Dive Brief:

• Arizona Corporation Commission (ACC) Chairman Bob Burns, R, proposed a process this week to move ahead on retail electric choice, directing regulatory staff to draft a proposed rules package in the next five months for full retail electric competition. 
• Burns submitted a letter to ACC's retail electric competition rules docket on Tuesday, seeking commissioner support for drafting a second proposed rule "prior to all the questions [on retail electric competition] being addressed completely," to specifically focus on full electric choice. His top concerns are grid operator jurisdiction, customer protection and choosing an electric reliability coordinator. "At least three reliability coordinating organizations are out there soliciting memberships" in Arizona, Burns told Utility Dive, referring to California ISO and the Southwest Power Pool.
• ACC staff proposed rules on retail electric competition this summer, drawing comments from the commissioners, particularly Commissioner Justin Olson, R, that the proposal did not go far enough. The ACC had previously opened a docket on retail electric competition, although Burns distinguished the new process as a "fact-gathering function" in order to determine if a new model is viable.

Dive Insight:

The last time the ACC looked into the possibility of full retail electric competition, investor-owned utilities such as Arizona Public Service (APS) were quick to criticize.

Previously, in 2013, the ACC ended an inquiry into electric retail choice after APS and its parent-company, Pinnacle West, argued that the increased competition could threaten reliability. Burns recalled that APS and Pinnacle West had spent millions to critique full retail choice, with the commissioner calling it a "scare campaign."

While APS did not reply to Utility Dive's request for comment, the utility had filed comments in July on the staff report and draft rules on electric retail competition, saying that grid reliability could be jeopardized.

"Is there a better way to do things based on the fact that we have so many more choices?" Burns said. According to him, there has been "a tremendous amount of advancement" in different generation since 2017, which would benefit the customers that are buying electricity.

Burns requested a draft of rules from ACC staff by January 10, 2020, to reflect the transition to full retail electric competition for all customers. He wants the commission to discuss the proposal at the February open meeting. The draft would offer a template to work off, which the ACC did not have in 2013.

"I'm hopeful that we've sort of changed the format of how we're going about this," Burns said. "We're keeping this in-house, if you will ... working with staff and the other commissioners."

"I hope that we won't have to go to the ballot," he added. 

However, many problems still remain to be discussed. The Arizona state law on open meetings prohibits the five ACC commissioners from meeting in unofficial capacities to discuss regulations, which means that commissioners must address their concerns during monthly open meetings. Having a concrete rules package will help the commissioners be more targeted in their inquiries, Burns wrote.

Burns called the Texas electric retail choice model a "very strong, good starting point" for Arizona. APS specifically highlighted Texas in its comments, citing reliability concerns as recent as this summer from the Electric Reliability Coordinator Council of Texas.