Connected Commerce Council Releases New Report: Arizona’s Digitally Savvy Small Businesses Outperform During Pandemic

Washington, D.C. (September 08, 2020): The Connected Commerce Council (3C) today released a report detailing how small businesses nationwide that embraced digital tools early are generating more revenue than their peers, and that Arizona small businesses are using digital tools more and expecting 2020 revenue that exceeds the national averages. The report highlights the existence and importance of the small business “Digital Safety Net,” which 3C defines as the free and low-cost small business services that include communications and workflow tools, digital marketing and advertising, websites and social media, back-office tools, and e-commerce and online payment tools.

Digitally Driven shows that nationally small businesses that embraced digital tools the earliest – “Digital Drivers” – expect 4x better revenue for 2020 compared to “Digital Maintainers,” those who are generally skeptical of digital tools’ value and typically use only a few basic tools such as email and perhaps a website. In Arizona, 49% of small businesses are digital drivers compared to 35% nationally with a predicted 9.75% in revenue reduction compared to an expected 16% reduction in revenue nationally.

“In times like these, when in-person commerce is limited, if not impossible, and working from home is the norm, digital tools literally are a safety net preventing deeper small business calamity,” said 3C President Jake Ward. “The Digital Safety Net is real. However, the net could — and must — be bigger, more robust, and more inclusive. Small businesses must invest time in selecting the right digital tools for their business; technology companies must help small businesses access the right tools; and policymakers must invest more money in public-private partnerships that create and support small business resource networks.”

Other key findings in the report include:

In addition to the 49% that were digital drivers:

  • 23% of Arizona small businesses are “Digital Adopters.” They recognize the value of digital tools and are using some, but are not fully committed to digital, compared to 33% nationally
  •  24% of Arizona small businesses are “Digital Maintainers.” They are generally skeptical of digital tools’ value or are tech-nervous, and typically only use a few basic tools such as email and perhaps a website, compared to 33% nationally

Comparing the 50 states, those with a higher incidence of Digital Drivers show stronger small businesses resiliency than those states with more Adopters and Maintainers.

  • The states with the most Drivers and best-expected 2020 revenue are:

Nevada (63% Drivers, 5.26% revenue growth)

Alabama (51% Drivers, 6.61% revenue reduction)

Arizona (49% Drivers, 9.75% revenue reduction)

Georgia (40% Drivers, 10.75% revenue reduction)

Colorado (47% Drivers, 12.45% revenue reduction)

  • 71% of Arizona small businesses increased their use of digital tools during the pandemic, compared to 72% nationally.
  • Pre-COVID-19, 69% of Arizona small businesses found digital tools either “essential” or “important” to their business, compared to 68% nationally.
  • Arizona small businesses cited three key challenges to adopting and expanding their use of digital tools: 37% cite being unsure about return on investment, 52% cite cost, and 56% cite information and skills gaps.

“When COVID-19 hit, I was seriously concerned about the future of my business,” said Eli Crane of Bottle Breacher in Tucson, Ariz. “Luckily, we were already familiar with a number of digital tools that proved critically important during the crisis. These tools were definitely instrumental to our survival.”

The report also recommends that small businesses maximize their digital tool use and become better prepared for the next crisis, and provides a playbook for tech platforms, governments, and NGOs to support small businesses today and into the future.

For small businesses, it is critical to identify their goals, gaps, and precise needs to ensure they are investing in the right digital tools – not the most popular or least expensive options. For technology companies, helping small businesses discover which digital tools they need and
providing confidence-building skills training and user-friendly support materials will help with the knowledge gap that prevents many companies from taking the digital plunge. And for policymakers, the need is to increase funding of small business resources and create public-private partnerships to address access and education barriers that small businesses experience during tough economic times.

Digitally Driven, commissioned by 3C in conjunction with Google and Greenberg, is based on findings from a nationwide survey of 7,021 small businesses that were still in business, including a representative sample from every state in the country. Data are weighted by gender, ethnicity, region, business size, and vertical, to ensure an accurate national representation. The survey was fielded online and by phone between May 28 and July 3, 2020.

