APS to pay $24 million to customers who were misled about its cheapest rate plans

By Ryan Randazzo | Arizona Republic

Problems with a rate-comparison tool, first reported by The Republic, caused thousands of customers to choose plans that were not the cheapest option.

Arizona’s largest electric company will pay $24 million for not explaining its rates properly and erroneously directing thousands of customers away from its cheapest plans, Attorney General Mark Brnovich announced Monday.

Arizona Public Service Co. raised rates and changed the way customers are billed on some plans in 2017, with approval from regulators at the Arizona Corporation Commission. Then, the company moved customers to new rate plans if they didn’t choose one for themselves.

Explaining the new rates proved challenging even for company employees.

Among other problems, the utility misdirected customers on its website in 2019 with a rate-comparison tool that was meant to show customers which of the new plans would be cheapest for them. That tool instead directed many people to something other than the cheapest plan.

Problems with the rate-comparison tool, first reported by The Arizona Republic in 2019, caused thousands of customers to choose plans that were not the cheapest.

In some cases, customers were directed to plans that would cost them hundreds of dollars more per year than the plan that best fit the amount of electricity they used and the time of day they used it.

The new settlement will be split among about 225,000 customers. Ratepayers will not fund the settlement, APS told regulators in a letter.

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