August 15, 2013 | By Keith Martin in Washington, DC

Arizona is the latest battleground for rooftop solar companies and utilities.

Arizona Public Service asked the Arizona Corporation Commission in July for permission to charge customers who install rooftop solar panels $50 to $100 more a month on their utility bills as compensation for the ability to draw electricity at any time from the grid. The additional charges would only apply to customers who install solar systems after October 15.

The utility has 18,000 solar customers in its service territory currently. It is receiving 200 new applications a week.

It also asked the commission for permission to reduce the amount it credits customers who produce more electricity than they need and feed the excess back into the grid. The utility credits these customers under its “net metering” program at the same retail rate the customers pay to buy electricity from the utility. (Under a net metering program, a customer’s meter runs backwards as it feeds electricity into the grid.) The average solar customer pays 15.5¢ a kilowatt hour. The utility argues that it should not have to pay more than the market rate it can pay to buy power from large power plants.

The proposals would significantly alter the economics of installing solar. Some utilities are facing steady erosion in their rate bases as solar rooftop, fuel cell and small cogeneration or CHP companies pick off customers. The same battles are or will soon be fought in other states.