The full report can be found here.
A summary of the report and its key findings for Arizona can be found here.

About 3C: The Connected Commerce Council is a non-profit membership organization with a single goal: to promote small businesses’ access to essential digital technologies and tools. 3C provides small businesses with access to the market’s most effective digital tools available, provides coaching to optimize growth and efficiency, and cultivates a policy environment that considers and respects the interests of today’s small businesses.

Tech Policy and the 2020 Election: Antitrust and Big Tech

By: Jennifer Huddleston

Introduction

Is Big Tech too big, and do companies such as Facebook, Apple, Google, and Amazon need to be broken up via antitrust action? Have we moved into a new age of “cyber barons”? Criticism of large tech platforms and discussions of antitrust action have come from both the left and the right recently. Many of these criticisms do not reflect the underlying principles of antitrust law, but instead reflect other policy concerns such as data privacy and content moderation. Given the criticism from both sides of the aisle, it is not surprising that both presidential candidates have suggested that they would engage in further antitrust scrutiny of large tech platforms if elected.

Liberal Criticisms Regarding Existing Standards

Democratic criticisms of current antitrust largely suggest that enforcement is not aggressive enough and does not account for practices that harm workers and stifle competitors but are not seen in economic harm to consumers. For example, the Biden-Harris platform supports modifying antitrust laws and ties the need for such modifications to “empowering workers.” More generally, criticisms from the left argue that the current approach to antitrust law does not properly account for all the harms to a market by large firms’ behavior and that a more flexible, policy-based approach should be used for more zealous antitrust enforcement.

There are two main problems with such criticisms. First, a more flexible and broad policy-based approach to antitrust would create greater uncertainty for consumers, innovators, and competitors. The prior rule of reason approach stifled beneficial mergers or changes out of an unjustified concern. This approach also tends to focus on the impact on competitors rather than on consumers’ welfare and a properly functioning market.

Second, even the supposed problems have not been shown to be truly harmful or even actually exist. Arguments about the use of data for house brands by Amazon is not that different from the behavior traditional retailers such as Target or Walmart have engaged in for decades. The idea of a “kill zone” (where big tech companies buy out small companies before they can challenge them) appears to be largely a myth and instead has provided more options for startups and investors as well as improved products for consumers. Concerns about market concentration often miss changes in market dynamics or differences in competition at a local versus national level.

Moving away from an objective standard of antitrust might not benefit the very consumers competition law was intended to protect and risks providing a dangerous way for political motives to intrude into an already competitive market. Such politicization could increase the abuse of antitrust law such as the Trump Administration Department of Justice’s alleged use of antitrust to review mergers in the cannabis industry based only on its dislike of the product.

Conservative Critiques of Antitrust

Calls to break up Big Tech have not only come from the left but also from policymakers on the right. Conservative criticisms often allege that the companies are abusing market power to silence conservative voices and argue that breaking these companies up would solve a litany of non-competition related policy concerns. The Department of Justice during the Trump Administration has been actively pursuing potential antitrust claims against the largest tech companies. The president himself has suggested more use of antitrust law against large tech companies, even applauding European Union fines against American tech companies. But as with the criticisms from the left, these proposed solutions might make the alleged problems even worse.

Breaking up “Big Tech” would not solve concerns about anti-conservative bias, content moderation, data privacy, or any of a litany of non-competition policy concerns. Such a policy motivation is not the appropriate use of antitrust and would be better addressed by more targeted policy reforms if needed. In fact, using antitrust to require a breakup might even make these problems worse. Smaller firms would have more limited resources to devote to tasks such as content moderation or data security and might find themselves engaging in more advertising or data usage without the efficiency of a large company. The result is far from a guarantee that these now separated companies would better respond to these policy concerns or be more friendly to conservatives. As former Senator Rick Santorum recently wrote, “Going back to the media of 25 years ago would not go well for the President or for conservatives…. As America wrestles with so many tough issues and prepares to select its leaders in a charged partisan atmosphere, social media matters. And social media matters more to the election prospects for conservatives than it does for progressives.”

Using antitrust for more political purposes not only risks undermining those purposes; it risks unnecessary government interference in a free and competitive market. The result again could easily be that consumers lose out on potential mergers or efficiencies that would have benefited them. In some cases involving technology, the result could even be an increase in costs for once zero-cost products.

Conclusion

The current approach to antitrust is principled and objective with a focus correctly on consumers. As a result, it is a tool to allow competitive markets to continue to flourish while providing a principled mode of correction when anti-competitive behavior arises. Such a standard is adaptable to fast-moving, innovative fields as well as more traditional markets. As conversations around antitrust and Big Tech are likely to continue under either a Trump or Biden Administration, proposed changes to antitrust would likely bring with them new problems as well as fail to cure existing ones.

Jennifer Huddleston is the Director of Technology and Innovation Policy at the American Action Forum.  @jrhuddles

Christine Jones – The Best Choice To Upgrade Congress

Congress needs more individuals who understand and know how to apply technology effectively and safely.

Within just the last 25 years, we have seen the number of computers on the internet explode from under 500,000 to now about two billion. It’s phenomenal and its only going to increase and advance at a faster pace.

In many ways the laws we live under are still trailing the science and technology – in some cases by decades. That has to change. Our lawmakers and especially our Congress needs an upgrade.

Case in point: the use of aerial drones for a variety of reasons including entertainment, commerce or public safety. Just within the last year, local, state and the federal government have been rushing to accommodate their use while balancing privacy, commerce and public safety. We need individuals who can look forward and catch our laws up with science and technology.

Christine Jones is that person and its one reason why she’s the best qualified candidate to send to Congress from Arizona.

Christine understands the vastness and capabilities of technology but she also grasps the rate of change it is having on the culture and our laws.

Christine Jones

Christine Jones testifying before Congress.

As the General Counsel for one of the fastest tech companies, Go Daddy, she was on the cutting edge of integrating technology and the law. She has testified numerous times before Congress advising and educating those writing our laws on how best to do so. She has played a key leadership role in making the Internet safer for children and industries.

Christine Jones is also the founder of the Internet Registrar Summit which brought international Internet business leaders together on an annual basis to establish an industry best practices that advocated for laws and guidelines for conduct and usage. Through her leadership, she has played a key role in establishing the Internet as a safe, secure and stable place for all users and especially children.

Voters in Congressional District 5 should look ahead to the future. Sending someone to Congress who knows how to marry the law with an ever-changing world of technology would raise the level of expertise in updating our laws. Christine Jones is the right person to serve in that leadership role and it’s why we need to elect her to Congress in November.

 

Orchestrated Confusion Over UniSource Proposal at Lake Havasu Corporation Commission Hearing

Reading the latest news story in the Lake Havasu News Herald, it would appear that operative from the rooftop solar industry have caused just enough confusion among ratepayers that the latest proposal to bring economic sense and equity to the energy market will require yet another hearing.

Thursday, in accordance with Arizona law, the Arizona Corporation Commission conducted a hearing in Lake Havasu to hear from ratepayers over a request by UniSource to modify its rate structure in order to iron out inequities in the way customers purchase electricity from the UniSource portion of the grid.

One of those changes would be the implementation of “demand charges” – a concept that charges a customer based on the highest demand placed by that customer during a given unit of time. Most demand is placed on the entire grid during early morning hours and early evening hours when users turn on more electrical loads in their households. It is at that time that the grid experiences its heaviest loads that ultimately costs in maintenance, repairs and even brownouts. (Read my earlier post on this concept.)

The UniSource request would allow the utility company to recover the costs of this demand while reducing costs during non-peak demand times.

Additionally, the request would also allow UniSource to adjust the price it purchases (credits) energy from rooftop solar users through net metering. Currently, that rate is sold back to utility companies at an inflated rate. That inflated rate is shifted to non-solar users who pay the difference causing an economic inequity. There are far fewer rooftop solar users than non-solar users so non-solar users are burdened by this rate inequity.

If approved by the Arizona Corporation Commission, UniSource’s request would not take effect until 2017 and rooftop solar users who purchased or began their leases before June 1, 2015 would be grandfathered into the proposal.

The political takeaway of this is that the rooftop solar industry has partaken of this form of corporate cronyism for too long. Because of a nationwide agenda to pick winners and losers in the energy sector, the solar energy industry has been heavily subsidized and given special breaks through policies like net metering. The industry cannot survive without some form of government intervention and when government pulls out and allows the market to adjust, these companies oftentimes go bankrupt leaving consumers on the hook and employees without jobs.

Here in Arizona, the battle to keep net metering in place is being waged at town hall meetings like we see in Lake Havasu.

NonSolarCustomers

When a utility company like UniSource proposes a innovative compromise to allow the free market to adjust properly to the benefit of all consumers, they are met with chaos and confusion orchestrated by the rooftop solar industry. These companies pay their lobbyists to circulate among a community to stoke the fears of ratepayers and senior citizens on fixed incomes.

What they won’t tell you is that they want a bigger bite at the apple of government subsidies and special deals. Meanwhile, its the ratepayers who bear the burden – those who cannot afford $40,000 systems and those who were told sunny days were ahead when they leased one.

Corporation Commissioners will conduct another hearing in Lake Havasu sometime in the next two weeks.

There’s Nothing Conservative or Independent About the Current Rooftop Solar Industry

Rooftop solar is one of the greatest technologies one can invest in these days. The cost of the rooftop units are coming down; it allows individuals to move toward self-sustainability; It reduces our dependence on foreign oil; and it even allows individuals to go entirely off grid and operate independent of utility companies.

So why would I make a statement about rooftop solar not being conservative?

Don’t get me wrong. If I had the means, I’d take my entire home and business off the grid for the reasons I listed above.

It comes down to one word – Independence.

A few years ago, I jumped on the anti-utility bandwagon over net metering and the push to reduce the retail rate. I had to suspend common sense and all those years of economic education to make the argument. I didn’t have the whole picture and the mountains of research to back up that claim.

315344_AZHomesSolarPanelsThe rooftop solar industry is dependent on taxpayers – especially taxpayers who don’t have rooftop solar units installed on their rooftops. That’s consumers like me who cannot afford to lease a product and service that relies on subsidies from consumers like me. To clarify, rooftop solar is still too expensive that average consumers have to sign a lease over a long-term period in order to make it affordable.

[If you’re gonna invest in technology that gives you independence, pay cash. It really is a liberating experience not owing anyone money – including rooftop solar companies!]

The rooftop solar industry is also part of broader political agenda by those typically on the left and in environmental movement who seek to eliminate all non-renewable forms of energy production. This comes at a tremendous cost – especially to consumers.

Integral to this political agenda, policy makers and rooftop solar executives have created a climate in order to make an expensive industry appeal to average consumers. It comes down to manipulating the market and creating artificial incentives in order to attract more consumers to its product.

Imagine if the top executives of Mercedes, Jaguar and Rolls Royce sent their lobbyists to Washington to obtain taxpayer subsidies so they could attract you into a lease of one of their vehicles? You sign a lease to get into their car. They get a break through some tax loophole and the cost of taking care of our roadways is passed on to the individual who can only afford to drive a 10-year-old used car.

The reality is that many solar companies cannot even operate as a viable business without some form of government subsidy. It’s a clear example of corporate cronyism that puts taxpayers at risk or worse, leaves them footing the bill when the company goes bankrupt – as we’ve already seen several times.

[pullquote align=”left” cite=”” link=”” color=”” class=”” size=””]The reality is that many solar companies cannot even operate as a viable business without some form of government subsidy.[/pullquote]

The rooftop solar has been benefiting from these market manipulations through the policy of net metering. They tell you that you can sell your solar-generated electricity back to the utility companies and pay less for your overall electricity. On a self-interest level, that’s great. But what they don’t tell you is that you’re selling back that electricity (actually, you’re receiving a credit) at an inflated rate and someone else is paying for it – a redistribution of utility costs.

Rooftop solar companies don’t own the grid and they don’t pay for the cost and maintenance of the grid. And because utility companies are paying above-market inflated rates, the cost of maintaining the grid is being shifted over to those without solar technology.

In effect, the rooftop solar industry has created a whole new level of dependency. They’ve made leasing consumers dependent on them. They’ve become dependent on net metering policy and utility companies have become dependent on non-solar customers. And when a solar company pulls its plant out of a state like what recently happened in Nevada, they leave a whole lot of people without jobs. There’s nothing sustainable about the overall climate and policy in which the rooftop solar industry operates.

In a perfect world, everyone would be able to afford solar technology without signing a long-term lease contract with the rooftop solar industry. We wouldn’t have to rely entirely on the grid and utility companies wouldn’t have to worry about covering the cost of maintenance in order to provide a reliable source of electricity.

To move toward that perfect world, we can start by eliminating the policies that pick and choose winners and losers through subsidizing and manipulating the energy marketplace.

That’s where real independence can begin and energy independence can thrive.

Net Metering Tax Credits Discriminate

Recent legislation providing solar tax credits for residential homeowners has allowed billionaires, corporations, and Wall Street financiers to profit at the expense of working class Americans.  Solar corporations leasing panels to home owners, rather than selling, have reaped the financial benefit of solar tax credits intended for home owners to the tune of hundreds of millions.  These tax credits to solar companies have boosted dividends for their shareholders at taxpayers’ expense, while panel-leasing home owners get no immediate financial benefit.

meterWorse.  Solar tax credits discriminate against lower income communities.  Group housing, where many lower income families reside, cannot install residential solar panels, and are therefore not eligible from the get-go for these special tax credits.

Arizona is subsidizing the solar industry with $1.2 billion on residential solar, and not a dime goes to the state’s lowest income sectors – yet, another reason not to have discriminatory solar tax credits.

Further, after residential panels are installed at huge costs to taxpayers, the system of net metering goes to work, also discriminating against the working class.  Owners of solar panels can buy power from the grid as needed, or ship surplus power back to the grid when they produce more than they use.  Under net metering, solar panel owners, however, avoid paying for the service and repairs to maintain the grid.  These costs to maintain the grid are then shifted to non-solar users, placing a higher financial burden on this group, resulting in a disproportionate share of the burden falling on the aforementioned lower income sectors.

In Arizona, taxpayer subsidized solar panel ownership has led to the adding of “environmental programs cost adjustment factor” and renewable energy fees on utility bills, raising financial burdens for all non-solar users, lower income families included.  For example, the city of Scottsdale has a median family income of over $92,000.  Just in the past 5 years, they have had over 1,200 solar installations, which are eligible for state and federal subsidies.  In contrast, an area in south Phoenix with 29,000 residents and an average income of $41,000 has only 45 residential solar installations.  This is just an example, but the statistics are undeniable:  Taxpayer subsidies go to wealthier communities by a factor of 26 times more than lower income communities.

Regressive solar tax credits should end immediately.  Why have we chosen one industry over another?  And worse, we’ve chosen a discriminatory industry that keeps lower income communities down by unfairly forcing them to pay for others solar installation and operation.  Under any sun, these policies are just plain wrong.

Joe Galli

Former Executive Director – North Scottsdale Chamber of Commerce

Tony Rivero: Cell Phone Carriers’ Back Room Deal Could Cost 10,000 Lives a Year

By Peoria City Councilman Tony Rivero

Tony Rivero

Peoria Councilman Tony Rivero

Many people would be surprised to find out that emergency dispatchers often can’t locate them if they dial 9-1-1 from a wireless phone. Earlier this year, the FCC proposed a rule to update their standards, which they estimate could save 10,000 lives a year. This proposed rule will help 9-1-1 professionals and emergency responders locate wireless callers more quickly and accurately.

