In 2015 SRP became anti-solar when it adopted special solar rates (E27) with some high demand charges, etc. SolarCity, later acquired by Tesla, challenged SRP’s discriminatory solar rates on antitrust grounds. SolarCity/Tesla took the case to the Supreme Court after a lower court rejected its request to dismiss the case. SRP reached a settlement with Tesla before the Supreme Court hearing, and the discriminatory fees were left in place. As part of the settlement SRP agreed to purchase a 25 megawatt/100 MW-hour battery energy storage system from Tesla. This meant that the basic reasons for the lawsuit, challenging the discriminatory rates, were not subject to court review and a chance to rule against SRP. The Center for Biological Diversity filed an Amicus brief against SRP’s motion to dismiss in order to have the Supreme Court consider the antitrust grounds.
The SRP rates have been proven to stifle rooftop solar, reducing new installations in SRP service areas while installations in other areas of Arizona increased. SolarCity claimed that SRP’s discriminatory solar rate structure is an obstacle to clean energy transition, because it undermines the value of homeowner investment in these systems. The solar rates were not examined by the courts, SRP basically claimed that it was exempt from regulation in this situation.
The Center for Biological Diversity is an Arizona-based non-profit environmental organization dedicated to the preservation, protection and restoration of biodiversity, ecosystems, and public health. On behalf of its more than 1.5 million members and online activists nationwide, including more than 890 members, and over 15,000 supporters, who live in SRP service territory, the Center advocates for a rapid transition to a clean and just energy system that optimizes renewable energy sources such as distributed solar in order to reduce U.S. greenhouse gas (“GHG”) emissions and combat climate change.
The Center filed an Amicus brief to present three discrete arguments against SRP’s motion to dismiss. First, SRP should not be permitted to rely on state action immunity to shield its discriminatory rate structure from antitrust liability, and certainly not at the pleading stage. Second, state-action immunity for utilities like SRP should in any event be constrained to open the door for distributed solar competition. And finally, SRP is violating the Equal Protection clause because its anti-solar electricity rates have no rational basis.
Charles W. Thurston has a good article on this subject in CleanTechnica: