It was just a few years ago that Arizona was close to passing a 100 percent renewable energy mandate. Now the state is rolling back a much more modest requirement.

The reason: the changing politics of the Arizona Corporation Commission.

Republicans expanded their majority on the utility commission to 4-1 in 2022 and have taken steps since then to reverse clean energy mandates. Most recently, the panel voted 4-1 to sunset rules that required regulated utilities to set energy efficiency requirements and get 15 percent of their energy from renewable resources by 2025.

Both were backed by small surcharges on electricity bills that collected more than $3.4 billion from Arizonans since 2006.

Conservatives argue that the rules benefit only a handful of ratepayers.

Republican Commissioner Kevin Thompson told POLITICO’s E&E News that middle- to upper-income people “should be able to afford their own smart thermostats, EV charging stations or financial incentives” and “not be subsidized by the masses.”

But environmentalists point to the broad benefits of energy efficiency investments, which can lower peak demand and reduce the need for costly new power plant construction. Arizona Public Service, the state’s largest utility, reported more than $1.25 billion in net benefits from the efficiency surcharge between 2005 and 2022.

Purple state problems

It’s a real turnaround, given that a previous commission majority had nearly passed a bipartisan proposal that would have required regulated utilities to produce all their energy from clean energy by 2050. That proposal collapsed in 2021, and the Republican wins in 2022 put the final nail in the coffin.

Sunsetting the weaker 2025 renewable energy mandate may not matter much. The state’s largest electric utilities already surpassed the 15 percent benchmark and say they’ll continue to invest in low-cost wind and solar to meet skyrocketing electricity demand. Federal estimates say Arizona has the second-highest solar potential in the country, making it fertile ground for clean energy.

But the commission’s vote shows how divisive energy politics can be in battleground states like Arizona. Democrats may have taken the governor’s mansion in 2022, and President Joe Biden won there in 2020, but Republican majorities in the state Legislature and corporation commission have stymied ambitions to accelerate the transition away from coal and gas power.

Rather than reaching across the aisle, conservative legislators are introducing bills that would raise costs on renewable energy projects or make them harder to build — policies sure to meet the veto pen.

It adds up to a tough message, said Autumn Johnson, executive director of the Arizona Solar Energy Industries Association.

“It tells the renewable energy industry that Arizona is not interested in your business,” she said.

It’s Monday — thank you for tuning in to POLITICO’s Power Switch. I’m your host, Jason Plautz. Power Switch is brought to you by the journalists behind E&E News and POLITICO Energy. Send your tips, comments, questions to [email protected].

Today in POLITICO Energy’s podcast: Catherine Morehouse breaks down some big personnel changes at the Federal Energy Regulatory Commission.

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That’s it for today, folks! Thanks for reading.

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