While modernizing the existing FCC standards to correct these clear flaws in our current system seems like a no-brainer to law enforcement and public safety officials, the cell phone carriers are working on a backroom deal with the Association of Public-Safety Communications Officials (APCO), a public safety trade association, to delay this lifesaving rule.

People call 9-1-1 because they are in desperate need of help. All too often, these individuals are in medical distress, a victim of a crime in progress, unsure of their location, or otherwise unable to communicate. The time lost as first responders try to locate callers often leads to tragic outcomes of those emergencies.  We cannot allow another insider deal to delay the FCC’s original proposed rule by years, costing thousands of additional lives.

While we have had so many technological advances in the way we communicate, our ability to find 9-1-1 callers has not kept pace.  Luckily, the technology to correct this problem exists today, and the FCC’s proposed rule outlines a realistic two-year path to location accuracy for all wireless 9-1-1 calls.

We’re accustomed to backroom Washington deals costing us taxpayer money, but the cost of thousands of lives is unacceptable.  We need to tell the FCC to stand firm and reject any carrier-backed deal that would delay or alter the provisions of this lifesaving rule as it was proposed, so our law enforcement officers and first responders can stop searching for callers and get back to saving lives.

Tony Rivero currently serves on the Peoria City Council and is a candidate for the Arizona House of Representatives in Legislative District 21. Find out more about Tony at TonyRivero.com.

Maricopa GOP Chair Rallies LD Censures

To all Arizona County and LD Republican Committee Chairmen –
Below is the front page article of the July 15 Arizona Capitol Times. I want to express my appreciation to those courageous and principled County and LD Republican Committees who have already conducted votes of “censure” and/or “no confidence.”
Jan Brewer, the legislators and their crony capitalist friends that support ObamaCare and Medicaid expansion have betrayed Americans, Arizona Republicans and the Republican Party Platform.  Their lack of ethics, integrity and egregious acts are motivated by only two things – greed and the lust for power – at the expense of hard working tax paying Americans.
The law was expected to cost $898 billion over the first decade when the bill was first passed, but this year the Congressional Budget Office revised that estimate to $1.85 trillion.  Money that will have to be borrowed from the Chinese or printed in the backroom of the Federal Reserve.  Latest polls indicate a majority of Americans are opposed to ObamaCare and Medicaid expansion with an overwhelming majority of Republicans in opposition.
During the past six months, we did everything we could to make a solid argument against ObamaCare and Medicaid expansion, we tried to reason with these people and even tried to make them see the light.  Unfortunately, our lobbying efforts fell on deaf ears and without success.
During one of Ronald Reagan’s difficult political battles he said,
               “When you can’t make them see the light, make them feel the heat.”
I’m asking all the County and LD Republican Committees to make these people feel the heat by passing public censures for their actions.  They are elitists who think what they have done should be forgiven. They are mistaken.  We are not going to be able to defeat all of them, but we can defeat a majority of them in the 2014 Primary Election.
You can go to “MCRC Briefs” and get examples of public censures that have already been passed.  http://briefs.maricopagop.org/  Just type “censure” in the search field on the left.
Warmest regards,
 A. J. LaFaro
Chairman, Maricopa County Republican Committee
P.S.  Please encourage all of your PCs to keep up their daily efforts in getting petition signatures for www.urapc.org  Getting ObamaCare and Medicaid expansion on the November 2014 ballot will be historic for Arizona’s grassroots conservatives.

What’s Good for APS Is Not Necessarily Good for Arizona (or Solar)

The typewriter, the phone book and the payphone had their day, and the businesses that relied on them either got busy changing or got busy dying.

Despite claims made by Arizona Public Service, the utility thus far has not been open to options on net metering. APS has been trying to kill rooftop solar in Arizona, or at least change the rules to have this effect.

photo by Gage Skidmore

photo by Gage Skidmore

Rather than innovate or find ways to profit from solar power, APS decries the solar industry and opines that its revenue is heading downward. That’s not the solar industry’s problem. That’s not the ratepayers’ problem. That’s a problem for APS shareholders, and that must not be our state’s concern.

