News and Updates

Statement

The Commission is committed to ensuring that residential and small business customers are not and will not subsidize current and future data centers and other large energy users.  The Commission disagrees with the results of an analysis performed for the news story titled “APS filings indicate customers are on the hook for $587M through a power surcharge” for 12News that aired on October 7, 2026. 

The author, Mr. Abhay Padgaonkar, as an APS customer has the opportunity to intervene in the APS rate cases and participate in the creation of a thorough evidentiary record.  He did not choose to participate in the current APS rate case as an intervenor.  The Commission is unable to comment on the evidence in the current APS rate case as it is still ongoing. 

A deep dive into cost causation – ensuring that the utility customers that cause the costs are paying for them – is currently taking place within the process of the APS rate case.  In the pending APS rate case, the utility’s expenditures and purchases, the prudency of those purchases, and the operation of the Power Supply Adjustor are among the processes being audited by Staff and 23 other Intervenors.  The evidentiary record in the rate case includes all cost allocation methodologies, including the allocation of costs between residential and commercial/industrial customers.  All documents related to the rate case can be found in the Commission’s eDocket. For more information about APS’ proposals to prevent costs shift, including Staff’s responses in the pending APS rate case, you can go to APS’ rate case application at https://docket.images.azcc.gov/E000044763.pdf?i=1791577081015, and Staff’s direct testimony on rate design at https://docket.images.azcc.gov/E000050079.pdf?i=1791577081015.

With the recent growth of AI, data centers and manufacturing demands, the Commission maintains a “growth pays for growth” principle for new high-load customers to ensure those customers are funding any new grid infrastructure and generation costs required to serve them.  Residential and small business ratepayers are protected from those costs through the implementation of mechanisms such as new or revised extra large-load tariffs, long-term minimum capacity agreements, Energy Service Agreements, and upfront capital requirements. 

Additionally, changes to the Power Supply Adjustment mechanism follow the established procedures outlined in the Plan of Administration (POA) and does not require a Commission vote.  The PSA adjuster is an annual adjustment that would otherwise automatically go into effect after a Staff review, unless Staff requests that the Commission review the proposal, or the ACC Chair decides to include the PSA proposal in an Open Meeting agenda for discussion.   To paraphrase the POA process: APS files an annual PSA proposal in the docket by November 30 every year.  ACC staff and the Commissioners have 60 days to review the PSA proposal, and can discuss and request changes to the proposal.  If no changes are requested, the new PSA rate automatically goes into effect on February 1.  The PSA is a pass-through cost to account for actual spends by the utility and APS does not earn a profit on the PSA. 

Since the pending rate case may include changes to APS’ PSA mechanism, APS plans to file its annual reset plan after the expected completion of the rate case by the end of this year.  For more information, go to:

https://docket.images.azcc.gov/E000054740.pdf?i=1791583207489

For further information on the POA: