Dive Brief:
- Arizona Gov. Doug Ducey (R) has signed House Bill 2123 into law, easing the conflict-of-interest rules that apply to members of the Arizona Corporate Commission. The change allows newly-appointed Commissioner Andy Tobin to participate in regulatory proceedings about rooftop solar.
- Tobin was forced to recuse himself from such proceedings after it was revealed his son-in-law is employed by SolarCity, the leading U.S. residential solar installer and a major participant in Arizona utility proceedings. Opponents argue resolving the conflict by changing the law is wrong.
- Tobin was recently appointed by Ducey to replace Susan Bitter Smith, who was forced to resign due to a separate conflict of interest controversy. The new law allows commissioners to vote on matters pertaining to industries in which relatives work if the relative is not in management or have budget authority.
Dive Insight:
Opponents of the conflict-of-interest bill argued in a March letter that Tobin should resign and questioned the legality of a Republican-controlled legislature rewriting rules to advantage a Republican gubernatorial appointee.
The ACC regulates the state’s utilities, not private sector businesses like SolarCity, but the installer has been an important factor in many recent decisions made by the commission. Tobin has had to recuse himself from pivotal recent proceedings involving solar rate design.
Decisions in such proceedings can have a significant impact on both utility and solar company finances. When Nevada regulators slashed net metering rates in December, for instance, several major installers, including SolarCity, shuttered operations and left the state.
The ACC is currently hearing a contentious rate case for UES Electric and a solar cost-benefit proceeding involving Arizona Public Service, among others.
The new law, which makes the standard for regulators similar to the standard for lawmakers, still prevents public officials from financially benefiting from decisions, according to Ducey’s office.
Tobin was appointed to the ACC earlier this year after the resignation of former Chair Susan Bitter Smith. Her departure was due a separate conflict of interest controversy involving her work as the head of a cable association whose members had business before the commission.
