My View: Regional approach could boost Arizona’s energy reliability, create new tech jobs
Relief is in sight.
Arizonans — and our state’s power grid — just weathered one of the hottest summers on record. Not only did we experience record-breaking heat, but we also saw soaring energy demand, leaving countless Arizona businesses with hefty electricity bills. And we were still dealing with extreme heat well into September.
All of this is putting an increasing strain on our electric grid. Without implementing innovative solutions and policies to support our state’s energy needs, we may not be able to sustain this growing demand.
But here’s the good news: Arizona is primed to work with other states in the region to increase our grid reliability and deliver more affordable energy for Arizona families and businesses by seizing the opportunity in our clean energy sector. Plus, we can grow our state’s economic prosperity by bringing more jobs to Arizonans.
One solution that would help accomplish all of this is captured in just three letters: RTO. That stands for regional transmission organization, an integrated energy marketplace where utilities have more flexibility to efficiently coordinate electricity resources across state lines.
Here’s an example of how this system works:
It’s a sunny afternoon in Arizona and solar energy production is high. Meanwhile, it’s mild and calm in Cheyenne, Wyoming, which usually has high wind production. But later in the day, a storm system clouds the skies over a large solar farm in Arizona as the wind picks up in Wyoming, generating excess wind power.
In both instances, the excess energy from one state could quickly and efficiently be sold to another, increasing grid reliability and lowering energy costs. It’s a carefully coordinated process that, when set up correctly, helps states better manage their real-time response to energy demand.
Arizona has a chance to collaborate with other states to regionalize our electricity grid through an RTO.
There is new momentum underway across the West to drive increased regional coordination, support states’ energy policy goals and meet demand in a cost-effective manner. Arizona should join this conversation.
The West is brimming with diverse energy resources — hydroelectric, solar and wind to name a few — that would allow states to complement one another’s energy portfolios if the right policies are in place. Plus, joining a regional grid would deliver clear economic benefits for Arizona ratepayers.
By investing in Arizona’s clean energy economy and establishing strategic partnerships in an RTO, the state can attract more technology companies to continue growing our state’s already booming tech sector. Big industry names like solar module manufacturer Meyer Burger, battery cell developer KORE Power and lithium-ion battery recycling facility Li-Cycle have all made headlines for ramping up their operations in Arizona.
Joining a regional grid would also further catalyze our growing electric vehicle and battery manufacturing industries. Over the past eight years alone, Arizona has attracted almost $11 billion in private investments and added close to 11,500 jobs in these sectors — economic growth we likely wouldn’t see without the development of sustainable energy resources.
And the technology sector isn’t the only sector that stands to gain.
A study conducted last year by Energy Strategies, an independent energy consulting firm, found that regional electricity grid collaboration could create up to 28,000 new, permanent jobs in Arizona, and generate up to $2.7 billion in new gross state product while delivering more than $140 million in annual energy cost savings.
According to the study, joining a regional grid could create upward of 4,000 warehousing and storage jobs, up to 1,100 data processing and hosting jobs, and more than 3,000 manufacturing jobs in medical equipment, structural metals, food and more.
The economic benefits of regionalizing our grid are immensely clear. That is why we’re calling on the Arizona Corporation Commission and state leaders to explore this pathway that would help deliver cheaper, more reliable energy for Arizonans.
As Western states collaborate to build an energy system for the future, leaders must ensure our utilities are thinking about the priorities, investments and structures that best protect Arizona families and businesses from out-of-control energy costs.
Now is the time to engage Arizonans — from individual households to local small businesses to large industrial and commercial customers — to ensure a more reliable and affordable energy future for our state.
Like the weather, relief is in sight. Three letters — RTO — could be game-changing for our economy, and we can’t afford to miss this opportunity.
Steven G. Zylstra is President & CEO of the Arizona Technology Council and SciTech Institute.