For several years, Arizonans have faced a threat of radical renewable energy mandates being imposed on our grid. In 2018, the voters overwhelmingly rejected a measure that would have required utilities to generate 50% of their energy with “renewables” by 2030. Then, in 2021, the Arizona Corporation Commission considered, and rejected, a 100% renewable mandate completely banning fossil fuel generation by 2050. But now, the utilities have voluntarily committed themselves to these goals, known as “Net Zero by 2050”, under the broader requirements of their Environmental, Social, and Governance (ESG) commitments.
But a new study commissioned by the Arizona Free Enterprise Club, and authored by esteemed economist Stephen Moore, makes clear the high cost of pursuing ESG. In the study, Moore compares the 10 states with the highest cost for electricity to the 10 with the lowest. He finds that nine of the 10 costliest states have renewable energy mandates. Conversely, his paper finds that 7 of the ten cheapest states have no mandates or mandates that amount to less than 20% renewable energy.
This means, according to the study, that residents in states with mandates have, over the last decade, paid 36.4% more for electricity than those who live in states with no mandates which, for many families, means thousands of dollars a year. In 2022 alone, residents living in states with high “renewable” mandates paid 44% more than those living in states with no mandates. Given this, Moore points to a recent study that estimates that these ESG commitments will increase costs for ratepayers 78% by 2050.
The truth is that the environmental goals required by ESG will make our energy unaffordable and unreliable. Two years ago, the Commission’s own independent cost analysis of renewable mandates projected a $6 billion cost to ratepayers. Moore’s study builds on this, showing the future Arizona ratepayers can expect based on the actual experience of other states who have pursued ESG environmental goals: far higher costs.
This new study comes as the Club, hundreds of ratepayers, and former Corporation Commissioner Justin Olson have been asking the ACC to ban ESG, and warning that without a prohibition, every downstream decision, including future rate hikes and resource plans, will be shaped by it.
Just last week, the monopoly utilities submitted new Integrated Resource Plans (IRP) which determine the type of energy production they will build for the next decade and a half. Considering their public commitment to ESG, it’s no surprise that these plans all work toward Net Zero by 2050, retiring coal generation by 2031 completely, and relying almost entirely on solar, wind, and batteries with little to no new natural gas. Based on Moore’s new study, these plans will inevitably cost ratepayers billions, leading to a likely doubling of utility bills.
Read the full paper by Stephen Moore here.
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