APS

highest one hour of electricity use during peak hours in the month. It was widely opposed.

The settlement would not make demand rates mandatory, but it would force all new APS customers or those who move within the territory to use either a demand rate or a time-of-use rate, where it costs more to use electricity during peak hours, for at least 90 days.

APS will still offer a basic, flat-rate plan that charges a monthly service fee and flat rate for kilowatt-hours of electricity, regardless of when it is used throughout the day.

But new or moving customers will need to try one of the demand or timeof-use rates before being allowed to sign up for the basic plan.

The basic, flat-rate plan is the most popular, used by about 478,000 of the utility’s 1.1 million customers. Current customers on that plan will transition to the new basic plan.

However, the number of customers choosing a time-of-use plan is growing, as is the number of people on the optional demand-rate plan. Combined, those two plans today have more customers than the flat-rate plan.

Stefanie Layton, APS director revenue requirement, said the company is committed to helping customers find the rate plan that best fits their lifestyle and offers them the greatest savings. She said only 13 percent of customers would benefit from being on the proposed flat-rate plan, while 60 percent would pay less by being on either demand rate or time-of-use rate.

“We want those customers to understand they will save money on one of those rates,” Layton said. “That is without changing any behavior.”

But even energy-efficiency proponents who see the conservation merits of time-of-use rate plans say they need to be optional, not mandatory.

“Forcing new customers on a timeof-use rate, that is a concern for us,” said Jeff Schlegel, the state representative for the Southwest Energy Efficiency Project (SWEEP), a conservation group.

APS officials touted the proposal as increasing choices for consumers because it includes new rate options.

“You do have an option,” Schlegel said. “You can be shot in the head, stabbed in the heart or stabbed in the kidneys.”

Customers usually adapt better when they sign up for such programs voluntarily, he said.