State GoalS
Arizona is committed to 100% zero-emission energy by 2050 with a 45% renewable energy portfolio by 2030. The state also plans to eliminate coal by 2031, which is seven years sooner than previously projected. This is big news since coal-fueled about as much or more of the state's electricity generation as nuclear power until 2018. Arizona's second-largest power plant, Navajo Generating Station, which was the largest coal-fired facility in the state also closed in late 2019.
Arizona's primary fuel is natural gas which was half of the state's net generation in 2020. Palo Verde Nuclear Generating Station is the state's largest power plant and the nation's largest nuclear power plant. Arizona power plants have generated more electricity than the state consumes, and, in 2019, more than one-fourth of the electricity generated in-state was sent to consumers outside of Arizona.
ExpECTED COSTS
For Arizona Public Service, the average residential bill in the first five years of achieving cleaner energy is expected to be between $3.75 and $4.58 more per month (on average) than the amount the bill otherwise would have been, had the company not pursued clean energy.
For Tucson Electric Power, the average residential bill in the first five years of achieving cleaner energy is expected to be between $0.00 and $0.21 more per month (on average) than the amount the bill otherwise would have been, had the company not pursued clean energy.
RENEWABLE ENERGY Requirements
According to the EIA, more than half of 14% of renewable energy came from solar photovoltaic (PV) and solar thermal energy in 2020. Arizona is fourth in the country amongst solar-powered electricity generation after California, Texas, and North Carolina. Arizona's renewable energy standard requirements state that regulated electric utilities must generate 15% of their energy from renewable resources by 2025. Annual requirements in 2012 and thereafter, a total of 30% of the year's required renewable energy target must come from non-utility, customer-sited generation. It is important that your Company mitigates risk by ensuring the accurate REC requirements in your offer and TRUELight Energy captures this data along with all cost components across the various independent system operator.
Figure 1: R14-2-1804. Annual Renewable Energy Requirement
oPPORTUNITY
The Palo Verde trading hub is one of the more liquid locations out in the western markets and represents the general area around the switchyard at the Palo Verde nuclear power station that is west of Phoenix, Arizona. TRUELight's proprietary forward curve values for Arizona show that prices are high right now given the drought conditions and continued heat that is gripping the western US. Our experts can advise you if your project in Arizona should be physically delivered in the Palo Verde general area or another location in the state. We have a combined 100 years of experience with PPAs, let us help guide you and find the best opportunities to meet your company's financial goals.
INTERESTING FACTS
The Grand Canyon National Park is one of the Seven Natural Wonders of the World, and the only one located within the United States.
Arizona has more Native American lands than any other state and 21 Native American tribes. In fact, only 17% of Arizona’s large landmass is privately owned, the rest is comprised of Native American reservations, public lands, forests, and state trust lands.
The “Five C’s” of Arizona’s economy are Cattle, Copper, Citrus, Cotton, and Climate.
