Portland, Maine (Platts)--17Oct2008

The Arizona Corporation Commission has approved net-metering rules
designed to replace a patchwork of utility practices and spur distributed
generation in the state.

Arizona's renewable portfolio standard ramps up to 15% by 2025. The
standard includes a requirement that distributed generation account for 10% of
the standard this year and 30% by 2012.

The ACC expects the net-metering rules to provide an incentive for
customers to install distributed generation, most likely solar, on their homes
and businesses.

Under the rules, investor-owned and cooperative utility customers will be
able to generate up to 125% of their peak load and sell any excess power to
their utility. Facilities with a generating capability greater than 125% of
peak demand will need a special contract with the utility.

Utilities had several concerns with the net metering rules, which led ACC
Chairman Mike Gleason to vote against them. "These rules ignore serious
concerns that had been voiced by the major commission-regulated electric
utilities," Gleason said, adding that discussion at the meeting "revealed that
the rules can endanger the electric grid, the meter on your house, and the
wiring in your house." The rules go to the Arizona Attorney General's office
for final approval.