solar PV use for my daily energy needs. Solar PV is the (most efficient) when installed where the generation will be used, rather than pay bundled taxes, tariffs, fees for energy bought from the grid. Now prices are coming down and residential installers are offering comprehensive systems of solar PV AND smart BESS installed. Many folks (for now) at least qualify for the Federal ITC of 30% for the installation. Places like California have so many tiered rate structures, rate spiking TOU periods from 4 PM to 9 PM daily a smart BESS can be used as off peak arbitrage and solar PV capture self consumption as well as a resiliency system when one of the California utilities invokes a PSPS for hours and possibly days. Folks in California are installing 10kWp to 15kWp and storing the energy for self consumption, if they have or purchase a BEV they can pay for the system in energy savings, both electricity AND fuel. These systems have been paying for themselves in 5-7 years used in this manner. APS, SRP and TEP will have TOU rate spiking and tiered electricity rates that will increase with the filing of a rate increase due to (lost revenues) or (stranded assets). In Arizona that “stranded asset case” was the decommissioning of the NGS coal fired plant in Northern Arizona.
“It’s important to show the whole picture and given honest review.”
IT is also important to consider the intrinsic inefficiencies in the Utility transmission and delivery infrastructure and point this out (also).
While I value clean energy, this article confuses and disregards SRPs efforts to use efficient methods for clean energy, such as solar farms, and seems to imply that because clean energy is valuable, SRP should somehow bear the brunt of all those costs instead of charging customers for what customers want to purchase. Rooftop solar is far less efficient than solar farms and is extremely costly. It takes decades for there to be benefits to that method while solar farms cost more than regular energy, but are much more efficient and bring returns in much more quickly than rooftop. SRP doesn’t gain money from other sources. We have to pay for what we want. If we want rooftop solar, we have to pay those costs. If we want to have access to energy, we need to pay what is called the fixed rate, the cost of having that energy brought to us whether we are trying to save money or not. Where would SRP get the money to pay for all of this? The fact that there is a cost to getting energy and that costs have gone up everywhere is why rates are going up. It’s not a power company being selfish; they aren’t benefitting unduly–they are providing a service and as for all services, including the costs of that provision in consumers’ costs. It’s important to show the whole picture and given honest review.
“Additionally, SRP’s compensation for exported solar energy (3.45¢/kWh) is lower than what the utility pays to generate or purchase power, a practice that undervalues the electricity solar customers provide to the grid. Unlike other Arizona utilities that offer a 10-year locked-in solar export rate, SRP plans to update its rate annually, making it difficult for families to predict savings.”
Therein lies the conundrum, SRP, and APS in Arizona has ‘shuffled’ billing considerations and APS has an average bundled rate that is NOT fixed, but depending on the specific tax, tariff or fee used for the most part in any given month, will bump an APS bill $40 to $50 dollars more over the retail cost of electricity. THIS is why in California it is popular to add smart BESS or initially install solar PV Plus smart BESS so one has “flexible programming” around the next local electric utility billing change rate program.
“The SRP Board also committed to creating a virtual power plant (VPP) program that would compensate customers who use their battery storage to supply energy to the grid during times of high energy costs or energy shortages.”
At what price point? Wholesale plus $0.03 per kWh under the VPP or actual emergency and standby grid services that can be rated at up to $1/kWh over the standby or emergency power period? In a real VPP electricity spot market pricing can vacillate wildly.