APS’ First Solar, Erecting a Barrier to Solar Energy Choice in Arizona

APS knows that Arizonans love solar, but it doesn’t want its customers to have the choice to produce their own electricity and lower their electricity bills.

That’s why APS has chosen First Solar – the one solar company that could never give consumers choice — as its wolf in sheep’s clothing, deploying the company to make APS’s monopoly arguments for them.

Let’s take a look at where First Solar is coming from when it attacks rooftop solar. Unlike rooftop solar companies, which provide solar electricity to individual homeowners, First Solar does utility-scale projects for utilities like APS, whose former CEO William J. Post sits on First Solar’s board of directors.

In its 2012 Annual Report, First Solar lays out in black and white that the success of rooftop solar could compromise First Solar’s ability to execute on their own long term strategic plans:

“We face numerous difficulties…including the following…Difficulty in competing against competitors who may gain in profitability and financial strength over time by successfully participating in the global rooftop PV solar market…”(p. 19). 

And that rooftop PV solar market is driven by consumer demand. The more homeowners are empowered to go solar, the stiffer the competition First Solar and APS face.

First Solar may face another difficulty: it has set aside a whopping $271.2 million to cover the costs of replacing defective modules it made in 2008 and 2009, according to public filings. But APS doesn’t need to be concerned about First Solar’s technology failing because the utility can just pass that cost on to the ratepayers as well. In fact, the more money ratepayers spend to build and fix APS infrastructure, the more money APS makes since it earns a guaranteed rate of return on all its expenditures—whether they promote what consumers want, or not. It’s good to be a monopoly.

It’s no surprise that First Solar CEO Jim Hughes, a 10-year veteran of Enron who led the infamous company’s global assets division during the height of the its accounting scandal but who reportedly escaped as an “unindicted co-conspirator”, opines that net energy metering, the policy that gives customers fair credit for the solar electricity they provide to the grid, and ultimately, to their nearest neighbors, is unfair.

Neither APS nor First Solar want Arizonans to be able to build their own solar projects, because if customers don’t have any choice among competitive solar companies, it makes it easier for utilities to build solar farms and pass on the entire expense to ratepayers. It’s not difficult to imagine APS putting heavy pressure on First Solar to step up to the mic. But that’s just another reason not to believe either of them.


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