Dive Brief:

• The Arizona Corporation Commission (ACC) on July 13 approved an amended Demand Side Management (DSM) plan for Arizona Public Service (APS), allowing the utility to continue and expand energy efficiency programs and to modify a residential energy storage pilot for grid optimization.
• The home battery program will now provide a $1,250 one-time incentive for customers who allow their batteries to be used to "serve grid needs." To be eligible for that payment, customers must make a three-year commitment to share up to 80% of their system's capacity during "events."
• The ACC's decision also expanded eligibility for an HVAC replacement program and directed APS to implement an Expanded Tribal Communities Energy Efficiency program to support American Indian communities that relied on coal plants for jobs and tax revenues. 

Dive Insight:

APS's residential storage pilot was approved in October, but in April the utility proposed a new functionality, for customers to "share" their battery capacity with the utility in exchange for an up-front payment, APS spokesperson Yessica del Rincón said in an email.

The ACC decision approved transitioning this pilot to APS's demand side management portfolio, as well as "adding the option for customers to share their battery capacity," del Rincón said.

The pilot also offers a one-time incentive of $500/kW, to a maximum of $2,500 per home, for customers who install battery systems and enroll in APS's time-of-use or TOU plus demand rate plan. Customers must also agree to discharge their batteries during peak demand periods.

"Participating customers also agree to connect their batteries to APS's Resource Operating Platform, our management site used to monitor and deploy connected devices, and share battery performance information to help inform how battery technology can be leveraged to provide grid support and create better customer experiences," del Rincón said.

APS is authorized to call on the systems up to 100 times per year. 

The residential energy storage pilot is one among 18 programs in APS's DSM portfolio, which also includes demand response, building codes, appliance standards and electric vehicle charge management. 

The tribal efficiency programs offer residential customers direct install energy efficiency products, the utility said, weatherization services and rebates for ductless mini-split heat pumps. Small businesses are eligible for free energy assessments and enhanced rebates for efficiency upgrades.

According to the proposal voted on by the commission, APS forecasts its 2021 DSM plan will provide estimated total energy savings of almost 6.8 million MWh by the end of this year, "which represents approximately 23 percent of the company's adjusted 2020 retail sales."

The Southwest Energy Efficiency Project (SWEEP) and Arizona PIRG Education Fund cheered the DSM portfolio decision.

"Energy efficiency is a phenomenal return on investment," SWEEP utility program Co-Director Ellen Zuckerman said in a statement.  "It's essential that we offer [customers] new and improved opportunities to save energy. Thankfully, yesterday's action by utility regulators does just that."