Chairwoman Lea Márquez Peterson of the Arizona Corporation Commission is encouraging Arizona’s largest electric utility, Arizona Public Service Company (APS), to partner with local venture capital groups to incorporate utility/energy RFPs into local start-up competitions and technology transfer programs.
According to Chairwoman Márquez Peterson, the effort is intended to give local entrepreneurs and start-up companies an opportunity to win utility contracts for new innovations in grid-connected devices, such as smart inverters, thermostats, appliances, and at-home battery systems, as well as the software that synchronizes them.
“Arizona has a strong entrepreneurial ecosystem, so I have proposed APS partner with organizers of local ‘start-up’-based events (such as StartUpAZ, Startup Grind, Invest Southwest, ASU Venture Devils, Startup Tucson, Tech Launch Arizona, and UA Center for Innovation, etc.) and consider issuing RFPs and contracts in coordination with these events.”
The Arizona Corporation Commission is a five-member body that regulates Arizona’s largest electric utilities, including APS. It sets the rates that electric utilities charge customers and reviews the contracts that utilities award to ensure that such contracts provide value to the grid.
For many technology start-ups, high application fees can serve as a barrier to entry in competitive solicitations for public and private contracts. Yet, utilities like APS can be a major source of winning high value bids and bringing products to market. Thus, well-established companies often have an advantage and take away opportunities for new market entrants to win bids.
“APS is a major employer in our state with a lot of contracts available to build out a resilient grid; winning a big contract with a major electric company like APS can be a major launching pad, and I believe APS should take advantage of and help to spread these innovative technologies,” said Márquez Peterson.
In January 2021, the Commission announced plans to develop a new RFP program for APS that would, once adopted, give new technology and software companies an opportunity to improve the efficiency of the grid and help synchronize at-home energy devices across the entire distribution system.
A press release announcing the Commission’s effort to promote the development of such advanced technologies can be found here.
As a part of the new RFP program, Chairwoman Lea Márquez Peterson would like to see local entrepreneurs in the energy technology landscape compete against well-established companies for contracts with Arizona’s largest electric utility.
The proposed program would feature a yearly RFP cycle that would allow local entrepreneurs, start-up companies, and venture capital groups participating in local competitions and technology transfer programs to bid into the RFPs at a lower cost, thereby reducing the barrier to entry.
To increase awareness, Chairwoman Márquez Peterson would like to see APS promote its new RFPs within the local entrepreneurial ecosystem, such as by partnering with organizations that host major start-up/venture capital competitions in Arizona and giving innovators enough time to develop their products.
“The internet of things that we are seeing being developed today is astounding and should be utilized whenever possible to make Arizona a leader in the adoption of smart and innovative energy systems. I believe we have an opportunity to optimize the grid with new and innovative energy technologies, including grid-connected at-home energy devices like smart thermostats, appliances, and battery energy storage systems, which can help advance Arizona’s economy.”
“I believe APS can further support Arizona’s thriving entrepreneurial ecosystem by partnering with local organizations to promote these new RFPs to Arizona’s innovators and local start-ups.”
A copy of Chairwoman Márquez Peterson’s draft proposal can be found here.
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