TUCSON, Ariz. (KOLD News 13) - Tucson’s energy manager spoke before the Arizona Corporation Commission opposing Tucson Electric Power’s proposed rate increases on behalf of the city, testifying the change could negatively impact Tucson overall.
The city’s main electricity provider proposed an increase that, if approved by the ACC, would go into effect May 1, 2020. Depending on their plan, average residential customers could see a $7 to $9 increase in their monthly bills. Customers on the traffic signal and street lighting plan would see an increase of $10.42 per month. And, depending on the business, business owners could see an increase from $20 to $760 per month, according to the company’s website.
The last time TEP raised its rates was February 2017.
Michael Catanzaro, Tucson energy manager, told commissioners Friday that the drastic rate hikes TEP is asking for prevents the city from properly setting a budget for the future. He said the increase will dramatically change city expenses if the rate is approved.
“The city’s responsibility is to serve its citizens and ensure their tax dollars are being spent wisely,” he said in during his testimony. “Because of this duty, it is imperative that the City object to the substantial rate increases proposed by TEP.”
Since the city’s roughly $17 million electrical bill is paid for by taxpayer money via the city’s general fund, if approved TEP’s 8 percent rate increase could cause a domino effect in other city expenses. In his testimony, Catanzaro said that 8 percent would translate to more than $500,000 expense increase across 600 accounts citywide.
Catanzaro said the increase would counteract citywide savings made through sustainable energy practices like installing LED street lights. Since the city installed those lights, it’s saved Tucson about $50,000 a month.
If approved, the rate increase would reduce those savings by $200,000 a year.
Catanzar pointed out the rate increase would help TEP invest in the coal industry, which has seen a sharp decline as more sustainable energy practices are coming to the forefront of the power industry.
“TEP is asking the Commission to approve a rate increase that goes against industry trends,” his said in his testimony. “TEP bears the responsibility of justifying and explaining, in detail, why it continues to invest in this form of energy generation.”
The commission will vote on the proposed increase sometime next year.