Dive Brief:

• The Arizona Corporation Commission on Tuesday voted 4-1 to deny an 820-MW expansion at a gas plant proposed by Salt River Project. Regulators said there was insufficient evidence in the record to make a decision, and the expansion would put too much pressure on the nearby, historically-Black community of Randolph.
• Clean energy and community advocates said the denial is a major victory for environmental justice, arguing the utility did not consider other resource options, provide information on potential bill impacts, or sufficiently engage with the residents of Randolph.
• SRP said the denial creates a near-term resource challenge and that the utility "will continue to evaluate what generation and market options to pursue."

Dive Insight:

The denial of SRP's Coolidge Generation Station expansion was a win for residents, but also a surprise for some. Dozens showed up for the ACC's first in-person open meeting since the pandemic shutdown.

"It was unbelievable. I didn't think the vote would go this way," homeowner Jeff Jordan told news channel ABC15. "I'm so elated."

While the ACC does not regulate SRP rates, because of the size of the proposed gas plant expansion regulators' approval was still necessary. The utility had planned to install 16 new gas turbines but faced pushback over charges of energy racism, environmental injustice and the lack of a competitive bidding process for the nearly $1 billion project.

"I believe the application and evidence on the record was incomplete and insufficient for us to make an informed decision," Chairwoman Lea Márquez Peterson said at the open meeting.

"I do not believe it is wise to put further pressure on this community to relocate," Commissioner Anna Tovar said. "The history is important and we shouldn't lose that."

Only Commissioner Justin Olson voted for the plant expansion. "I'm concerned about Arizonans being able to have their air conditioning during the hot summer months," he said. 

Advocates say commissioners made the right decision, and that more must be done to protect vulnerable communities and utilize clean energy resources.

"It is imperative that this level of environmental injustice is not allowed to be repeated or continued,” Rural Arizona Action Research Assistant Kate Boettcher said in a statement.

Randolph residents "deserve meaningful concessions" from the utility to address environmental impacts caused by the existing plant, as well as "the lack of community inclusion in the decision-making process prior to the announcement of the project," Boettcher said.

The project denial "is a win for climate action and environmental justice in Arizona,” Adam Stafford, Western Resource Advocates’ managing senior staff attorney in the state, said in a statement. "It’s time for SRP to find clean alternatives and revisit its sustainability goals."

"The Commission should be applauded for sending SRP to the drawing board to provide answers and for protecting ratepayers from what could have been unnecessary electric bill impacts for years and years to come," Diane Brown, executive director of Arizona Public Interest Research Group Education Fund, said in an email.

SRP says it plans to reduce carbon intensity by more than 65% in 2035 and by 90% in 2050, relative to 2005 levels. And the not-for-profit utility has pledged to add more than 2 GW of new utility-scale solar energy to its portfolio by 2025 and 450 MW of battery storage by 2023.

However, the gas plant expansion was necessary to address near-term resource shortages, SRP told regulators. Along with helping to meet peak demand, the Coolidge expansion would also help to reliably integrate more renewable energy resources, the utility said.

"SRP will continue to evaluate what generation and market options to pursue in the near-term to address the resource challenge this decision creates for serving our customers," the utility said in a statement. "Additional updates will be provided as they become available."