Arizona Attorney General Crashes into Arizona Corporation Commission Over Utility Rate Disputes
Agent
Former Commissioner Becomes Sixth Commissioner in Battle Over Rates and Policies
PHOENIX — Arizona Attorney General Kris Mayes is waging a legal war against the Arizona Corporation Commission, accusing the agency of violating state law and failing to protect utility customers. The conflict has drawn sharp criticism from commission members who say Mayes is infringing on their constitutional authority to set rates.
The battle is unfolding in the realm of Arizona's public utilities, where the Corporation Commission holds exclusive, constitutionally-granted power to set rates for the state's major utility companies.
Mayes Files Multiple Rehearing Requests
In March alone, Mayes' office filed three rehearing requests in three separate commission matters, accusing commissioners of:
- Violating state law
- Ignoring commission rules
- Acting contrary to the best interests of utility customers
Mayes' office has also filed a lawsuit over the commission's approval of a controversial data center contract and is intervening in two rate cases involving Arizona Public Service and Tucson Electric Power.
Commission General Counsel Tom Van Flein pushed back against Mayes' assertions, stating in a statement:
The Commission takes each complaint or application for rehearing seriously. However, policy disputes are not the same as legal error. The Commission follows the statutes, the Constitution and relevant case law giving it guidance. Policy disputes are not to be resolved in court or even in a rehearing.
Commission Chair Accuses Mayes of Campaign Strategy
Commission Chair Nick Myers took it one step further, accusing Mayes of using the office for campaign purposes. Myers is also up for reelection this year, alongside fellow Republican Commissioner Kevin Thompson.
Mayes needs to get her name out there, and she's using the office and using these goofy lawsuits to get her name in the public eye for campaign purposes, Myers told the Arizona Capitol Times.
Mayes' communications director Richie Taylor defended the attorney general's involvement in commission issues:
When the commission springs 154 percent utility rate increases on senior citizens, or gives sweetheart deals to data center operators, AG Mayes is going to stand in their way, Taylor said. Chairman Myers should focus on fulfilling the constitutional obligations of the Commission on behalf of Arizonans so the Attorney General doesn't have to step in and do it for them.
Former Democratic AG Sees a Different Approach
Former Democratic Attorney General Terry Goddard, who served in the role at the same time Mayes served on the commission in the early 2000s, said his office did not intervene in commission matters.
But I think that's because the commission was doing its job, Goddard said. I didn't see any reason for us to get involved, the Residential Utility Consumer Office was, as far as I could tell, advocating for consumers and we didn't have the same environment that AG Mayes does.
A Divided Commission
Currently, the commission is made up of five Republican members. Without a single Democratic commissioner, many decisions are made unanimously and tend to favor conservative energy priorities, like promoting coal and natural gas generation and ending renewable energy policies.
The tension between Mayes and the ACC has been simmering for months, with tempers flaring in August as the commission was in the process of repealing its Renewable Energy Standard and Tariff Rules.
The rules — which required the state's major utility companies to get 15 percent of their energy from renewable sources like solar and wind — were originally adopted by the ACC in 2006, when Mayes was serving as a Republican commissioner.
Mayes called the repeal silly and ridiculous, which led Thompson, then the commission's chair, to take a jab at her during an August 26, 2025 hearing on natural gas plants. He facetiously referred to Mayes as the sixth commissioner for her public opposition to the REST rules repeal.
The commission voted unanimously to repeal the rules on March 5 and Mayes' office filed an application for rehearing on March 30, arguing the ACC violated its own rulemaking process by finalizing the repeal before a required economic impact statement was completed.
Rate Increases for Retirement Community Residents
The day after filing an application for rehearing in the REST rules docket, Mayes' office filed another rehearing application in a rate case for two water and wastewater companies serving the Robson Ranch retirement community near Eloy.
While commissioners grew irritated, residents in the area celebrated. We were pleasantly surprised about the AG's office involvement, said Raul Salmon, the leader of a local task force formed to oppose the rate increase. I mean, the AG's filing, if you just read it, vindicates what we've been arguing all along.
Mayes argued the ACC erred in approving a 22 percent rate increase for water and 154 percent increase for wastewater for the Picacho Water and Picacho Sewer Companies because commissioners did not adequately consider the impact on ratepayers and did not review documents related to a stock sale of the utilities to JW Water.
I think it is the kind of thing that just cries out for reexamination by another party, Goddard said. The commission seems to be granting the big increases fairly willingly, and I think that's a bad standard.
Sweetheart Deals and Rate Structures
Thompson and Commissioner Lea Márquez Peterson voted against the rate increase, which could open the door for a potential rehearing, though the commission has yet to act on Mayes' request.
Mayes also requested a rehearing on the commission's approval of a formula rate structure for UNS Gas, allowing the company to adjust customer rates annually rather than going through the typical rate case process every few years.
A Sixth Commissioner Emerges
The conflict has created an unusual dynamic where the attorney general effectively becomes a sixth commissioner, challenging decisions made by the five-member Republican commission. The battle is likely to head to court as Mayes looks to reverse several policy and rate decisions.
The commission maintains its stance that it operates within constitutional bounds while Mayes argues consumer protection requires active intervention when the commission sets rates that could harm ratepayers.
Sources:
- Arizona Capitol Times: https://azcapitoltimes.com/news/attorney-general-mayes-sparks-turf-war-with-arizona-corporation-commission/