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ARIZONA STATE SENATE
Fifty-Seventh Legislature, Second Regular Session
REVISED
public service corporation; rates; intervenor
Purpose
Background
The rates charged by Arizona's investor-owned utilities are established by the Arizona Corporation Commission (ACC). The ACC authorizes a utility to charge rates which will recover expenditures that are appropriate and prudently incurred and also provides an opportunity to earn a fair return on the utility's capital investment. A utility initiates the process to obtain a rate increase by filing an application with the ACC. The application must be based on a test year of actual expenses and investments during a recent 12-month period. All the utility's cost data are drawn from its own records. The ACC requires the utilities to follow a standardized system of accounting procedures that assures that the data can be easily reviewed and verified by the ACC, RUCO and others (RUCO).
The Director of RUCO may: 1) research, study and analyze residential utility consumer interests; 2) prepare and present briefs, arguments, proposed rates or orders and intervene or appear on behalf of residential utility consumers before hearing officers and the ACC as a party in interest and also participate as a party in interest in proceedings relating to rate making or rate design and involving public service corporations; 3) make and execute contracts and other instruments as necessary to perform the Director of RUCO's duties: 4) hire employees as necessary for prescribed purposes; and 5) employ such attorneys as are required to represent the interests of residential utility consumers. The Director of RUCO must adopt administrative rules necessary to carry out RUCO's statutorily prescribed powers and duties. RUCO may advise the consumer of other agencies that may be of further assistance and must refer the consumer to the ACC Utilities Division (A.R.S. § 40-464).
The Joint Legislative Budget Committee (JLBC) fiscal note estimates that H.B. 2113 would result in an increase in costs to the RUCO Revolving Fund associated with a larger caseload for RUCO. RUCO testified in the Senate Natural Resources Committee that the bill would increase their costs by $2 million, create an additional 16 cases and require 13 additional FTE positions. JLBC has requested supporting written documentation of the cost projection RUCO provided in testimony but has not yet received a response and therefore is not able to comment on the validity of RUCO's estimate (JLBC fiscal note).
Provisions
1. Requires the Director of RUCO to intervene in a public service corporation rate case if the impact of the public service corporation's proposed rate increase to residential customers is 100 percent or more.
2. Makes technical changes
3. Becomes effective on the general effective date.
Revisions
· Updates the fiscal impact statement.
House Action
NREW 2/3/26 W/D
RED 2/12/26 DP 5-1-1-0
3rd Read 2/23/26 40-17-3
Prepared by Senate Research
April 8, 2026
SB/NRG/hk