The new occupants of three of the five seats on the Arizona Corporation Commission will be decided on the November ballot. The commission, the major duties of which are to regulate utility companies, oversee rate-setting and incorporate businesses in Arizona, is currently composed of four Republicans and one Democrat.
The candidates running for the three seats are Democrats Ylenia Aguilar, Jonathon Hill and Joshua Polacheck; Republicans Rene Lopez, incumbent Lea Marquez Peterson and Rachel Walden; and Green Party candidates Mike Cease and Nina Luxenberg. Voters will elect three candidates on the Tuesday, Nov. 5, ballot.
Josh Polacheck
Polacheck made an appearance in Sedona on Sunday, Oct. 6.
“I define myself [politically] as a former lifelong Republican who has taken my oath to the Constitution seriously, and now I find myself running in the Democratic Party, but as a moderate to conservative Democrat,” Polacheck said.
He added that in his view the GOP has failed to live up to its goal of facilitating free markets, and particularly that the ACC has unfairly incentivized fossil fuels in energy development.
“Under the current model, we’re providing perverse incentives to be building more expensive technology that keeps us attached to a global commodity chain,” Polacheck said. “Because the utilities are allowed to pass on their operating expenses, especially the purchase of wholesale coal and methane directly onto the consumers, so that never hits their profit and loss statement. They’re incentivized to build generating infrastructure where they don’t have to deal with the operating expenses and they can pass it on to the consumer.”
Polacheck said that the ACC should focus on the total cost of energy, and not just the initial capital expenses, because it would provide a more equitable deal for all parties while offering a market solution. Because Arizona gets most of its natural gas from New Mexico and Texas, Polacheck said the money used to buy those commodities is leaving Arizona and could be better spent within Arizona.
Polacheck spent his early years attending reservation schools in Alaska, Arizona, New Mexico and Nevada as the son of an Indian Health Service doctor before the family settled in Tucson during his middle school years. After college, Polacheck worked for the U.S. Department of State for 17 years, including as a State Department spokesperson in Mosul, Iraq, during 2007.
“I thought this was a race where I can bring my national security background, and my understanding of policy and how to actually get things done in a nonpartisan way, to help the business of Arizona and to leave a real legacy,” Polacheck said. “The Corporation Commission, over the next four years, is going to be making decisions that will impact the future of our economy, not just 10 years from now, not just a quarter century from now, but 60 years from now.”
Polacheck’s last diplomatic assignment was in Kingston, Jamaica.
“Jamaica, similar to Arizona, does not have trillions of dollars in proven oil or gas reserves,” Polacheck said. “It is dependent on powering its economy by the global commodities market, and that has led to some real shocks to the economy in Jamaica, similar to some of the price shocks that we’ve seen in Arizona with our rising rates.”
Polacheck said that he sees the election in part as a referendum on the commission’s recent approval of rate cases that allowed companies such as Arizona Public Service to raise their rates by about 8%. Locally, the Arizona Water Co. filed a request on June 21 to increase its rates by nearly 50%.
“First and foremost [I’d] like to see the utilities present not just a short-term justification for their rate increases, which is what the current commission has been doing, but how that plays into their long-term plans for service delivery,” Polacheck said. “There’s a disconnect between the long-term planning and the short-term rate cases, that’s why you’re seeing 10% a year on year rate increases … They’re locking in these rate increases with very short-term thinking, and we’re going to be stuck with those rates for the indefinite future.”
Polacheck said that watching Jamaica diversify its energy sources with American companies through a bidding process was a formative experience for him.
“I assumed that meant that at home, if we were promoting this abroad, and we were helping American companies win these contracts abroad, that we had sorted these issues out at home, that we wanted to no longer stake our economic future on a global commodity supply chain that, as we have seen with the wars in eastern Europe, the wars in the Persian Gulf, is fragile,” Polacheck said. “For me, this is a national security issue. Arizona has an opportunity to show the nation that we can achieve energy sovereignty in a way that is affordable and reliable for the entire country.”
Utility Rates
“The Corporation Commission is constitutionally created, and we must provide just and reasonable rates,” Marquez Peterson said during a Sept. 3 debate. “We’re very aware of that as we’re sitting before the 40 to 50 rate cases we see a year. We regulate about 400 utilities. But let’s really look at the facts. The facts say in a recent Wallet Hub survey that Arizona is second-lowest in the nation when it comes to a combination of electricity, gas and gasoline bills.”
However, according to an analysis by Texas Electricity Ratings, Arizona has the eighth-highest annual electrical bill at an estimated $2,190 per household in 2024 against the national average of $1,730.
