Arizona tech leader warns repeal of energy standards could undermine economic growth

Arizona’s technology economy is thriving, powered by innovation, growth and a shared commitment to building a more resilient future. However, this progress is now at risk.

The Arizona Corporation Commission’s ongoing effort to repeal the state’s Renewable Energy Standard and Tariff (REST) and Energy Efficiency (EE) rules threatens to undo bipartisan, pro-business energy leadership that has strengthened Arizona’s economy and increased Arizona’s grid reliability.

The ACC’s stated goal is to cut costs and preserve reliability. Repealing these standards will do the opposite. It will inject uncertainty into Arizona’s energy future, weaken the competitive advantage that clean technology brings and ultimately drive higher costs.

Adopted in 2006, the REST rules established a clear framework for utilities to gradually increase the share of electricity generated from renewable sources. The EE rules adopted in 2010 require utilities to help customers reduce energy use and peak demand through rebates and technology upgrades.

Together, these policies have been among the most successful, pro-growth energy tools Arizona has implemented. They have attracted billions in private investment, created tens of thousands of good-paying jobs and helped utilities avoid building expensive power plants, which translates into lower electric bills.

Across the state, companies are investing in advanced manufacturing and clean technology facilities that depend on affordable, reliable and increasingly renewable power. These investments have spurred job growth in both urban and rural communities, strengthened our supply chains and helped make Arizona one of the top states for clean energy manufacturing.

Energy efficiency remains the most cost-effective way to meet Arizona’s growing energy demand. According to The World Bank, for every dollar invested, consumers and businesses have seen nearly $4 in returns through lower utility bills and avoided infrastructure costs.

Energy efficiency can improve grid stability

Expanding efficiency programs that reduce demand and improve grid stability is common sense, not partisanship. Every megawatt saved through smarter energy use is a megawatt that doesn’t have to be generated, transmitted, or paid for by consumers.

Opponents of the REST and EE rules argue Arizona already has “met its goals” and utilities now voluntarily pursue clean energy targets, making the rules unnecessary. Voluntary goals can change overnight, however, and utilities may decide to walk back their clean energy commitments. Without a clear, consistent policy framework, there’s no guarantee that private investment in renewables and efficiency will continue at the pace our growing economy demands.

Some also claim the rules have “cost ratepayers billions.” That may have been true 15 years ago when early solar projects were expensive. But the point of policy is to drive progress, and it worked. Solar and wind prices have fallen by more than 80% since those early investments. Repealing the rules now would cut off the very progress that made clean energy affordable in the first place.

And while critics point to Arizona’s dust storms as proof that solar is unreliable, that’s exactly why we have a diversified energy mix. When gas or nuclear plants supplement renewables during peak demand, that’s not failure. That’s a well-designed system doing its job.

Repealing rules sends the wrong signal

The Arizona Technology Council represents more than 750 science and technology companies statewide, from innovative startups to Fortune 500 firms. Many support and depend on clean, renewable energy to power advanced manufacturing and data operations. These companies choose Arizona because our state has historically embraced an “all-of-the-above” approach: practical, balanced and forward-looking.

Repealing these rules would send the wrong signal to employers and investors at a time when other states are doubling down on clean technology and grid modernization. It would undercut Arizona’s leadership in industries like solar manufacturing, battery storage and high-tech construction, industries that bring quality jobs and long-term economic value.

The ACC should not pick winners and losers but provide stability, predictability and fairness. The REST and EE standards do exactly that.

If the ACC wants reform, let’s reform. But reform should mean modernizing standards and rules, not repealing them altogether. Let’s update the rules to reflect today’s technology and give utilities flexibility to meet them. Let’s continue to expand efficiency programs that save money and strengthen reliability. And let’s keep the policies that have made Arizona a national leader in energy innovation.

The Council urges the ACC to keep the REST and EE standards in place and build upon their proven success. Our future depends on it.

Steve Zylstra is president and CEO of the Arizona Technology Council.