Instead of trying to fix the problem, APS is trying to fix the game. It’s looking to rig the system so the utility doesn’t have to pay fair market value for the excess electricity that rooftop solar customers send back to the grid. That’s the essence of “net metering.”

The bottom line is that this will impact APS’ bottom line. And what APS is saying is that it doesn’t want to make less money.

Rather than try to outlaw smartphones, Bill Gates developed the Windows phone. Phone companies provide cable TV service. Cable TV companies provide internet service. Internet-based companies are carrying television programs and movies. In the private sector, you either innovate or evaporate.

APS executives should have embraced net metering and seen the potential for profits. Now that they have missed the boat, they want to sink it. They have been around for so long and are so set in their ways that they don’t understand that what’s good for APS isn’t necessarily good for Arizona.

APS enjoys a healthy profit margin. Its profits have increased by more than 50 percent since 2008. Its long-term financial forecasts cite solar energy as competition that could impact profits. But instead of trying to figure out a long-term solution, APS is trying to convince the Arizona Corporation Commission to change the rules so its shareholders will continue to see generous dividends. That’s not capitalism; that’s cronyism, and I firmly believe those serving on the ACC will side with energy choice and ratepayers and stand against a utility that would rather change the rules than change its ways.

Indeed, APS’ efforts to crash the future of solar power in this state are the very reason I applauded the ACC for taking the first steps toward more utility competition in this state.

***

Former U.S. Rep. Barry Goldwater Jr. is chairman of the group Tell Utilities Solar Won’t Be Killed. He can be reached at dontkillsolar@gmail.com.

APS Stock Price, Profits Should Be Secondary to Arizona Solar Energy Consumer Choice

During their last earnings call, as reported in the Arizona Republic, Arizona Public Service (APS) CEO Don Brandt was asked about the financial impact rooftop solar could have on APS if solar’s popularity continued to soar.

RooftopSolarJust like the public education monopoly, the APS utility monopoly is concerned that more energy efficiency and choice, specifically more rooftop solar, is starting to eat into its profits and revenue growth.  APS clearly disclosed this to its investors when it revealed that between now and 2015, it expects its electricity sales to grow by less than 1% even though its customer base will grow 2% annually. The reason? APS customers are investing in more energy efficiency with rooftop solar being the primary technology of choice.

Frankly, how APS addresses this with investors is no concern of mine. And neither should it concern the Arizona Corporation Commission.  A more innovative future with more energy choices for Arizona consumers should not and must not be dictated by the utility’s bottom line. By that same logic, we would have harnessed the Internet because of the challenge it posed to newspapers and many other technologies.

I would think by now that any astute energy consumer would recognize that APS’s sudden concern about the proliferation of rooftop solar in Arizona has nothing to do with empathy for Arizona ratepayers.  It has everything to do with curbing a disruptive technology growing quickly in their existing marketplace. As one pollster has opined, allowing APS to do this would be “political malpractice.”

But there appears to be a far greater threat to APS’ stock price (PNW) on the horizon and that, fortunately for consumers, is a healthy competitive change.  Because of their blatantly naked attempts to kill independent solar in Arizona, along with other reasons, the Arizona Corporation Commission is rightfully looking at opening up more utility competition in Arizona.  In fact, they took the first step down this path last week. Kudos to Chairman Bob Stump and Commissioners Gary Pierce, Brenda Burns, Susan Bitter Smith and Bob Burns for their actions. Clearly, APS’ effort to thwart more solar choice in Arizona is exactly why we need more competition in Arizona.

Choice and competition – these are concepts all conservatives can rally behind.  And it is one all Wall Street stock investors will surely be watching.  The bottom line for consumers is we simply cannot have a better energy future in Arizona if the primary focus is on APS profits rather than innovation and competition that always best serves the marketplace.