Solar panel leasing companies and Arizona lawmakers have stepped back from a probable bruising battle over competing ballot measures to change the state’s energy use laws.

The two sides agreed to mediation, with the hope they can hammer out a deal on what is essentially the future of solar power in a state with the second highest usage in the country.

On one side is Solar City, the largest panel leasing company in the state; on the other are lawmakers who argue they are standing up for the majority of consumers in the state.

Yes on AZ Solar, backed by Solar City and led by a former chair of the Arizona Corporation Commission (ACC), said April 15 it planned to put a ballot initiative before voters in November.

The initiative called for a bar on utilities from charging solar customers based on “peak demand.” Further it would have placed into the state constitution the existing net metering”policies under which utilities pay customers the retail price for the excess power generated. 

“I thought this is awful,” state Sen. Debbie Lesko (R-Peoria) told the Arizona Business Daily. “I want to protect the majority of utility customers who cannot afford to buy or lease panels, or choose not to, or people living in apartments. The majority of people do not have roof-top panels and it’s absolutely greedy of Solar City to try and lock a preferred rate, with the added cost to everybody else."

She added that the initiative, if successful, would benefit the better off at the expense of others.

In addition, the ACC would would have little, or no say, in the setting of rates.

Lesko, and other legislators, decided to strike back with two pieces of legislation that would send ballot measures to Arizona voters asking them whether utilities should pay less than the retail rate and one regulating solar leasing companies as utilities. Lesko was supported by, among others, the state’s largest utility company, Arizona Public Service.

Yes to AZ Solar, led by former ACC Chair Kris Mayes and with funding of $3 million from Solar City, held a rally outside the state Capitol on April 26 that accused legislators and utility companies of trying to stymie moves toward increased solar power.

Days later, and within hours of the Senate agreeing to move forward with the legislative-led ballot measures, Yes to AZ Solar announced it was withdrawing its ballot initiative.

“Solar City got nervous,” Lesko said.

Mayes welcomed the deal, describing it as big to local television station KTAR. She did not reply to requests for an interview from Arizona Business Daily.

“The fact that a large utility like APS and the nation’s largest solar company, SolarCity, are coming together to have these negotiations is almost without precedent,” Mayes said.

"It would have been a pretty ugly dispute between the ballot measures over the summer," ACC Chairman Doug Little said after the deal was announced.

Arizona has the second highest number of homes that use solar energy behind California. Over 300,000 are equipped with them, according to Solar Energy Industries Association.