Proposition 127 – Clean Energy for a Healthy Arizona Act – Citizens' Initiative

What is the ballot measure? Proposition 127 would amend the Arizona Constitution to require private utilities (those that are regulated by the Corporation Commission) to obtain 50% of their power from renewable resources by 2030. The measure would define renewable energy to include solar, wind, biomass, certain hydropower, geothermal, and landfill gas energies; it excludes nuclear fuel.


Background: In 2006, the Arizona Corporation Commission (ACC) approved standards requiring regulated utilities to obtain 15% of their power from renewable sources by 2025. Those standards also established reporting requirements for utilities to demonstrate compliance with the standard. The regulation made Arizona one of 29 states with a percentage-based renewable energy requirement for utilities. At the end of 2017, regulated utilities (such as APS and TEP) were getting 10% to 13% of their energy from qualifying renewable energy resources.


Provisions:

  • Would require that private utilities obtain a progressively increasing percentage of their power from renewable energy resources each year, with an ultimate standard of 50% in 2030 and beyond.
  • Would also require that private utilities obtain a progressively increasing percentage of their power from distributed renewable energy resources each year, with an ultimate standard of 10% by 2030 and beyond. This would be energy produced at a customer’s premises (such as rooftop solar electricity) for their own use, or to sell directly to a utility.
  • Would track the renewable energy and distributed renewable energy requirements above in the form of one credit for each kilowatt hour (KWH) of energy produced from renewable sources. These credits could be transferred to another utility or between utilities, to help them meet their annual percentage requirement of KWH produced from renewable energy sources.

Impact:

Models compiled from a study commissioned by the Natural Resources Defense Council, suggest that Clean Energy for a Healthy Arizona standards would reduce energy costs by $4 billion between 2020 and 2040 while decreasing pollution and associated health and environmental hazards. This would occur whether Arizona’s Palo Verde nuclear power plant continued to operate at its current capacity, or whether it closed.

Arizona Public Service Co. (APS) funded a study by Timothy James, an ASU professor with the W.P. Carey School of Business, which concluded, in a non-peer-reviewed study using a model not available for independent analysis, that the state would lose $1.8 billion in state and $1.2 billion in local taxes, in addition to 7,000 jobs by 2060 under the measure’s standards. This study assumed the closure of the Palo Verde Nuclear Generating Station in its models.


Arguments For:

  • According to a study solicited by The Natural Resources Defense Council, electricity bills would be 3% cheaper in 2030 under the renewable energy future compared with the currently-planned gas-fired future. The cost of solar power has fallen 86% over the past eight years, and cost of wind power has fallen 67%. The cost of energy storage has fallen 79% since 2010.
  • By reducing carbon emissions from power plants that use fossil fuels, we help control exposure to dangerously unhealthy ground-level ozone.
  • The American Lung Association has found that Arizona cities and counties have some of the nation’s dirtiest air, and one in twelve Arizona children suffer from asthma. Prop 127 will dramatically reduce the rates of asthma attacks, heart disease, lung disease and some cancers.
  • We have a moral obligation to help our kids and others inherit a healthy natural environment, which once gone cannot be replaced.
  • We need to compete with our neighboring states, which are building clean energy economies quickly. Over the last five years, solar energy-related jobs grew nine times faster than the overall economy, but Arizona actually lost solar jobs.

Arguments Against:

  • This Amendment will increase the cost of doing business in Arizona by increasing the cost of energy. Wind and solar power are much more expensive than conventional power. The latest data show wind power is 50% more expensive than conventional power, and solar power is triple the cost of conventional power.
  • If approved, these costly and restrictive regulations will drive up housing costs and electricity prices – doubling the monthly energy bill for the average Arizona household.
  • Energy policy should not be set by an amendment to the Arizona Constitution because it will be nearly impossible to modify in the future.
  • Rural and economically depressed communities, which often obtain their power from electric distribution cooperatives, will be impacted the most by these increased costs. It is estimated that electric bills for these consumers may increase by $45 to $65 per month.
  • The 2030 deadline is much too short for such a major change. A hastened implementation of the referendum would lead to chaos in providing necessary energy for Arizona.
  • Palo Verde is the country’s largest supplier of carbon-free energy and employs over 3,000 Arizona workers, but its contributions to Arizona’s energy portfolio would not count toward the initiative’s proposed mandates.

Supporters:

Advocacy Groups:

  • NextGen Climate Action - $8 Million
  • Arizona Asthma Coalition
  • Arizona Faith Network
  • CHISPA AZ
  • Citizens Climate Lobby
  • Conservative Alliance for Solar Energy
  • Elders Climate Action, Energy Future Project
  • Kids Climate Action Network
  • Mi Familia Vota
  • Mountain Park Health Center
  • Natural Resources Defense Council
  • Physicians for Social Responsibility
  • Sierra Club Grand Canyon Chapter
  • Santa Cruz Valley Climate Coalition
  • Technicians for Sustainability

Unions and Trade Associations:

  • Arizona Building and Construction Trade Council
  • Arizona Public Health Association

Opponents:

Corporations:

  • Pinnacle West Capital Corp - $11 Million

Trade Associations:

  • Aerospace Arizona Association
  • Arizona Bankers Association
  • Arizona Cattle Feeders' Association
  • Arizona Chamber of Commerce
  • Arizona Cotton Growers Association
  • Arizona Farm Bureau Federation
  • Arizona Manufacturers Council
  • Arizona Mining Association
  • Arizona Regional Economic Development Foundation
  • Arizona Rock Products Association
  • Also includes twenty-four local/regional chamber of commerce associations

Advocacy Groups:

  • Americans for Prosperity
  • AMIGOS
  • Arizona Free Enterprise Club
  • Arizona Tax Research Association
  • Chicanos por la Causa
  • Goldwater Institute
  • Greater Phoenix Urban League
  • La Paz Economic Development Corporation
  • Navopache Electric Cooperative
  • Southern Arizona Leadership Council
  • Sun City Homeowners Association
  • Valley Partnership
  • Western Maricopa Coalition